TORONTO, Sept. 22, 2021 /CNW/ - Denison Mines
Corp. ("Denison" or the "Company") (TSX: DML) (NYSE
American: DNN) is pleased to announce that the Wheeler River Joint
Venture ("WRJV") has approved the initiation of an independent
Feasibility Study ("FS" or the "Study") for the In-Situ Recovery
("ISR") mining operation proposed for the Phoenix uranium deposit ("Phoenix" or the
"Project"). The Company is also pleased to announce the
selection of leading global consulting and engineering firm Wood
PLC ("Wood") to lead and author the FS in accordance with Canadian
Securities National Instrument 43-101 ("NI 43-101"). View PDF
version
David Cates, Denison's President
& CEO, commented, "The ISR de-risking activities we've
completed since the publication of the Pre-Feasibility Study
('PFS') for Wheeler River in 2018 have been designed to support the
completion of a future Feasibility Study, and the results to date
have further confirmed the technical viability of the Project –
leading to the decision to advance the Project and initiate the
formal Feasibility Study process.
During this de-risking phase, we have been able to verify
ore-body permeability and the leachability of high-grade uranium in
conditions representative of an ISR mining setting. We've also
engineered an improved containment design using a more conventional
ground freezing approach. Based on the results of field
programs and metallurgical lab testing completed over the last
three years, we are confident that the Project is ready to advance
into a full Feasibility Study. Taken together with the
selection of globally recognized engineering firm Wood, the
decision to launch the formal Feasibility Study process for
Phoenix represents another
important step towards achieving our objective of bringing low-cost
ISR mining to the high-grade uranium deposits of the
Athabasca Basin."
Feasibility Study
The completion of the FS is a critical step in the progression
of the Project and is intended to advance de-risking efforts
to the point where the Company and the WRJV will be able to make a
definitive development decision. Key objectives of the Study
are expected to include:
- Environmental Stewardship: Extensive planning and
technical work undertaken as part of the ongoing Environmental
Assessment ("EA"), including applicable feedback from consultation
efforts with various interested parties, is expected to be
incorporated into the FS project designs to support our aspiration
of achieving a superior standard of environmental stewardship that
meets and exceeds the anticipated environmental expectations of
regulators and aligns with the interests of local Indigenous
communities;
- Updated Estimate of Mineral Resources: Mineral resources
for Phoenix were last estimated in
2018. Since then, additional drilling has been completed in and
around the Phoenix deposit as part
of various ISR field tests, including drill hole GWR-045 (22.0%
eU3O8 over 8.6 metres, see news release dated
July 29, 2021), and exploration
drilling. The updated mineral resource estimate will form the basis
for mine planning in the FS;
- Mine Design Optimization: FS mine design is expected to
reflect the decision to adopt a freeze wall configuration for
containment of the ISR well field (see news release dated
December 1, 2020), as well as the
results from multiple field test programs and extensive
hydrogeological modelling exercises, which have provided various
opportunities to optimize other elements of the Project – including
well pattern designs, permeability enhancement strategies, and both
construction and production schedules;
- Processing Plant Optimization: FS process plant design
is expected to reflect the decision to increase the ISR mining
uranium head-grade to 15 g/L (see news release dated August 4, 2021), as well as the results from
extensive metallurgical laboratory studies designed to optimize the
mineral processing aspects of the Project; and
- Class 3 Capital Cost Estimate: The FS is also intended
to provide the level of engineering design necessary to support a
Class 3 capital cost estimate (AACE international standard with an
accuracy of -15% /+25%), which is expected to provide a basis to
confirm the economic potential of the Project highlighted in the
PFS completed in 2018 (see news release dated September 24, 2018).
Wood PLC
Wood is a global leader in consulting and engineering across
energy and the built environment, helping to unlock solutions to
some of the world's most critical challenges. Wood provides
consulting, project and operational solutions in more than 60
countries and employs around 40,000 people. Importantly, Wood's
Saskatchewan-based team has
significant experience in ISR mining projects as well as
large-scale uranium, potash and solution mining projects. For
more information about Wood, please visit www.woodplc.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 (operator) and JCU (Canada) Exploration Company Limited.
Denison has an effective 95% ownership interest in Wheeler River
(90% directly, and 5% indirectly through a 50% ownership in
JCU).
A PFS was completed for Wheeler River in 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 EA process, which is on the critical path to
achieving the project development schedule outlined in the
PFS. While the EA process has resumed, 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 its effective 95% interest in the
Wheeler River project, Denison's interests in the Athabasca Basin include a 22.5% ownership
interest in the McClean Lake joint venture, which includes several
uranium deposits and the McClean Lake uranium mill that is
contracted to process the ore from the Cigar Lake mine under a toll
milling agreement, plus a 25.17% interest in the Midwest Main 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. The Midwest Main, Midwest A, THT and Huskie deposits are
each located within 20 kilometres of the McClean Lake mill.
Through its 50% ownership of JCU, Denison holds additional
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 also 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.
Follow Denison on Twitter @DenisonMinesCo
Qualified Persons
The technical information contained in this release has been
reviewed and approved by Mr. David
Bronkhorst, P.Eng, Denison's Vice President, Operations and
Mr. Andrew Yackulic, P. Geo.,
Denison's Director, Exploration, who are Qualified Persons 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 to the following: initiation of the FS; the
selection and appointment of Wood to author the FS; the planned
scope, elements, and objectives of the FS, including the plans for
an updated mineral resource estimate, mine design
optimization processing plant optimization and Class 3
capital cost estimate; other evaluation activities, objectives and
expectations, including the ongoing EA and related processes; the
results of the PFS and expectations with respect thereto, including
the designs disclosed to-date and the ability to maintain or build
upon such designs;; other development and expansion plans and
objectives; and expectations regarding its joint venture ownership
interests and the continuity of its agreements with its partners
and third parties.
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 modelling and assumptions upon which the work
plans are based may not be maintained after further testing or be
representative of actual conditions within the Phoenix deposit. In addition, Denison
may decide or otherwise be required to discontinue its field test
activities or other testing, evaluation and development work at
Wheeler River if it is unable to maintain or otherwise secure the
necessary resources (such as testing facilities, capital funding,
regulatory approvals, etc.) or operations are otherwise affected by
COVID-19 and its potentially far-reaching impacts. 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 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 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.
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SOURCE Denison Mines Corp.