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(Kitco News) - Denison Mines (TSX: DML) (NYSE: DNN) today reported the results of the feasibility study (Phoenix FS) completed for in-situ recovery (ISR) mining of the high-grade Phoenix uranium deposit.
The company also announced a cost update (Gryphon Update) to the 2018 pre-feasibility study (2018 PFS) for conventional underground mining of the basement-hosted Gryphon uranium deposit.
Phoenix and Gryphon are part of the Wheeler River uranium project, which is the largest undeveloped uranium mining project in the infrastructure-rich eastern portion of the Athabasca Basin region in northern Saskatchewan, Canada. Denison has an effective 95% ownership interest in Wheeler River and is the project operator.
According to a press release, Phoenix FS highlights include base case pre-tax NPV8% of $2.34 billion (100% ownership-basis), which is a 150% increase in the base-case pre-tax NPV8% for Phoenix from the 2018 PFS, and “very robust” base-case pre-tax IRR of 105.9%.
The project’s base-case after-tax NPV8% is $1.56 billion (100% basis) and IRR is 90.0% – with Denison's effective 95% interest in the project equating to a base-case after-tax NPV8% of $1.48 billion.
The company said that with the successful completion of the Phoenix FS, Denison has advanced the planned Phoenix ISR project through the technical de-risking process and has already commenced the first phases of project execution.
Denison added that Gryphon Update includes base case pre-tax NPV8% of $1.43 billion (100% basis), which is a 148% increase in the base-case pre-tax NPV8% for Gryphon from the 2018 PFS, as well as “strong” base-case pre-tax IRR of 41.4%.
The project’s base-case after-tax NPV8% is $864.2 million (100% basis) and IRR of 37.6% – with Denison's effective 95% interest in the project equating to a base-case after-tax NPV8% of $821.0 million.
President and CEO David Cates commented, "The Phoenix FS and Gryphon Update confirm the robust economics of the two projects situated within the company's flagship Wheeler River property, producing base-case after-tax net present values of $1.6 billion and $0.9 billion, respectively.
“After 4.5 years of rigorous technical de-risking and independent third-party validation, Phoenix has cemented its position as one of the lowest-cost uranium development projects in the world. While most contemporary uranium development projects have not yet been tested against current cost inflation, the results of the Phoenix FS and Gryphon Update demonstrate that Denison continues to be uniquely positioned to become a meaningful uranium producer with multiple low-cost development assets.”
“With the highly positive results of the Phoenix FS, our team has already shifted focus to advancing front-end engineering and design efforts, with a target of transitioning into detailed design before the end of the year," he added.
Denison is a uranium exploration and development company with interests focused in the Athabasca Basin region of northern Saskatchewan, Canada.
