Denison Reports Initial Results from Isr Field Test at Phoenix Test Area 2 and Advancement to Commercial Scale Wells
Denison Mines Corp.
1100 – 40 University Ave
Toronto, ON M5J 1T1
www.denisonmines.com
PRESS RELEASE
DENISON REPORTS INITIAL RESULTS FROM ISR FIELD TEST AT PHOENIX
TEST AREA 2 AND ADVANCEMENT TO COMMERCIAL SCALE WELLS
Toronto, ON – September 19, 2019. Denison Mines Cor p. (“Denison” or the “Company”) (DML: TSX,
DNN: NYSE American) is pleased to announce that the initial In-Situ Recovery (“ISR”) field test results from
Test Area 2 of the Phoenix deposit (“Phoenix”) have confirmed hydraulic connectivity within a signific ant
portion of the ore zone tested. The initial field t ests are part of the ongoing ISR field test program at the
Company's 90% owned Wheeler River Uranium Project ( "Wheeler River") in northern Saskatchewan,
Canada.
Following the positive initial test results from Test Area 1 (outlined in Denison's press release dated August
27, 2019) and Test Area 2 (summarized below), Denis on has decided to advance to the second stage of
ISR field testing – the installation of large-diameter commercial scale wells (“CSWs”) and the completion of
additional hydrogeological field testing. One CSW is planned for each of Test Area 1 and Test Area 2, with
each well designed to meet the technical and regula tory standards expected for a commercial ISR well a t
Phoenix. Accordingly, each well’s completion will provide key inputs for the Environmental Impact
Assessment ("EIA") process and planned Feasibility Study (“FS”) and will ultimately reduce the risk
associated with the application of the ISR mining method at Phoenix.
David Cates, President and CEO of Denison, commente d, “The initial test results from Test Area 1 and
Test Area 2 have provided the confidence and information needed to initiate the installation of commercial
scale wells and additional testing, as we de-risk t he project in a staged, disciplined, and cost effec tive
manner. It is exciting to progress to the next phase of the summer 2019 program and witness the installation
of the first large-diameter wells, designed for com mercial ISR production, in the Athabasca Basin. We are
looking forward to initiating further hydrogeologic al testing from these wells, which should allow for the
simulation of fluid flow within the deposit under conditions similar to a commercial production environment.”
Initial Test Results from Test Area 2
As part of the ISR field test program, two Pump/Inj ection (“P/I”) wells and four Observation wells wer e
successfully installed within Test Area 2 at Phoenix Zone A, as shown in Figures 1 and 2 and summarized
in the table below. One of the Observation wells is fitted with a Vibrating Wire Piezometer (“VWP”) equipped
with pressure transducers at various depth locations. The well installations for Test Area 2 were completed
using the same methodologies and specifications use d for Test Area 1 (as outlined in Denison’s press
release dated June 26, 2019, see ‘Well Installations’ ).
Location Test Well Type Test Formation
Test Area 2
GWR-018 Observation Adjacent Sandstone
GWR-019 Pump/Injection Ore Zone
GWR-021 Observation Multiple (VWP)
GWR-022 Pump/Injection Ore Zone
GWR-023 Observation Ore Zone
GWR-026 Observation Ore Zone
Initial pump and injection tests were completed by Petrotek Corporation (“Petrotek”) by pumping water from,
or injecting water into, the P/I wells installed wi thin Test Area 2. In tests completed within P/I wel l GWR-
019, a hydraulic response has been observed at two of three Observation wells located within the ore zone
(GWR-023 and GWR-026). No response was observed in P/I well GWR-022 or Observation well GWR-021
(Ore Zone - VWP), which are also located within the ore zone. In tests completed within P/I well GWR-022,
no hydraulic responses were observed at the two Obs ervation wells within the ore zone (GWR-023 and
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GWR-026), the other P/I well (GWR-019) or Observation well GWR-021 (Ore Zone – VWP). These results
are consistent with the hydraulic tests conducted w ithin P/I well GWR-019 and the geologic observation s
of drill core recovered from GWR-022 (as described below).
Taken together, hydraulic responses have been obser ved within a significant portion of the ore zone
contained within Test Area 2 – with hydraulic connectivity observed over an approximate strike length of 15
metres (of a possible 30 metres) and across-strike length of 16 metres (of a possible 16 metres) –
representing the maximum across-strike length respo nse possible in Test Area 2, given the design of th e
field test (see Figure 2).
Additionally, no hydraulic responses were observed in the adjacent sandstone Observation well (GWR-
018), located outside of the ore zone test formation (similar to GWR-017 in Test Area 1, see Denison Press
release dated August 27, 2019), or within the overlying sandstone and underlying basement VWPs installed
in GWR-021. The lack of response in the basement VW P of GWR-021 is further indicative of low
permeability conditions within the basement units below the Phoenix Zone A orebody. To date, no hydraulic
basement responses have been observed in either Test Area 1 or Test Area 2, which is generally supportive
of the Company’s expectation that the basement unit s below the Phoenix deposit will be able to provide
containment of the ISR mining solution in conjunction with the planned freeze dome.
At present, Test Area 2 is interpreted to be more g eologically complex than Test Area 1, relating to t he
variable structure and alteration. During initial pump and injection tests, where hydraulic responses were
observed within the ore zone test horizon (GWR-023, GWR-026 and GWR-019), the areas are geologically
characterized as variably high grade (~30% U 3O8 to 45% U 3O8) to very high grade (~60% U 3O8 to 82%
U3O8), semi-massive to massive uraninite with additiona l sections of strongly structured and friable ore.
Where hydraulic responses were not observed within the ore zone test horizon (GWR-022 and GWR-021
VWP), the areas are geologically characterized as more clay-rich, with sections of massive clays occurring
along fault zones with associated lower grades of uranium mineralization.
The initial results for Test Area 2 are consistent with expectations of fluid flow for that area of the deposit.
Importantly, testing in this geologically complex a rea, amongst other Test Areas, will allow for the
optimization of planned ISR mining under the variou s geological conditions expected within the Phoenix
deposit. As part of the Company’s plans for further testing in 2019 and beyond, permeability enhancement
techniques, various well spacings and patterns, and /or ‘sweep’ (injection-recovery between wells) versus
‘soak’ (injection-recovery within the same well) mining methodologies, will all be evaluated ahead of the
development of a comprehensive mine plan.
Commercial Scale Wells
Following the completion of initial ISR field tests in Test Area 1 and Test Area 2, Denison has commenced
the installation of a CSW in Test Area 1. An additional CSW is planned for Test Area 2 and is expected to
be initiated following the completion of additional hydrogeological testing from the CSW in progress in Test
Area 1. The initial positive ISR field test results obtained from lower-cost / smaller-diameter HQ and PQ
sized wells in Test Area 1 and Test Area 2, have pr ovided the confidence and information required to
commence with the installation of the higher-cost / larger-diameter CSWs.
The CSWs are designed as vertical wells for the injection or recovery of mining solution during commercial
ISR operation. The planned drilling process involve s conductor casing of the overburden (glacial till) ,
followed by destructive drilling through the Athaba sca sandstone and finally coring of the ore zone an d
approximately 10 metres of underlying basement rock s. Materials used in the installation of the wells are
expected to include an outer casing and inner lined casing – with the outer casing cemented in place –
providing a double-walled, fully-sealed piping system, which is mining solution ready and expected to meet
environmental and regulatory standards. A well screen will be installed within the ore zone which, together
with the insertion of larger diameter downhole pump s, will allow for the pumping/injection of water to
simulate fluid flow within the deposit under condit ions similar to those expected for commercial opera tion.
The installation of each CSW during the summer 2019 program is also expected to provide useful
information for the planned FS in regard to costs a nd schedule for the development of the proposed ISR
wellfield.
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A permeability enhancement technique has also been selected for initial evaluation during the summer
2019 program. The MaxPERF drilling tool, developed and operated by Penetrators Canada Inc., is
deployable from within the planned CSW and designed to drill a 0.7 inch (17 mm) roughly horizontal hol e
up to 72 inches (182 cm) in length. The objective i s to expose the permeability of the ore zone in mor e
challenging areas by completing multiple arrays of holes at various elevations, potentially providing
increased access to hydraulic connectivity associat ed with the existing fracture network. Hydrogeologi cal
testing is planned both before, and after, the application of the MaxPERF drilling tool. Downhole geophysics
are also planned for each CSW, including nuclear ma gnetic resonance and dual neutron, to provide
additional supportive permeability and porosity data, respectively.
Additional Supportive Permeability and Porosity Tests
Supportive permeability and porosity tests, including hydraulic conductivity tests (packer testing), geological
and geotechnical logging, and permeability (permeam eter) testing, have been completed for Test Area 1
and Test Area 2. This significant dataset will unde rgo data verification followed by detailed analysis ,
reporting, and integration into the hydrogeological model being developed for Phoenix. In addition,
numerous mineralized core samples from the ore zone , obtained from the summer 2019 field program,
have been preserved to facilitate future planned laboratory-based metallurgical test work.
About Wheeler River
Wheeler River is the largest undeveloped uranium pr oject in the infrastructure rich eastern portion of the
Athabasca Basin region, in northern Saskatchewan – including combined Indicated Mineral Resources of
132.1 million pounds U 3O8 (1,809,000 tonnes at an average grade of 3.3% U 3O8), plus combined Inferred
Mineral Resources of 3.0 million pounds U 3O8 (82,000 tonnes at an average grade of 1.7% U 3O8). The
project is host to the high-grade Phoenix and Gryph on uranium deposits, discovered by Denison in 2008
and 2014, respectively, and is a joint venture betw een 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 U 3O8 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%, an d initial pre-production capital expenditures of $3 22.5
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 p re-production capital expenditures of $322.5 millio n, and
industry leading average operating costs of US$3.33 /lb U 3O8. The PFS is prepared on a project (100%
ownership) and pre-tax basis, as each of the partne rs to the Wheeler River Joint Venture are subject t o
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 int erest, are described in greater detail in the NI 43 -101
Technical Report titled "Pre-feasibility Study for the Wheeler River Uranium Project, Saskatchewan,
Canada" dated October 30, 2018 with an effective da te of September 24, 2018. A copy of this report is
available on Denison's website and under its profil e on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov/edgar.shtml.
About Denison
Denison is a uranium exploration and development company with interests focused in the Athabasca Basin
region of northern Saskatchewan, Canada. In additio n to the Wheeler River project, Denison’s Athabasca
Basin exploration portfolio consists of numerous pr ojects covering approximately 305,000 hectares.
Denison’s interests in the Athabasca Basin 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, which
is currently processing ore from the Cigar Lake mine under a toll milling agreement, plus a 25.17% interest
in the Midwest and Midwest A deposits, and a 66.51% interest in the J Zone and Huskie deposits on the
Waterbury Lake property. Each of Midwest, Midwest A, J Zone and Huskie are located within 20 kilometres
of the McClean Lake mill.
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Denison is also engaged in mine decommissioning and environmental services through its Denison
Environmental Services division and is the manager of Uranium Participation Corp., a publicly traded
company which invests in uranium oxide and uranium hexafluoride.
For more information, please contact
David Cates (416) 979-1991 ext 362
President and Chief Executive Officer
Sophia Shane (604) 689-7842
Investor Relations
Follow Denison on Twitter @DenisonMinesCo
Qualified Persons
The hydrogeological results and interpretations thereof contained in this release were prepared by Mr. Errol
Lawrence, PG (Senior Hydrogeologist), and Mr. Aaron Payne, PG (Senior Hydrogeologist) at Petrotek,
independent Qualified Persons in accordance with the requirements of NI 43-101.
The other technical information contained in this r elease has been reviewed and approved by Mr. Dale
Verran, MSc, P.Geo, Pr.Sci.Nat., Denison's Vice President, Exploration, 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 terminolog y 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 r esults ‘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 field test program (including drilling)
and evaluation interpretations, activities, plans a nd objectives; the results of the PFS and expectati ons with respect thereto;
development and expansion plans and objectives, including plans for a feasibility study and environmental assessments for Wheeler
River; 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, uncert ainties and other factors that may cause the actual results, level of activity,
performance or achievements of Denison to be materi ally different from those expressed or implied by s uch forward-looking
statements. 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 a ccurate and results may differ materially from thos e 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 12, 2019 under the heading ‘Risk Factors’. These factors
are not, and should not be construed as being exhaustive.
Accordingly, readers should not place undue relianc e on forward-looking statements. The forward-lookin g 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 t his news release to conform such information to act ual results or to changes in
Denison's expectations except as otherwise required by applicable legislation.
Cautionary Note to United States Investors Concerni ng Estimates of Measured, Indicated and Inferred Mi neral Resources
and Probable Mineral Reserves: This news release may use the terms 'measured', 'i ndicated' 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, Metal lurgy and Petroleum referred to in Canadian Nationa l Instrument 43-101 Mineral
Disclosure Standards ("NI 43-101") and are recogniz ed and required by Canadian regulations, the United States Securities and
Exchange Commission ("SEC") does not recognize them. '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 Canadi an rules, estimates of inferred mineral resources m ay 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 mine able. The estimates of
mineral reserves in this news release have been prepared in accordance with NI 43-101. The definition of probable mineral reserves
used in NI 43-101 differs from the definition used by the SEC in the SEC's Industry Guide 7. Under th e requirements of the SEC,
mineralization may not be classified as a "reserve" unless the determination has been made, pursuant to a "final" feasibility study that
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the mineralization could be economically and legall y produced or extracted at the time the reserve det ermination is made. Denison
has not prepared a feasibility study for the purpos es of NI 43-101 or the requirements of the SEC. Ac cordingly, Denison's probable
mineral reserves disclosure may not be comparable t o information from U.S. companies subject to the re porting and disclosure
requirements of the SEC.
Figure 1. Phoenix Zone A plan view showing Test Areas delineated for ISR field testing.
Figure 2. Plan map and long section showing Pump/Injection and Observation wells
completed for ISR field testing in Test Area 2.