Denison Mines Corp. (TSX:DML) (NYSE Amex:DNN) ("Denison" or the
"Company") announces that its 2012 operating plan forecasts
production of 1.4 million pounds U3O8 and 0.6 million pounds V2O5
from its operations in the United States. "The 2012 plan is focused
on increasing uranium production, reducing operating costs and
growing our resource base through exploration, in particular in the
Athabasca Basin in Canada on the Wheeler River project and in
Zambia on the 100% owned Mutanga project" said Ron Hochstein,
President and CEO of Denison. Unless otherwise stated all figures
are in U.S. dollars.
2012 Operating Plans
Production
Denison's uranium production from its 100% owned White Mesa
mill, located in Blanding Utah, is expected to increase over 40%
from 2011 production, to an estimated 1.4 million pounds U3O8 from
conventional ore and alternate feed sources. In 2012, approximately
900,000 pounds are expected to be produced from ore delivered from
the Company's Beaver, Pandora, Daneros and Arizona 1 mines, while
the remainder will be produced from alternate feed production. Ore
production from the Company's Pinenut mine, located in north
central Arizona, is expected to begin in May 2012. Vanadium
production is projected to be approximately 600,000 pounds V2O5.
The decrease in vanadium production compared to 2011 is because the
mill is planned to process only non-vanadium ores from Arizona 1
and Daneros, until late 2012. There will be no production from the
McClean Lake mill in the Athabasca Basin in Canada, as that mill
remains on stand-by in anticipation of resuming operations in 2013
to process Cigar Lake ores.
The cash cost of production is expected to average approximately
$33.50 per pound of U3O8 net of vanadium credits, excluding sales
royalties and mine stand-by expenditures. The anticipated decline
in operating cost, as compared to 2011, is due to the different
types of ore that the White Mesa mill is expected to process in
2012 combined with an expected decline in the price of key
reagents. Sustaining capital expenditures at the mines and mill
facilities are estimated at $15.3 million.
Sales
Uranium sales are forecasted to be approximately 1.6 million
pounds of U3O8 of which 730,000 pounds will be sold into long term
contracts and the remainder will be sold on the spot market.
Vanadium sales are projected to be 500,000 pounds V2O5 in 2012.
Business Development
In 2012 Denison plans to continue to aggressively pursue its
exploration and development projects in Canada, the U.S., Mongolia
and Zambia. Total expenditures on development and exploration
projects in 2012 are estimated at $25.4 million.
In Canada, Denison will manage or participate in nine
exploration programs, of which Wheeler River will continue to be
the primary focus. The total budget for these programs is Cdn$11.7
million of which Denison's share is Cdn$7.8 million. At Wheeler
River, a 28,000 metre winter and summer drill program and
geophysical surveys are planned at a total cost of Cdn$6.8 million
(Denison's share Cdn$4.1 million). Exploration work will also be
carried out on the Moore Lake, Hatchet Lake, Murphy Lake, Bell
Lake, Ahenakew Lake, South Dufferin, McClean Lake and Wolly
projects at a budgeted cost of Cdn$4.9 million (Denison's share
Cdn$3.7 million).
In the United States, drilling is planned on the La Sal complex
to attempt to expand resources at the Beaver and Pandora mines and
on certain of its other properties. The total planned cost of the
U.S. exploration program is $1.2 million. In 2011, the exploration
program on the La Sal trend identified resources that more than
replaced the production from this area last year. In addition to
the drilling, the Company plans on preparing mineral resource
estimates in accordance with National Instrument 43-101
("NI43-101") for the Redd Block area in the La Sal Complex and the
Daneros operation in 2012.
In Canada and the U.S., a total of $5.4 million is budgeted to
be spent by Denison on development stage projects in 2012. In the
United States, development of the Canyon mine is anticipated to
move forward late in the first quarter, with the start of shaft
sinking planned to begin late 2012. Denison expects to advance
permitting for the EZ1/EZ2 deposits in Arizona and the Redd Block
mine located west of the Beaver mine in Utah. The cost of these
programs is estimated at $4.8 million. In Canada, the McClean North
underground development feasibility study is expected to be
advanced to include the Sue D and Caribou deposits, along with
continued evaluation and approval of the Environmental Assessment
for the Midwest development project. Both of these projects are
operated by AREVA Resources Canada Inc.
In Zambia, the Company plans to follow up on its successful 2011
drill program on its 100% owned Mutanga project. Mineral resource
estimates, based on the 2011 drilling and prepared in accordance
with NI43-101 are anticipated to be released late in the first
quarter. In April, a 15,000 metre exploration drill program will
begin, which will focus on several targets that have been
identified near the existing resources. The Zambian program will
total an estimated $7.1 million.
In Mongolia, mining licence applications for four of its five
license areas were submitted in 2011 and the Company is in the
process of acquiring the Russian interest in the Gurvan Saihan
Joint Venture, in preparation for restructuring the joint venture
to meet the requirements of the Mongolian Nuclear Energy Law. In
2012, a $4.1 million exploration and development program is
projected, contingent upon receipt of the mining licences in
mid-2012. Included in this budget is a $1.6 million, 17,500 metre
exploration program focussed on the Ulziit and Urt Tsav 2011
discoveries. The development activities will include drilling of
initial test patterns and pilot plant design.
2011 PRODUCTION AND SALES
Denison's uranium and vanadium production in 2011 was
approximately 1.0 million pounds U3O8 and 1.3 million pounds V2O5
from its White Mesa mill in Utah. The mill resumed processing
conventional ore in November of 2011, but production was lower than
expected due to more difficult operating conditions with the
Daneros ore. The uranium shortfall is expected to be recovered in
2012.
Uranium sales in 2011 totalled 1.1 million pounds U3O8 at an
average realized price of $58.04 per pound U3O8. Vanadium sales in
2011 were 1.8 million pounds V2O5 equivalent, at an average
realized price of $6.21 per pound V2O5.
About Denison
Denison Mines Corp. is an intermediate uranium producer with
production in the U.S., combined with a diversified development
portfolio of projects in the U.S., Canada, Zambia and Mongolia.
Denison's assets include its 100% ownership of the White Mesa mill
in Utah and its 22.5% ownership of the McClean Lake mill in
Saskatchewan. The Company also produces vanadium as a co-product
from some of its mines in Colorado and Utah. Denison owns interests
in world-class exploration projects in the Athabasca Basin in
Saskatchewan, including its flagship project at Wheeler River, and
in the southwestern United States, Mongolia and Zambia. Denison is
the manager of Uranium Participation Corporation (TSX:U), a
publicly traded company which invests in uranium in concentrates
and uranium hexafluoride.
Cautionary Statements Regarding Forward Looking Information
Certain information contained in this press release constitutes
"forward-looking information", within the meaning of the United
States Private Securities Litigation Reform Act of 1995 and similar
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"
or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not
anticipate", or "believes", 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".
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.
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 correct and such
forward-looking information included in this press release should
not be unduly relied upon. This information speaks only as of the
date of this press release. In particular, this press release may
contain forward-looking information pertaining to the following:
the estimates of Denison's mineral reserves and mineral resources;
estimates regarding Denison's uranium and vanadium production
levels and sales volumes; capital expenditure programs, estimated
production costs, exploration and development expenditures and
reclamation costs; expectations of market prices and costs; supply
and demand for uranium and vanadium; possible impacts of litigation
and regulatory actions on Denison; exploration, development and
expansion plans and objectives; Denison's expectations regarding
raising capital and adding to its mineral reserves and resources
through acquisitions and development; and receipt of regulatory
approvals, permits and licences and treatment under governmental
regulatory regimes.
There can be no assurance that such statements will prove to be
accurate, as Denison's actual results and future events could
differ materially from those anticipated in this forward-looking
information as a result of those factors discussed in or referred
to under the heading "Risk Factors" in Denison's Annual Information
Form dated March 28, 2011, available at http://www.sedar.com, and
in its Form 40-F available at http://www.sec.gov, as well as the
following: global financial conditions, the market price of
Denison's securities, volatility in market prices for uranium and
vanadium; ability to access capital, changes in foreign currency
exchange rates and interest rates; liabilities inherent in mining
operations; uncertainties associated with estimating mineral
reserves and resources and production; uncertainty as to
reclamation and decommissioning liabilities; failure to obtain
industry partner and other third party consents and approvals, when
required; delays in obtaining permits and licenses for development
properties; competition for, among other things, capital,
acquisitions of mineral reserves, undeveloped lands and skilled
personnel; public resistance to the expansion of nuclear energy and
uranium mining; uranium industry competition and international
trade restrictions; incorrect assessments of the value of
acquisitions; geological, technical and processing problems; the
ability of Denison to meet its obligations to its creditors;
actions taken by regulatory authorities with respect to mining
activities; the potential influence of or reliance upon its
business partners, and the adequacy of insurance coverage.
Accordingly, readers should not place undue reliance on
forward-looking statements. These factors are not, and should not
be construed as being, exhaustive. 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. The forward-looking information contained in this press
release is expressly qualified by this cautionary statement.
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.
Contacts: Denison Mines Corp. Ron Hochstein President and Chief
Executive Officer (416) 979-1991 Extension 232 Denison Mines Corp.
Jim Anderson Executive Vice President and CFO (416) 979-1991
Extension 372
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