TORONTO, Aug. 4, 2021 /PRNewswire/ - Denison Mines
Corp. ("Denison" or the "Company") (TSX: DML) (NYSE
American: DNN) is pleased to report positive interim results from
the ongoing metallurgical test program for the planned In-Situ
Recovery ("ISR") mining operation at the Phoenix uranium deposit ("Phoenix"), located
on the Company's 90% owned Wheeler River Uranium Project ("Wheeler
River" or the "Project"). Test work completed to date, has
consistently supported an ISR mining uranium head-grade for
Phoenix in excess of the 10 grams
/ Litre ("g/L") assumed 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 uranium bearing solution ("UBS") to be recovered from the
well-field. View PDF version.
David Bronkhorst, Denison's Vice
President Operations, commented, "The metallurgical testing
completed to date demonstrates that uranium can be consistently
recovered from Phoenix cores at
levels significantly higher than the 10 g/L extraction rate used in
the PFS – giving rise to a decision to adapt future unit operation
metallurgical tests to use a UBS head-grade of 15 g/L.
A 50% increase in head-grade is expected to translate into
meaningful optimization of previously estimated operating
parameters and processing plant designs while maintaining the same
level of annual uranium production – with the potential to reduce
operating costs related to on-surface processing activities, and
initial capital costs associated with the processing
plant."
Phoenix is expected to be mined
in several phases, with Phase 1 estimated to contain 22.2 million
pounds U3O8 (37,242 tonnes at 27.1%
U3O8, above a cut-off grade of 0.8%
U3O8) in Probable mineral reserves (see Press
Release dated December 1, 2020).
Accordingly, the sample selection for recent metallurgical test
work has favored samples representative of the mineralization in
Phase 1, to allow for a greater understanding of optimal leaching
conditions required in the area where first production is
expected.
Core Leach Test Results
Three core samples, representing the high-grade/low-clay
characteristics of the majority of the mineralization in the Phase
1 mining area, have been tested to date, with results summarized
below in Table 1 – showing steady-state and average UBS head grades
significantly above the 10g/L level used in the PFS.
Table 1 –
Summary Results from High-Grade/ Low clay Core Leach
Tests
|
|
Sample
#1
|
Sample
#3A
|
Sample
#3C
|
Sample
diameter
|
6.1 cm
|
8.1 cm
|
7.8 cm
|
Sample
length
|
19 cm
|
18 cm
|
7cm
|
Sample grade
(U3O8)
|
70%
|
83%
|
83%
|
Clay
Content
|
Low
|
Low
|
Low
|
UBS range in
steady state (U)
|
13.5 g/L to 39.8
g/L
|
29g/L to
90g/L
|
14g/L to
74g/L
|
UBS average
interval (U)
|
22g/L over 56
days
|
29.6 g/L over 85
days
|
31.1 g/L over 64
days
|
In addition to the high-grade/low clay characteristics of Phase
1, the Phoenix ISR operation is also expected to encounter
comparatively rare and isolated areas with lower uranium grades and
high clay content, which is expected to result in a limited number
of zones of reduced permeability. In order to understand the ISR
leach dynamics in these areas, test work was also initiated on
samples presenting high clay characteristics (above 25% clay).
Results obtained from these tests confirm that high clay content
can impact the natural permeability of the ore body and lead to
lower UBS head-grades. Importantly, these tests also confirm
that permeability enhancement techniques have the potential to
normalize these areas and significantly improve UBS head-grade
concentrations to levels that align with core leach tests carried
out using samples with higher grades and lower clay
content.
As outlined in Table 2, below, sample 2A failed to produce an
acceptable "steady-state" UBS head grade. Sample 2B was taken from the same drill hole and
presented similar mineralogical characteristics as Sample 2A;
however, Sample 2B was modified to
simulate the MaxPERF permeability enhancement tool. As is
evident from the achievement of a peak UBS head-grade of 76 g/L and
an average UBS head-grade of 24.9 g/L obtained over 28 days of
steady state, the preliminary leaching results from Sample
2B confirm both the utility of
permeability enhancement in normalizing the natural permeability in
high clay zones and the appropriateness of the decision to increase
the overall UBS head-grade assumption for Phoenix.
Table 2 –
Summary Results from medium Grade/ High clay Core Leach
Tests
|
|
Sample
#2A
|
Sample
#2B(1)
|
Sample
diameter
|
61mm
|
61mm
|
Sample
length
|
12cm
|
10cm
|
Sample grade
(U3O8)
|
28%
|
28%
|
Clay
Content
|
High
|
High
|
Permeability
Enhancement
|
No
|
Yes
|
UBS range in
steady state (U)
|
N/a
|
5.8g/L to 76.0
g/L
|
UBS average
interval (U)
|
3.8g/L over 1
day
|
24.9 g/L over 28
days
|
Notes:
|
(1) Core test is
still in progress. Results are as of August 3,
2021.
|
Column Leach Tests
Various column leach tests have recently been completed using
core samples from Phoenix. The
primary purpose of the column leach tests was to recover sufficient
volumes of UBS to facilitate bench-scale tests of the unit
operations outlined in the flowsheet for the Phoenix processing plant. Over 900
litres of UBS were produced from 64 Kilograms ("kg") of
Phoenix core samples. Combined
results from the four column leach tests are highly positive, with
calculated UBS head-grade from the four columns averaging 19g/L,
which further supports the decision to increase the overall UBS
head-grade assumption for Phoenix.
While not the primary purpose of the column leach tests, average
reagent addition rates from the column leach tests (1.3 kg acid /
kg U3O8 and 1.2 kg oxidant / kg
U3O8) have also provided useful information
that is supportive of the values published in the PFS.
The laboratory work for the 2021 Metallurgical Program is being
carried out at the Saskatchewan Research Council ("SRC") Mineral
Processing and Geoanalytical Laboratories, in Saskatoon, under the supervision of Mr.
Chuck Edwards (P.Eng., FCIM).
About Phoenix Phase 1
Phase 1 of Phoenix is estimated to contain
approximately 22.2 million pounds U3O8
(37,242 tonnes at 27.1% U3O8, above a cut-off
grade of 0.8% U3O8) in Probable mineral
reserves. Based on current designs, the Company estimates
approximately 6.6 million pounds U3O8 (7,717
tonnes at 39.2% U3O8, above a cut-off grade
of 0.8% U3O8) in Probable mineral reserves
are contained within the expected operating perimeter of the Test
Pattern (see Figure 1). These estimates are derived as a direct
subset of those reported in the 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 (the "PFS Report").
The key assumptions, parameters and methods used to estimate the
mineral reserves herein remain unchanged.
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%).
A PFS was completed for Wheeler River 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 PFS Report. A copy of the PFS 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. The Company has an effective 95% interest in its
flagship Wheeler River Uranium Project, which is the largest
undeveloped uranium project in the infrastructure rich eastern
portion of the Athabasca Basin
region of northern Saskatchewan.
Denison's interests in Saskatchewan 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 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. Each of Midwest Main, Midwest A, THT and Huskie are
located within 20 kilometres of the McClean Lake
mill.
Through its 50% ownership of JCU (Canada) Exploration Company, Limited ("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 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, 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 to the following: the planned scope,
elements, and objectives of the 2021 ISR field programs, including
the results of the column leach tests, including head grade and
reagent usage results and estimates; other evaluation activities,
including plans for future lixiviant tests and those activities
connected with the EA process; the results of the PFS and
expectations with respect thereto; expectations with respect to
phased development, and the estimates of reserves in each such
phase; other 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, 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 Measured, Indicated and Inferred Mineral Resources and
Probable Mineral Reserves: This press release may use
the terms 'measured', 'indicated' and 'inferred' mineral resources.
United States investors are
advised that while such terms have been prepared in accordance with
the definition standards on mineral reserves of the Canadian
Institute of Mining, Metallurgy and Petroleum referred to in
Canadian National Instrument 43-101 Mineral Disclosure Standards
('NI 43-101') and are recognized and required by Canadian
regulations, these terms are not defined under Industry Guide 7
under the United States Securities Act and, until recently, have
not been permitted to be used in reports and registration
statements filed with the United States Securities and Exchange
Commission ('SEC'). 'Inferred mineral resources' have a great
amount of uncertainty as to their existence, and as to their
economic and legal feasibility. It cannot be assumed that all or
any part of an inferred mineral resource will ever be upgraded to a
higher category. Under Canadian rules, estimates of inferred
mineral resources may not form the basis of feasibility or other
economic studies. 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. In addition, the terms "mineral reserve",
"proven mineral reserve" and "probable mineral reserve" for the
purposes of NI 43-101 differ from the definitions and allowable
usage in Industry Guide 7. Effective February 2019, the SEC adopted amendments to its
disclosure rules to modernize the mineral property disclosure
requirements for issuers whose securities are registered with the
SEC under the Exchange Act and as a result, the SEC now recognizes
estimates of "measured mineral resources", "indicated mineral
resources" and "inferred mineral resources". In addition, the SEC
has amended its definitions of "proven mineral reserves" and
"probable mineral reserves" to be "substantially similar" to the
corresponding definitions under the CIM Standards, as required
under NI 43-101. However, information regarding mineral
resources or mineral reserves in Denison's disclosure may not be
comparable to similar
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SOURCE Denison Mines Corp.