TORONTO, Aug. 5, 2021 /CNW/ - Denison Mines
Corp. ('Denison' or the 'Company') (TSX: DML) (NYSE
American: DNN) today filed its Condensed Consolidated Financial
Statements and Management's Discussion & Analysis ('MD&A')
for the quarter ended June 30, 2021.
Both documents will be available on the Company's website at
www.denisonmines.com or on SEDAR (at www.sedar.com) and EDGAR
(at www.sec.gov/edgar.shtml). The highlights provided below are
derived from these documents and should be read in conjunction with
them. All amounts in this release are in Canadian dollars unless
otherwise stated. PDF Version
David Cates, President and CEO of
Denison commented, "The Company continues
to successfully advance on its ambition of developing the
high-grade Phoenix deposit, as
potentially one of the lowest cost uranium mines in the world, at a
time when the uranium market is showing signs of a sustained
recovery and the beginnings of a new contracting cycle.
Thus far in 2021, our corporate team has bolstered our
balance sheet with our recent financings and uranium purchases,
consolidated a further 5% ownership in our flagship Wheeler River
project through our acquisition of 50% of JCU, and completed the
transition of Uranium Participation Corp. to the Sprott Physical
Uranium Trust. On the technical side, in relation to our
progress at Phoenix, we have
reported several positive updates on ISR field testing activities,
metallurgical studies in support of the ISR mining method, and the
discovery of additional high-grade uranium in the area of our
expected first mining phase. Taken together, we believe that
Denison is well positioned to continue de-risking the use of the
ISR mining method at Phoenix and
ultimately compete with the incumbent uranium producers in the
coming years when the market needs additional sources of
production.
Our focus for the remainder of 2021 is expected to be in
the field, where we plan to be active on both the evaluation and
exploration front. Our evaluation team is preparing for
full-scale pump and injection tests as well as ion tracer tests at
Phoenix, making use of the
commercial-scale 5-spot test pattern installed earlier this year.
Our exploration team is also readying to resume drill testing
of various target areas at Wheeler River and nearby properties that
are prospective for the discovery of additional potentially ISR
amenable uranium resources. With results from these programs
expected through the third and fourth quarter, it is an exciting
time for investors to follow both the uranium market and Denison's
company-specific activities closely."
HIGHLIGHTS
- In-Situ Recovery ('ISR') field test activities at the
Phoenix uranium deposit
('Phoenix') progress
A substantial portion of the ISR
field test program has been successfully completed, including the
installation of all five commercial-scale wells ('CSWs') and nine
of eleven monitoring wells ('MWs') planned for the 5-spot test
pattern (the 'Test Pattern') located in the Phase 1 area of
Phoenix on the Company's Wheeler
River Uranium Project ('Wheeler River' or the 'Project').
Based on the progress to date, multi-day pump and injection tests
and ion tracer tests are planned to be initiated and completed on
the full-scale Test Pattern during the third quarter.
- Discovered high-grade uranium outside of the Phoenix Zone A
high-grade domain
Drill hole GWR-045 was completed
as part of the ISR field test program to install MWs to the
northwest of the CSW Test Pattern. Based on the mineral
resources currently estimated for Phoenix, GWR-045 was expected to intersect low
grade uranium mineralization on the northwest margin of the
deposit, approximately 5 metres outside of the boundary of the
Phoenix Zone A high-grade resource domain. The drill hole,
however, intersected a thick interval of high-grade
unconformity-associated uranium mineralization with grades of 22.0%
eU3O8 over 8.6 metres. The intersection is
presently open further to the northwest and represents an area for
further exploration and potential mineral resource expansion of
Phoenix.
- Decision to increase anticipated ISR mining head grade at
Phoenix by 50%
Positive interim results,
completed to date, from the ongoing metallurgical test program for
the planned ISR mining operation at Phoenix have consistently supported uranium
bearing solution ('UBS') head-grade for Phoenix well in excess of the 10 grams / Litre
used in the Pre-Feasibility Study ("PFS") completed for Wheeler
River in 2018. Accordingly, the Company has decided to adapt
its plans for the remaining metallurgical test work, including the
bench-scale tests of the unit operations of the proposed process
plant, to reflect a 50% increase in the head-grade of UBS to be
recovered from the well-field.
- Completed acquisition of 50% of JCU (Canada) Exploration Company, Limited ('JCU')
for $20.5 million
In June
2021, Denison announced that it had entered into a binding
agreement with UEX Corporation ('UEX') to acquire 50% of JCU from
UEX for cash consideration of $20.5
million following UEX's acquisition of 100% of JCU from
Overseas Uranium Resources Development Co., Ltd. for $41 million. Denison's acquisition of 50% of JCU
was completed on August 3,
2021. JCU holds a portfolio of 12 uranium project joint
venture interests in Canada,
including a 10% interest in Wheeler River, a 30.099% interest in
the Millennium project (Cameco Corporation 69.901%), a 33.8123%
interest in the Kiggavik project (Orano Canada Inc. ('Orano
Canada') 66.1877%), and a 34.4508% interest in the Christie Lake
project (UEX 65.5492%).
- Received $5.8 million in
connection with conversion of Uranium Participation Corporation
('UPC') into the Sprott Physical Uranium Trust
In April
2021, UPC announced that it had reached an agreement with
Sprott Asset Management LP ('Sprott') to convert UPC into the
Sprott Physical Uranium Trust. Upon completion of this transaction
on July 19, 2021, Sprott became the
manager of the Sprott Physical Uranium Trust, and the management
services agreement ('MSA') between Denison and UPC was terminated.
In accordance with the terms of the MSA, Denison received a cash
payment of approximately $5.8 million
in connection with the termination.
About Wheeler River
Wheeler River is the largest undeveloped uranium project in the
infrastructure rich eastern portion of the Athabasca Basin region, in northern
Saskatchewan and is a joint
venture between Denison and Denison's 50%-owned JCU (Canada) Exploration Company Limited.
Denison is the operator of the project and holds an effective 95%
ownership interest. The project is host to the high-grade
Phoenix and Gryphon uranium
deposits, discovered by Denison in 2008 and 2014, respectively,
estimated to have combined Indicated Mineral Resources of 132.1
million pounds U3O8 (1,809,000 tonnes at an
average grade of 3.3% U3O8), plus combined
Inferred Mineral Resources of 3.0 million pounds
U3O8 (82,000 tonnes at an average grade of
1.7% U3O8).
The PFS was completed in late 2018, considering the potential
economic merit of developing the Phoenix deposit as an ISR operation and the
Gryphon deposit as a conventional underground mining operation.
Taken together, the project is estimated to have mine production of
109.4 million pounds U3O8 over a 14-year mine
life, with a base case pre-tax net present value ('NPV') of
$1.31 billion (8% discount rate),
Internal Rate of Return ('IRR') of 38.7%, and initial
pre-production capital expenditures of $322.5 million. The Phoenix ISR operation is
estimated to have a stand-alone base case pre-tax NPV of
$930.4 million (8% discount rate),
IRR of 43.3%, initial pre-production capital expenditures of
$322.5 million, and industry leading
average operating costs of US$3.33/lb
U3O8. The PFS was prepared on a project (100%
ownership) and pre-tax basis, as each of the partners to the
Wheeler River Joint Venture are subject to different tax and other
obligations.
Further details regarding the PFS, including additional
scientific and technical information, as well as after-tax results
attributable to Denison's ownership interest, are described in
greater detail in the NI 43-101 Technical Report titled
"Pre-feasibility Study for the Wheeler River Uranium Project,
Saskatchewan, Canada" dated
October 30, 2018 with an effective
date of September 24, 2018. A copy of
this report is available on Denison's website and under its profile
on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov/edgar.shtml.
Given the social, financial and market disruptions related to
COVID-19, and certain fiscally prudent measures, Denison
temporarily suspended certain activities at Wheeler River starting
in April 2020, including the formal
parts of the EA program, which is on the critical path to achieving
the project development schedule outlined in the PFS Technical
Report. While the formal EA process has resumed in early 2021, the
Company is not currently able to estimate the impact to the project
development schedule, outlined in the PFS Technical Report, and
users are cautioned that certain of the estimates provided therein,
particularly regarding the start of pre-production activities in
2021 and first production in 2024 should not be relied upon.
About Denison
Denison Mines Corp. was formed under the laws of Ontario and is a reporting issuer in all
Canadian provinces. Denison's common shares are listed on the
Toronto Stock Exchange (the 'TSX') under the symbol 'DML' and on
the NYSE American exchange under the symbol 'DNN'.
Denison is a uranium exploration and development company with
interests focused in the Athabasca Basin region of northern
Saskatchewan, Canada. In
addition to its flagship Wheeler River uranium project,
Denison's interests in Saskatchewan include a 22.5% ownership
interest in the McClean Lake Joint Venture ('MLJV'), which includes
several uranium deposits and the McClean Lake uranium mill, which
is contracted to process the ore from the Cigar Lake mine under a
toll milling agreement (see RESULTS OF OPERATIONS below for more
details), plus a 25.17% interest in the Midwest deposits and a
66.90% interest in the Tthe Heldeth Túé ('THT', formerly J Zone)
and Huskie deposits on the Waterbury Lake property. The Midwest,
THT and Huskie deposits are located within 20 kilometres of the
McClean Lake mill. In addition, Denison has an
extensive portfolio of exploration projects in the
Athabasca Basin
region.
Through its 50% ownership of JCU, Denison also holds interests
in various uranium project joint ventures in Canada, including the Millennium project (JCU
30.099%), the Kiggavik project (JCU 33.8123%) and Christie Lake
(JCU 34.4508%).
Denison is engaged in mine decommissioning and environmental
services through its Closed Mines group, which manages Denison's
Elliot Lake reclamation projects
and provides post-closure mine and maintenance services to a
variety of industry and government clients.
Up until July 19, 2021, Denison
also served as the manager of UPC. UPC was a publicly traded
company listed on the TSX, which invested in uranium oxide in
concentrates ('U3O8') and uranium
hexafluoride ('UF6'). In April, 2021, UPC announced that
it had entered into an agreement with Sprott to convert UPC into
the Sprott Physical Uranium Trust. This transaction closed on
July 19, 2021, and the MSA between
Denison and UPC was terminated.
Technical Disclosure and Qualified Person
The technical information contained in this press release has
been reviewed and approved by David
Bronkhorst, P.Eng, Denison's Vice President, Operations
and/or Andrew Yackulic, P. Geo,
Denison's Director, Exploration, each of whom is a Qualified Person
in accordance with the requirements of NI 43-101.
Follow Denison on Twitter: @DenisonMinesCo
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
Certain information contained in this press release constitutes
'forward-looking information', within the meaning of the applicable
United States and Canadian
legislation concerning the business, operations and financial
performance and condition of Denison.
Generally, these forward-looking statements can be identified by
the use of forward-looking terminology such as 'plans', 'expects',
'budget', 'scheduled', 'estimates', 'forecasts', 'intends',
'anticipates', or 'believes', or the negatives and/or variations of
such words and phrases, or state that certain actions, events or
results 'may', 'could', 'would', 'might' or 'will be taken',
'occur', 'be achieved' or 'has the potential to'.
In particular, this press release contains forward-looking
information pertaining to the following: projections with respect
to use of proceeds of recent financings; exploration, development
and expansion plans and objectives, including the plans and
objectives for Wheeler River and the related evaluation field
program activities and exploration objectives; the plans for
metallurgical test work; the impact of COVID-19 on Denison's
operations; the estimates of Denison's mineral reserves and mineral
resources or results of exploration; expectations regarding
Denison's joint venture ownership interests; expectations regarding
the continuity of its agreements with third parties; and its
interpretations of, and expectations for, nuclear energy and
uranium demand. Statements relating to 'mineral reserves' or
'mineral resources' are deemed to be forward-looking information,
as they involve the implied assessment, based on certain estimates
and assumptions that the mineral reserves and mineral resources
described can be profitably produced in the future.
Forward looking statements are based on the opinions and
estimates of management as of the date such statements are made,
and they are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of Denison to be materially different
from those expressed or implied by such forward-looking statements.
For example, the results and underlying assumptions and
interpretations of the PFS as well as de-risking efforts such as
the 2021 Field Program discussed herein may not be maintained after
further testing or be representative of actual conditions within
the applicable deposits. In addition, Denison may decide or
otherwise be required to extend the EA and/or otherwise discontinue
testing, evaluation and development work if it is unable to
maintain or otherwise secure the necessary approvals or resources
(such as testing facilities, capital funding, etc.). Denison
believes that the expectations reflected in this forward-looking
information are reasonable, but no assurance can be given that
these expectations will prove to be accurate and results may differ
materially from those anticipated in this forward-looking
information. For a discussion in respect of risks and other factors
that could influence forward-looking events, please refer to the
factors discussed in Denison's Annual Information Form dated
March 26, 2021 under the heading
'Risk Factors'. These factors are not, and should not be, construed
as being exhaustive.
Accordingly, readers should not place undue reliance on
forward-looking statements. The forward-looking information
contained in this press release is expressly qualified by this
cautionary statement. Any forward-looking information and the
assumptions made with respect thereto speaks only as of the date of
this press release. Denison does not undertake any obligation to
publicly update or revise any forward-looking information after the
date of this press release to conform such information to actual
results or to changes in Denison's expectations except as otherwise
required by applicable legislation.
Cautionary Note to United States Investors Concerning
Estimates of Mineral Resources and Mineral Reserves: This
press release may use terms such as "measured", "indicated" and/or
"inferred" mineral resources and "proven" or "probable" mineral
reserves, which are terms defined with reference to the guidelines
set out in the Canadian Institute of Mining, Metallurgy and
Petroleum ("CIM") CIM Definition Standards on Mineral Resources and
Mineral Reserves ("CIM Standards"). The Company's
descriptions of its projects using CIM Standards may not be
comparable to similar information made public by U.S. companies
subject to the reporting and disclosure requirements under
the United States federal
securities laws and the rules and regulations thereunder. .
United States investors are
cautioned not to assume that all or any part of measured or
indicated mineral resources will ever be converted into mineral
reserves. United States investors
are also cautioned not to assume that all or any part of an
inferred mineral resource exists, or is economically or legally
mineable.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/denison-reports-results-from-q2-2021-301349914.html
SOURCE Denison Mines Corp.