TORONTO, Jan. 28, 2021 /PRNewswire/ - Denison
Mines Corp. ("Denison" or the "Company") (TSX: DML) (NYSE:
DNN) is pleased to report the results from the 2020 regional
exploration program at the Company's 90% owned Wheeler River
Uranium Project ("Wheeler River"), including the discovery of new
high-grade unconformity-hosted uranium mineralization up to 7.66%
U3O8. Drill hole WR-741AD2, which was
completed along the K West conductive trend on the western side of
the Wheeler River property, intersected high-grade uranium
mineralization approximately 4 kilometres north northwest of the
Phoenix uranium deposit
("Phoenix"). PDF Version
Similar to Phoenix, uranium
mineralization discovered in WR-741AD2 is interpreted to straddle
the unconformity contact of the underlying basement rocks and the
overlying Athabasca Basin
sandstone. In addition to high-grade uranium, the assay
results from WR-741AD2 are highlighted by the presence of
high-grade nickel:
- 2.14% U3O8 over 4.0 metres
(including 7.66% U3O8 over 1 metre) from
640.3 to 644.3 metres; and
- 4.29% Nickel over 6.5 metres (including grades of up to
19.1% nickel) from 637.8 to 644.3 metres.
David Cates, Denison's President
& CEO, commented, "Regional exploration at Wheeler River
in 2020 delivered on our objective to identify additional
high-grade uranium mineralization that could produce a satellite
deposit for the planned Phoenix In-Situ Recovery ('ISR') operation,
which is currently advancing through the environmental assessment
('EA') process. Our Saskatoon-based exploration team has a
tremendous track record of making high-grade uranium discoveries –
transforming the Wheeler River project into the largest undeveloped
uranium project in the infrastructure rich eastern portion of the
Athabasca Basin."
Andy Yackulic, P. Geo., Denison's
Director, Exploration, added, "The new high-grade
mineralization at K West was discovered with our second last drill
hole of the season. As a result, there remains potential for
us to delineate a broader mineralized zone, as the new mineralized
intersection is open on section to the footwall side of WR-741AD2
and for several hundred metres along strike in both
directions. The exploration team is also very interested in
the presence of high-grade nickel mineralization along the margins
of the uranium mineralization – as this type of zonation presents
very similarly to other well-known and sizeable high-grade
unconformity uranium deposits in the Athabasca Basin, including Cigar Lake,
Fox Lake, Tamarack, and Key
Lake."
This press release constitutes a "designated news release"
for the purposes of the Company's prospectus supplement dated
November 13, 2020 to its short form
base shelf prospectus dated April 2,
2020.
K-West
K West is located in the northwest portion of the Wheeler River
property. The K West fault is the primary exploration target in
this area, which lies within the K West conductive trend, at or
near the contact between a graphitic pelite and underlying Archean
granite. The K West fault has been drill-defined over a
strike length of approximately 15 km, on both the Wheeler River
property and on adjacent properties located to the north of Wheeler
River, where several zones of high-grade unconformity-hosted
mineralization have been identified (including on Denison's 30%
owned Mann Lake property). Historical drilling at K-West, which has
been interpreted to have intersected the unconformity anywhere from
30 to 100 metres hangingwall of the K West fault, has defined a
broad zone of anomalous uranium pathfinder geochemistry,
specifically copper, nickel, and cobalt.
A total of 6 drill holes were completed at K-West as part of the
2020 exploration program, including drill hole WR-741AD1, which was
designed to test the up-dip projection of the K West fault
intersected in 2018 by drill hole WR-741A. WR-741AD1, drilled at an
azimuth of 295.7° and an inclination of -71.0°, intersected
weak mineralization hosted within a narrow breccia approximately 3
metres below the unconformity, located at the upper contact of the
K-West fault. In addition, composite sandstone samples from
WR-741AD1 returned highly anomalous copper and nickel
concentrations over the lower 310 metres of the sandstone
column.
WR-741AD2 was drilled 10 metres to the northwest of WR-741AD1,
at an azimuth of 294.3° and an inclination of -63.0°, to test
the extents of the mineralization identified below the
unconformity. As noted above, WR-741AD2 intersected
high-grade uranium mineralization that is interpreted to straddle
the unconformity contact. In addition, low grade
mineralization was also encountered straddling the unconformity in
WR-775, drilled at an azimuth of 282.0° and an inclination of
-74.0°, located approximately 400 metres to the south of WR-741AD2.
SeeTable 1 below for the applicable assay results, Figure 1 for a
property map of Wheeler River and Figure 2 for a map of K West
illustrating the location of the 2020 drilling.
Table 1 – K West Zone Mineralized
Intersections
Hole-ID
|
From
(m)
|
To
(m)
|
Length
(m) 3
|
U3O8(%)
|
WR-741AD11
|
644.8
|
647.8
|
3.0
|
0.42
|
WR-741AD21
|
640.3
|
644.3
|
4.0
|
2.14
|
(includes)2
|
643.3
|
644.3
|
1.0
|
7.66
|
WR-7751
|
594.4
|
595.4
|
1.0
|
0.30
|
Notes:
|
(1) Intersection
interval is composited above a cut-off grade of 0.1%
U3O8
|
|
(2) Intersection
interval is composited above a cut-off grade of 1.0%
U3O8
|
|
(3) Lengths
indicated are the down-hole length and do not represent the true
thickness of mineralization
|
M Zone
Regional exploration drilling was also completed at the M Zone
target area during the 2020 Wheeler River exploration program. M
Zone is located approximately 5.5 kilometres east of Phoenix and lies roughly 700 metres from the
McArthur River – Key Lake haul road. Denison's exploration team
conducted a core-relogging program in 2018 and identified several
historical drill holes at M Zone that encountered indicative
structure, alteration, elevated radioactivity, or anomalous
pathfinder geochemistry worthy of follow-up.
A total of 4 drill holes were completed at M Zone as part of the
2020 exploration program, including drill hole WR-778, which was
designed to test the subcrop of a graphitic fault at the
sub-Athabasca unconformity that
was previously intersected at depth in DDH ZM-17. WR-778,
drilled at an azimuth of 304° and an inclination of -80.0°,
intersected a wide reverse fault zone in the lower sandstone,
highlighted by multiple basement wedges, intense hydrothermal
alteration, and a broad interval of weak uranium
mineralization.
The presence of basement wedges in WR-778 and an interpreted
unconformity elevation offset of 25 metres indicates that the broad
zone of weak mineralization is controlled by a large reverse fault.
See Figure 1 for a property map of Wheeler River and Figure 3 for a
map illustrating the location of the 2020
M Zone drilling.
Weak uranium mineralization was returned along the nose of
basement wedges within a broad reverse fault zone, as summarized in
Table 2 below. The mineralized intervals are reported as the
radiometric equivalent uranium derived from a total gamma down-hole
probe ("eU3O8") due to extensive core
loss. Taken together, the results from WR-778 present a model
that may be similar to Zone 4 at McArthur River. While the
mineralization at M Zone is significantly lower grade than
McArthur, there are many similarities and future exploration
drilling is expected to test if the area is analogous to Zone 4 at
McArthur River.
Table 2 – M Zone Mineralized Intersection
Hole-ID
|
From
(m)
|
To
(m)
|
Length
(m) 3
|
eU3O8(%)1
|
WR-7782
|
397.1
|
407.3
|
10.2
|
0.08
|
And
|
411.2
|
414.2
|
3.0
|
0.08
|
Notes:
|
(1) Due to core
loss, the interval is reported as radiometric equivalent
U3O8 ("eU3O8")
derived from a calibrated total gamma downhole probe
|
|
(2) Intersection
interval is composited above -a cut-off grade of 0.1%
eU3O8
|
|
(3) Lengths
indicates are the down-hole length and do not represent the true
thickness of mineralization
|
Sampling and Assay Procedures
Drill core with anomalous total gamma radioactivity (>300
counts per second using a RS-120 or RS-125 scintillometer) was
sampled over 0.5 metre intervals. Sampling is undertaken on site by
splitting the core in half, with one half submitted for analysis
and the other half retained in the core box for future reference.
Uranium chemical assays are performed by the Saskatchewan Research
Council ("SRC") Geoanalytical Laboratories located in Saskatoon. Sample preparation involves
crushing and pulverizing core samples to 90% passing -106 microns.
Splits of the resultant pulps are initially submitted for
multi-element ICP-MS analysis following partial (HNO3:HCl) and
total (HF:HNO3:HClO4) digestions. Samples with ≥ 1,000 ppm U
(partial digest) are re-assayed for U3O8
using an ISO/IEC 17025:2005 accredited method for the determination
of U3O8 weight %. Pulp splits are digested
using aqua-regia and the solution analyzed for
U3O8 weight % using ICP-OES. In addition
to internal checks by SRC Geoanalytical Laboratories, the Company
has rigorous quality assurance and quality control ("QAQC")
procedures including the insertion of standard reference materials,
blanks and field duplicates. The assay data is subject to
verification procedures by qualified persons employed by Denison
prior to disclosure. For further details on the assay, QAQC and
data verification procedures please see Denison's Annual
Information Form dated March 13, 2020
filed under the Company's profile on SEDAR (www.sedar.com).
Use of Radiometric Equivalent Grades
The Company typically reports results as preliminary radiometric
equivalent grades ("eU3O8"), derived from a
calibrated downhole total gamma probe during active exploration
programs, and subsequently reports definitive assay grades
following sampling and chemical analysis of the mineralized drill
core. In the case where core recovery within a mineralized
intersection is less than 80%, radiometric grades are considered to
be more representative of the mineralized intersecton and may be
reported in the place of assay grades. Radiometric equivalent probe
results are subject to verification procedures by qualified persons
employed by Denison prior to disclosure. For further details on the
total gamma downhole probe methods employed by Denison, QAQC
procedures and data verification procedures please see Denison's
Annual Information Form dated March 13,
2020 filed under the Company's profile on SEDAR
(www.sedar.com).
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 – including 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
project is host to the high-grade Phoenix and Gryphon uranium deposits,
discovered by Denison in 2008 and 2014, respectively, and is a
joint venture between Denison (90% and operator) and JCU
(Canada) Exploration Company
Limited (10%).
The Wheeler River Pre-Feasibility Study ("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 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 is 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.
Denison suspended certain activities at Wheeler River during
2020, including the formal Environmental Assessment ("EA") process,
which is on the critical path to achieving the project development
schedule outlined in the PFS. On November 9, 2020, Denison announced its decision
to resume the formal EA process for the Project in January 2021. The Company is not currently able
to estimate the impact to the project development schedule outlined
in the PFS, and users are cautioned against relying on the
estimates provided therein regarding the start of pre-production
activities in 2021 and first production in 2024.
About Denison
Denison is a uranium exploration and development company with
interests focused in the Athabasca
Basin region of northern Saskatchewan,
Canada. In addition to the Wheeler River project, Denison's
Athabasca Basin exploration
portfolio consists of numerous projects covering over 250,000
hectares. Denison's interests in the Athabasca Basin also 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 currently processing ore from the Cigar Lake mine under a toll
milling agreement, plus a 25.17% interest in the Midwest and
Midwest A deposits, and a 66.90% interest in the Tthe Heldeth Túé
("THT", formerly J Zone) and Huskie deposits on the Waterbury Lake
property. Each of Midwest, Midwest A, THT and Huskie are located
within 20 kilometres of the McClean Lake mill.
Denison is engaged in mine decommissioning and environmental
services through its Closed Mines group (formerly Denison
Environmental Services), which manages Denison's Elliot Lake reclamation projects and provides
post-closure mine care and maintenance services to a variety of
industry and government clients.
Denison is also the manager of Uranium Participation Corp., a
publicly traded company which invests in uranium oxide and uranium
hexafluoride.
Follow Denison on Twitter @DenisonMinesCo
Qualified Persons
The technical information contained in this release has been
reviewed and approved by Mr. Andrew
Yackulic, P. Geo., Denison's Director, Exploration, who is a
Qualified Person in accordance with the requirements of NI
43-101.
Cautionary Statement Regarding Forward-Looking
Statements
Certain information contained in this news 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 news release contains forward-looking
information pertaining: the interpretation of the results from the
2020 regional exploration program, underlying assumptions and the
Company's intentions with respect thereto; the results of the PFS
and expectations with respect thereto, including the duration and
scope of impacts of the COVID-19 pandemic and affiliated
operational adjustments; development and expansion plans and
objectives, including plans for a feasibility study; and
expectations regarding its joint venture ownership interests and
the continuity of its agreements with its partners.
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, areas of interest for further exploration selected
based on interpretation of current and historic exploration may not
result in findings of significance after further testing.
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 13, 2020
or subsequent quarterly financial reports 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 news 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 news release. Denison does not undertake any obligation to
publicly update or revise any forward-looking information after the
date of this news 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 presentation 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.
This press release contains information relating to third
parties derived from third-party publications and/or reports which
Denison believes are reliable but have not been independently
verified by the Company.
Figure 1 – Wheeler RIver 2020 Regional
Exploration
Figure 2 – K West Zone 2020
Drilling
Figure 3 – M Zone 2020 Drilling
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SOURCE Denison Mines Corp.