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Denison Mines Corp. (TSX:DML - News) (AMEX:DNN - News) ("Denison" or
the "Company") announces that its 2011 operating plan forecasts
production of 1.2 million pounds U3O8 and 2.2 million pounds V2O5 from its
operations in the United States. "The 2011 plan and budget is focused on
the growth of the Company with the largest exploration program ever
undertaken on our Wheeler River project, the recommencement of drilling on
our Zambian project and the development of our second mine on the Arizona
Strip" said Ron Hochstein, President and CEO of Denison. Unless
otherwise stated all figures are in U.S. dollars.
2011 Operating Plans
Production
Denison's uranium production is
expected to total 1.2 million pounds of U3O8 from ore in stockpile and from
the Beaver, Pandora and Arizona 1 mines and production from the alternate
feed circuit at the White Mesa Mill in the United States. Vanadium production
is projected to total approximately 2.2 million pounds of V2O5. The White
Mesa mill is anticipated to continue processing conventional ore during most
of 2011, except for scheduled maintenance shutdowns. Production of alternate
feed material will continue throughout 2011. The cash cost of production is
expected to average approximately $43.50 per pound of U3O8 net of vanadium
credits, excluding sales royalties. The cash cost per pound reflects the
impact of an increase of over 200% of the cost of sulphuric
acid as compared to 2010. Capital expenditures on the mines and mill
facilities are estimated at $9.7 million.
Sales
Uranium sales are forecast to be
approximately 1.3 million pounds of U3O8 of which just over 500,000 pounds
will be sold into long term contracts and the remainder will be sold on the
spot market. Vanadium sales are projected to be 2.8 million pounds V2O5 in
2011.
Business Development
Denison's business development
activities include advancement of its existing development stage projects and
exploration projects and the search for new potential acquisitions. These
activities, as part of its Five Year Business Development Plan, are aimed at
increasing Denison's sustainable uranium production to at least 10 million
pounds per year by 2020.
In 2011, Denison will participate
in exploration programs in Canada and the United States. The total budget for
these programs will be $15.0 million of which Denison's share will be $8.8
million. The Wheeler River program at a total cost of $10.0 million
(Denison's share $6.0 million) represents the most significant of these
programs. A 35,000 metre drilling program has begun
to test additional areas with known uranium mineralization along the same
mineralized trend hosting the Phoenix deposit.
Exploration work in Canada will
also be carried out on the Moore Lake, Hatchet Lake, Murphy Lake, Bell Lake, McClean Lake and Wolly projects
at a total cost of $3.8 million (Denison's share $1.6 million). In the United
States, drilling is planned on the Beaver mine trend and at the Sunday
Complex to outline potential resources which could extend the life of
existing operations on these properties. In Arizona, an exploration program
on the Company's DB1 breccia pipe is planned. The total cost of the U.S.
exploration program is $1.3 million.
The Company is pleased to announce
that exploration and development activities will be restarted at its Mutanga project in Zambia. A 17,000 metre
exploration drill program will follow up on positive drilling results
obtained in 2009 and metallurgical test work will be undertaken to further
define process design criteria and operating costs. The Zambian program will
total an estimated $6.2 million.
In Mongolia, a $7.4 million
exploration and development program is projected. A $3.0 million, 38,000 metre exploration program is anticipated to be undertaken
on license areas that currently do not have defined resources in order to
confirm resources and support future work on these license areas. Development
activities on license areas which are more advanced will include drilling of
initial test patterns and pilot plant design. The implementation of the
Mongolian program is contingent upon resolution of outstanding issues with
the Mongolian Government regarding the Nuclear Energy Law and the structure
of the Gurvan Saihan
Joint Venture. The Company remains hopeful that these issues will be resolved
early in 2011 such that the planned programs can be completed.
In Canada and the U.S., a total of
$6.4 million will be spent by Denison on development stage projects in 2011.
In the United States, development of the Pinenut
mine is moving forward with initial production anticipated in early 2012, and
permitting will be advanced for the EZ1/EZ2 and Canyon deposits. The cost of
these programs is estimated at $5.6 million. In Canada, the McClean North underground development feasibility study
will be advanced along with continued evaluation of the Midwest development
project under the operatorship of majority owner AREVA Resources Canada Inc.
2010 PRODUCTION AND SALES
Denison's uranium production in
2010 was 1.4 million pounds U3O8 from its U.S. operations and its 22.5% share
of production from the McClean Lake operation in
the Athabasca basin in Canada. Vanadium production totalled
2.3 million pounds V2O5 from its White Mesa mill in Utah.
Uranium sales in 2010 totalled 1.8 million pounds U3O8 at an average realized
price of $47.67 per pound U3O8. Vanadium sales in 2010 sales were 2.4 million
pounds V2O5 equivalent, at an average realized price of $6.33 per pound V2O5.
About Denison
Denison Mines Corp. is a mid-sized
uranium producer in North America, with mining assets in the Athabasca Basin
region of Saskatchewan, Canada and the southwest United States including
Colorado, Utah, and Arizona. The Company has ownership interests in two
conventional uranium mills in North America. Denison also has a strong
exploration and development portfolio including the Phoenix discovery in the
Athabasca Basin as well as large land positions in the United States, Canada,
Mongolia and Zambia.
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" or "be
achieved" and "has the potential to".
Forward looking statements are
based on the assumptions noted in this press release and 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 is 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; uranium and vanadium production 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 on Denison; exploration, development, production and
expansion plans and objectives; Denison's expectations regarding raising
capital and adding to its mineral reserves through acquisitions and
development; and receipt of regulatory approvals and permits 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 19, 2010, available at http://www.sedar.com
and its Form 40-F for the financial year ended December 31, 2009, available
at http://www.sec.gov, as well as the following: global financial conditions;
volatility in market prices for uranium and vanadium; changes in foreign
currency exchange rates and interest rates; the market price of Denison's
securities; the ability to access capital; the ability of Denison to meet its
obligations to its creditors; liabilities inherent in mining operations;
uncertainties associated with estimating mineral reserves and resources;
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;
incorrect assessments of the value of acquisitions; geological, technical and
processing problems; and, the potential influence of, or reliance upon, a
business partner.
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.
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