Wheeler River moves towards development

Denison's board of directors and the WRV approved advancement of the project following an assessment of the results of a recently filed NI43-101 compliant pre-feasibility study (PFS). Work will now begin on an environmental assessment (EA) process, with submission of a project description (PD) to federal and provincial regulatory authorities planned for early 2019. This will begin a multi-year EA, consultation, and permitting processes.

The PFS estimated that it would take 3-4 years to receive approvals under existing Canadian regulations, allowing for construction to commence in 2022 with first production planned by 2024. Submitting the PD for the Phoenix operation in 2019 and bringing forward the Gryphon operation at a later date will simplify the permitting process and reduce the capital required to move to a definitive development decision, the company said. First production from Gryphon is currently anticipated by 2030.

Denison also plans to begin ISL wellfield tests, and next year will drill 15-20 wells into the Phoenix deposit to assess permeability by completing pump and other hydraulic tests within the ore zone. These wells will also allow for the collection of additional groundwater and ore samples, as well as helping to refine the estimated cost of wellfield development.

Metallurgical ISL pilot plant testing will see extensive laboratory studies to replicate the ISL flowsheet to test and optimise the mineral processing aspects of the Phoenix operation, with studies to assess lixiviant chemistry and performance under a variety of permeability and grade conditions.

Exploration activities in 2019 will focus on evaluating high priority regional target areas by focusing on initial testing of targets at the sub-Athabasca unconformity. This could lead to the discovery of further uranium deposits that may be amenable to ISL mining, Denison said.

Denison President and CEO David Cates said the Wheeler River PFS suggested the Phoenix ISL operation had the potential to have the industry's lowest operating cost per pound of U3O8. The decision to advance the project had been unanimous, he said.

"The initiation of the EA process, as well as engineering and field studies designed to ultimately support a feasibility study, illustrates the company's commitment to achieving the project development timeline outlined in the PFS and claiming the 'pole-position' amongst undeveloped uranium projects in the Athabasca Basin region," he said.

Wheeler River is described by Denison as the largest undeveloped uranium project in the northern Saskatchewan's Athabasca Basin. It has combined indicated mineral resources of 132.1 million pounds U3O8 (50,812 tU) at an average grade of 3.3% U3O8 plus inferred resources of 3 million pounds U3O8 at an average grade of 1.7%. The Phoenix deposit was discovered by Denison in 2008 and the Gryphon deposit in 2014.

The PFS for Phoenix and Gryphon, published in September, estimates mine production of 109.4 million pounds U3O8 over a 14-year mine life.

Denison owns 90% of the project following its acquisition of Cameco Corp's minority interest in September.