Denison Mines files positive NI 43-101 tech report for Waterbury Lake Project
Denison Mines Corp. [DML-TSX; DNN-NYSE American] filed a NI 43-101 compliant technical report entitled “Preliminary Economic Assessment for the Tthe Heldeth Tue (J Zone) deposit, Waterbury Lake Property, Northern Saskatchewan, Canada” with an effective date of October 30, 2020.
There are no material differences contained in the technical report from the information previously disclosed in the preliminary economic assessment (PEA) release. As outlined in the PEA release, the PEA evaluates the potential use of the in situ recovery (ISR) mining method at the Tthe Heldeth Tue deposit (THT, formerly named J Zone) with associated processing at Denison’s 22.5%-owned McClean Lake mill. The PEA was prepared by Engcomp Engineering & Computing Professionals of Saskatoon, and demonstrates robust economics for a small-scale Athabasca basin ISR uranium mining project – including low initial capital costs, low operating costs and globally competitive all-in costs.
Mine life would be ~6 years averaging ~1.6 million lbs U3O8 per year. Average cash operating costs are US$12.23/lb U3O8. Initial capital costs are $112 million. Base case pre-tax IRR is 39.1% with base case pre-tax NPV at $177 million. All-in cost is US$24.93/lb U3O8.
The freeze wall design expected to reduce technical risk and upfront capital costs. Full hydraulic containment of the orebody during mining activities has been planned for the project with the installation of a freeze wall from surface to the basement rocks underlying the THT deposit — effectively creating containment 360 degrees around the deposit. This design makes use of established ground-freezing technology and conventional diamond drilling to create a physical perimeter around the deposit — containing the mining solution used in the ISR mining process and protecting the surrounding environment to minimize environmental impacts of the project.
Waterbury Lake is owned by the Waterbury Lake Uranium Limited Partnership (WLULP), of which Denison Waterbury Corp. (a wholly owned subsidiary of Denison) owns 66.90% and Korea Waterbury Lake Uranium Limited Partnership (KWULP) owns 33.10%. KWULP comprises a consortium of investors, in which Korea Hydro & Nuclear Power (KHNP) holds a majority position. KHNP is also a significant shareholder in Denison.