Denison Reports Results from 2017 and Outlook FOR 2018
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Denison Mines Corp.
1100 – 40 University Ave
Toronto, ON M5J 1T1
www.denisonmines.com
PRESS RELEASE
DENISON REPORTS RESULTS FROM 2017 AND OUTLOOK FOR 2018
Toronto, ON – March 8, 2018. Denison Mines Corp. (“Denison” or the “Company”) (DML: TSX, DNN: NYSE MKT)
today filed its Consolidated Financia l Statements and Management’s Discussion & Analysis (“MD&A”) for the year
ended December 31, 2017. Both documents can be found on the Company’s website at www.denisonmines.com or
on SEDAR (at www.sedar.com) and EDGAR (at www.sec.gov/edgar.shtml). The highlights provided below are derived
from these documents and should be read in conjunction with them. All amounts in this release are in U.S. dollars
unless otherwise stated.
David Cates, President and CEO of Denison commented, "2017 was a volatile year for the uranium market. While the
spot price of uranium benefit ed from upward momentum on multiple occa sions during the year, that momentum was
not sustained long enough for a meaningful change to the low price environment that saw the market reach 12 and 13
year lows in late 2016. Despite these disappointing market trends, Denison managed to have another productive year
as we continue to focus on our strategy of positioning the Company for the future and a return to a much higher uranium
price. Much of the work completed by our team in 2017 was in preparation for an updated resource estimate for the
Wheeler River project, which we announced in early 2018, and associated advancements ahead of the planned
completion of a PFS in 2018. With an 88% increase in our estimated indicated mineral resources at Wheeler River,
we feel confident that the project has the ability to become the next produci ng uranium mine in the Athabasca Basin
region. We also strengthened our balan ce sheet in early 2017, raising CAD$63.5M in gross proceeds, with minimal
dilution to our shareholders, providing us with the financial flexibility to advance Wheeler River.
2018 is poised to be a very interesting year for Denison and the uranium market. Our project development team has
its sights set on delivering a positive PFS for Wheeler River, while our exploration team has changed its focus, from
the last two years of delineation drill ing at Wheeler River, to once again conc entrate on the considerable discovery
potential at Wheeler River and our high-priority pipeline projects. From an industry perspective, we will be watching to
see how the market digests (a) the significance of Cameco’s shut-down of the world’s largest and highest grade uranium
mining operation (the McArthur River mi ne), and (b) the potential for an extended shutdown of McArthur River in the
absence of a significant increase in the long term uranium price.”
PERFORMANCE HIGHLIGHTS
Completed a highly successful 2017 exploration and definition drilling program at Wheeler River
During 2017, Denison completed a total of 43,956 metres of drilling in 90 holes at Wheeler River, with work focused
at or near the Gryphon deposit, during the summer and the winter drilling programs. To reduce drilling meterage, 77
of the 90 holes were completed as subs urface ‘daughter’ holes, which were drilled as off-cuts from surface ‘parent’
holes, and a directional drilling method was employed to en sure drilling accuracy. Highlights from the 2017 drilling
program included:
Expansion of mineralization ahead of the updated Gryphon deposit mineral resource estimate
During 2017, Gryphon mineralization was expanded in numerous areas by infill and step-out drilling on an
approximate 25 x 25 meter spacing, including: 1) expansion of high-grade mineralization within the D series lenses;
2) discovery and expansion of the E series lenses bot h at the unconformity and within the upper basement; and 3)
expansion of the A and B series lenses both up-dip and down dip.
Completion of the definition drilling program at the Gryphon Deposit
In the fourth quarter of 2017, the Company successfully completed the definition drilling program on the Gryphon
deposit’s A, B and C series mineralized lenses, with the objective of increas ing the confidence of the previously
estimated mineral resources from an inferred to indicated level. The definition drilling program, which commenced in
the summer of 2016, included a total of 42 infill and delineation drill holes to complete an approximate 25 x 25 metre
drill spacing.
Completed an updated mineral resource estimate for Wheeler River’s Gryphon Deposit
On January 31, 2018, Denison announced an updated mineral resource estimate for the Gryphon deposit, which
included, above a cut-off grade of 0.2% U 3O8, 61.9 million pounds of U 3O8 (1,643,000 tonnes at 1.71% U 3O8) in
Indicated Mineral Resources, plus 1.9 million pounds of U 3O8 (73,000 tonnes at 1.18% U 3O8) in Inferred Mineral
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Resources. With this update to the resources estimat ed for the Gryphon deposit, the combined Indicated Mineral
Resources estimated for the Wheeler River proj ect increased by 88% to 132.1 million pounds U 3O8, which will be
used to support the Pre-Feasibility Study (‘PFS’), initiated for the project in July 2016, and expected to be completed
during 2018. Following the update, Wheeler River retain ed and improved its standing as the largest undeveloped
high-grade uranium project in the infrastructure rich eastern portion of the Athabasca Basin.
Discovered the high-grade, basement-hosted, Huskie Zone on the Waterbury Lake property
During the summer 2017 drilling program at Waterbury Lake, Denison discovered high-grade, basement-hosted
mineralization located approximately 1.5 kilometres to t he northeast of the property’s J Zone uranium deposit. The
summer program included nine drill holes totaling 3,722 metres. Of the eight drill holes designed to test for basement-
hosted mineralization, seven holes intersected significant mineralization, including 9.1% U3O8 over 3.7 metres (drill
hole WAT17-446A), 1.7% U 3O8 over 7.5 metres (drill hole WAT17-449) and 1.5% U 3O8 over 4.5 metres (drill hole
WAT17-450A). The Huskie zone has been defined over a strike length of 100 metres (the extent of the 2017 drilling)
and remains open in all directions.
Increased Ownership of Wheeler River Project to 63.3%
In January 2017, the Company executed an agreement with the partners of the Wheeler River Joint Venture (‘WRJV’)
that will result in an increase in Denison's ownership of the Wheeler River project by up to approximately 66% by the
end of 2018. Under this agreement, Denison is funding 50% of Cameco Corp.’s (‘Cameco’) ordinary share (30%) of
joint venture expenses in 2017 and 2018. On January 31, 2018, Denison announced it had increased its interest in
the Wheeler River project, based on spending on the projec t during 2017, from 60% to 63.3% in accordance with
this agreement.
Closed non-dilutive financing for CAD$43.5 million to fund future project development activities
In the first quarter of 2017, Denison announced and closed a financing arrangement for gross proceeds of CAD$43.5
million, which has the effect of monetizing Denison’s future share of the toll milling revenue earned by the McClean
Lake mill from the processing of ore fr om the Cigar Lake mine through the comb ination of a limited recourse loan
and a streaming arrangement. Through this transaction, Deni son retains its 22.5% ownership of the McClean Lake
Joint Venture (‘MLJV’), but has de-risked its income from certain toll milling revenue, as the Company is not providing
any warranty to the future rate of production at the Cigar Lake mine or the McClean Lake mill. The proceeds from
the financing are expected to fund the Company’s project development costs for Wheeler River towards the
completion of a Feasibility Study and ultimately project financing.
Obtained financing for the Company’s 2018 Canadian exploration activities
In March 2017, the Company completed a private placement of 18,337,000 common shares for gross proceeds of
$14,806,000 (CAD$20,200,290). The financing included (1) a ‘Common Share’ offering of 5,790,000 common shares
of Denison at a price of CAD$0.95 per share for gross proceeds of CAD$5,500,500; (2) a ‘Tranche A Flow Through’
offering of 8,482,000 flow through shares at a price of CAD$1.12 per share for gross proceeds of $9,499,840; and
(3) A ‘Tranche B Flow Through’ offering of 4,065,000 flow through shares at a price of CAD$1.23 per share for gross
proceeds of CAD$4,999,950. The proceeds from the flow through tranc hes of the financing will be used to fund
Canadian exploration activities through to the end of 2018.
Denison Environmental Services (‘DES’) renewed its cornerstone environmental services contract
In July 2017, DES entered into a new two-year services agreement with Rio Algom Limited, a subsidiary of BHP
Billiton Limited for the management and operation of nine decommissioned mine sites in Ontario and Quebec.
ABOUT DENISON
Denison is a uranium exploration and development company wi th interests focused in the Athabasca Basin region of
northern Saskatchewan, Canada. In addition to its 60% owned Wheeler River project, which hosts the high grade
Phoenix and Gryphon uranium deposits, Denison's explorat ion portfolio consists of numerous projects covering
approximately 351,000 hectares in the Athabasca Basin region . Denison's interests in Saskatchewan 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 deposit and a 64.22 % interest in the J Zone deposit on the Waterbury Lake
property. Both the Midwest and J Zone deposits are located within 20 kilometres of the McClean Lake mill.
Denison is engaged in mine decommissioning and environmental services through its Denison Environmental Services
(DES) division, which manages Denison’s Elliot Lake re clamation projects and prov ides post-closure mine and
maintenance services to a variety of industry and government clients.
Denison is also the manager of Uranium Participation Corporation (UPC), a publicly traded company listed on the TSX
under the symbol “U”, which invests in uranium oxide in concentrates (U3O8) and uranium hexafluoride (UF6).
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SELECTED ANNUAL FINANCIAL INFORMATION
(in thousands, except for per share amounts)
Year Ended
December 31,
2017
Year Ended
December 31,
2016
Results from Continuing Operations:
Total revenues $ 11,085 $ 13,833
Exploration and evaluation $ (12,834) $ (11,196)
Impairment of property, plant & equipment $ 246 $ (2,320)
Net loss $ (14,087) $ (11,699)
Basic and diluted loss per share $ (0.03) $ (0.02)
Results from Discontinued Operations:
Net loss $ (81) $ (5,644)
Basic and diluted loss per share $ 0.0 $ (0.01)
(in thousands)
As at
December 31,
2017
As at
December 31,
2016
Financial Position:
Cash and cash equivalents $ 2,898 $ 11,838
Investments in debt instruments (GICs) $ 30,136 $ -
Cash, cash equivalents and GIC’s $ 33,034 $ 11,838
Working capital $ 29,140 $ 9,853
Property, plant and equipment $ 198,480 $ 187,982
Total assets $ 260,068 $ 217,423
Total long-term liabilities $ 65,121 $ 37,452
RESULTS OF CONTINUING OPERATIONS
Revenues
On February 13, 2017, Denison closed an arrangement wi th Anglo Pacific Group PLC and one of its wholly owned
subsidiaries (the ‘APG Transaction’) under which Denison received an upfront payment of $32,860,000
(CAD$43,500,000) in exchange for its right to receive future toll milling cash receipts from the MLJV under the current
toll milling agreement with the Cigar Lake Joint Venture (‘ CLJV’) from July 1, 2016 onwards. The APG Transaction
represents a contractual obligation of Denison to forward to APG any cash proceeds of toll milling revenue earned by
the Company after July 1, 2016 related to the processing of the specified Cigar Lake ore through the McClean Lake
mill, and as such, the upfront payment has been accounted for as deferred revenue.
During 2017, the McClean Lake mill continued to process ore received fr om the Cigar Lake mine and packaged
approximately 18.0 million pounds U3O8 from the mine. In 2017, the Company re cognized total toll milling revenue of
$2,558,000. The Company’s share of toll milling revenue for January 2017 of $444,000, prior to the closing of the APG
Transaction, was recognized as toll milling revenue in the first quarter of 2017. Following the closing of the APG
Transaction, CAD$4,770,000 in toll milling cash receipts were received from the MLJV, and the Company recognized
toll milling revenue from the draw-down of deferred revenue of $2,114,000.
Revenue from DES division was $7,130,000 and revenue from the Company’s management contract with UPC was
$1,397,000 during 2017.
Operating expenses
Operating expenses in the Canadian mining segment in clude depreciation, mining and other development costs, as
well as adjustments to the estimates of future reclamati on costs in relation to the companies mining properties.
Operating expenses during 2017 were $4,088,000, includi ng $2,989,000 of depreciation from the McClean Lake mill,
associated with the processing of U3O8 for the CLJV.
Operating expenses at DES during 2017 totaled $6,357,000 and relate primarily to care and maintenance, and
environmental consulting services provided to clients, and includes labour and other costs.
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Exploration and evaluation
During 2017, the Company continued to focus on its significa nt portfolio of projects in the eastern portion of the
Athabasca Basin region in Saskatchewan. Denison’s share of exploration and evaluation expenditures in 2017 was
$12,834,000. The Company’s Athabasca land package increased during the fourth quarter from 346,761 hectares (244
claims) to 351,365 hectares (267 claims) owing to selective staking contiguous with, or proximal to, Denison’s existing
claims.
Wheeler River
Project Highlights:
Largest undeveloped high-grade uranium project in the eastern Athabasca
On January 31, 2018 Denison announced an updated mineral resource estimate for the Gryphon deposit following
drilling results from a further 144 drill holes completed during 2016 and 2017. The updated mineral resource estimate
for Gryphon, above a cut-off grade of 0.2% U3O8, includes 61.9 million pounds of U3O8 (1,643,000 tonnes at 1.71%
U3O8) in Indicated Mineral Resource s, and 1.9 million pounds of U 3O8 (73,000 tonnes at 1.18% U 3O8) in Inferred
Mineral Resources.
The Phoenix deposit, located approximately three kilometres southeast of Gryphon, is estimated to include Indicated
Mineral Resources of 70.2 million pounds of U 3O8 above a cut-off grade of 0.8% U 3O8 (166,000 tonnes at 19.1%
U3O8).
With the update to the Gryphon deposit resource estimate, the combined Indicated Mineral Resources estimated for
Wheeler River have increased by 88% to 132.1 million pounds U3O8, which will be used to support the PFS.
With the updated mineral resource estimate for the proper ty’s Gryphon deposit, the Wheeler River project retains
and improves its position as the lar gest undeveloped high-grade uranium project in the eastern portion of the
Athabasca Basin region, in northern Saskatchewan.
Proximal to existing uranium mining and milling infrastructure
The property is located in the infrastructure rich eastern portion of the Athabasca Basin, which is host to existing
uranium mining and milling infrastructure, including the 22.5% Denison owned McClean Lake mill. The Wheeler River
property lies alongside provincial highway 914 and a provincial powerline.
Positive preliminary project economics
On April 4, 2016, Denison announced t he results of its PEA for the Wheeler River Project, which considers the
potential economic merit of co-develop ing the high-grade Gryphon and Phoenix deposits as a single underground
mining operation. The PEA was based on the resources estimated at the Gryphon deposit in November 2015, and
returned a base case pre-tax Internal Rate of Return (‘IRR’) of 20.4% based on the then current long term contract
price of uranium ($44.00 per pound U3O8). Denison's share of initial capital expenditures (‘CAPEX’) in the PEA was
estimated to be CAD$336M (CAD$560M on 100% ownershi p basis) based on its 60% owne rship interest at that
time. The PEA is preliminary in nature, was based on Inferred Mineral Resources that are considered at the time to
be too speculative geologically to have the economic considerations applied to them to allow them to be categorized
as mineral reserves, and there is no certainty that the results from the PEA will be realized. The results of the updated
estimate of Indicated Mineral Resources for the project of 132.1 million pounds U3O8, have not been included in the
PEA, but will be used to support the PFS.
Increasing Denison ownership
As previously announced on January 10, 2017, Denison ent ered into an agreement with its Wheeler River Joint
Venture partners, Cameco and JCU (Can ada) Exploration Company, Limited (‘JCU’), to fund 75% of Joint Venture
expenses in 2017 and 2018 (ordinarily 60%) in exchange for an increase in Denison's interest in the project up to
approximately 66%. Under the terms of the agreement, Cameco is funding 50% of its ordinary 30% share in 2017
and 2018, and JCU continues to fund bas ed on its 10% interest in the pr oject. On January 31, 2018, Denison
announced it had increased its interest in the Wheeler River project during 2017 from 60% to 63.3% in accordance
with this agreement.
Significant potential for resource growth
The Gryphon deposit is a growing, high-grade uranium d eposit that belongs to a sele ct group of large basement-
hosted uranium deposits in the eastern Athabasca Basin. The Gryphon depos it remains open in numerous areas
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with significant potential for future resource growth. Priority target areas include: (1) Along strike to the northeast of
the E series lenses, where both unconformity and basement potential exists; (2) Down plunge of the A and B series
lenses; (3) Along strike to the northeast and southwest of the D series lenses; and (4) Within the currently defined D
series lenses, where additional high-grade shoots may exist.
In addition, very little regional exploration has taken place on the property in recent years, with drilling efforts focussed
on Phoenix and Gryphon, which were discovered in 2008 and 2014 respectively. The property is host to numerous
uranium-bearing lithostructural corridors, which are under- or unexplored and have the potential for additional large,
high-grade unconformity or basement hosted deposits. Ex ploration drilling is warranted along these corridors to
follow-up on previous mineralized drill results, or to test geophysical targets identified from past surveys.
Exploration Program:
Denison’s share of exploration costs at Wheeler River amounted to $7,24 0,000 during the winter and summer 2017
diamond drilling programs for a total of 43,956 metres in 90 drill holes (refer Denison’s press releases dated May 26,
2017 and November 27, 2017).
Highlight results for the 2017 drilling program include:
Continued expansion of high-grade within the D series lenses;
Discovery and extension of the E series lenses;
Continued expansion of the A and B series lenses; and
Completion of the definition drilling program.
Evaluation Program:
During 2017, Denison’s share of evaluation costs at Wheeler River amounted to $1,737,000, which related to work on
a PFS and environmental activities.
PFS Activities highlights include:
Engineering activities
o Ongoing engineering data collections;
o Further metallurgical test program;
o Assessment of Phoenix alternate mining methods; and
o Other engineering activities.
Sustainability Activities
o Community consultation and engagement process; and
o Completed the collection of a full year of environmental baseline data.
Exploration Pipeline Properties
During 2017, the Company managed or participated in fi ve other exploration drillin g programs (three operated by
Denison) on the Company’s pipeline properties.
At Waterbury Lake (Denison 64.22% in terest and operator), Denison disco vered high-grade, basement-hosted
mineralization, located approximately 1. 5 kilometres to the northeast of th e property’s J Zone uranium deposit. The
new zone of mineralization has been named the ‘Huskie’ zone. The mineralized zone occurs between 50 and 175
metres vertically below the sub-Athabasca unconformity (265 and 390 metres vertically below surface) and measures
approximately 100 metres along strike (the extent of the 2017 drilling), up to 120 metres along dip, with individual lenses
varying in interpreted true thickness between approximately 2 and 7 metres. The zone is wide-open in all directions in
terms of the mineralization and associated alteration inters ected. Assay results for the summer 2017 drilling program
were reported in Denison’s press release dated October 11, 2017.
General and administrative expenses
Total general and administrative expenses were $5,858,000 during 2017. These costs are mainly comprised of head
office salaries and benefits, office costs in multiple regi ons, audit and regulatory costs, legal fees, investor relations
expenses, project costs, and all other costs related to operating a public company with listings in Canada and the United
States, as well as non-recurring project costs associated with the APG transaction.
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Other income and expenses
During 2017, the Company recognized a gain of $2,210,0 00 in other income. The gain is predominantly due to net
gains on investments carried at fair value of $1,891,000, as well as a gain of $679,000 recorded in the first quarter of
2017 related to the extinguishment of the toll milling contract liability related to the Cigar Lake toll milling arrangement,
offset by letter of credit fees of $317,000.
Equity share of income from associates
During 2017, the Company recognized a loss of $489,000 from its equity share of its asso ciate GoviEx Uranium Inc.
(‘GoviEx’). The loss in 2017 is predominantly due to an eq uity loss of $751,000, whic h is based on the Company’s
share of GoviEx’s net loss during the period. In addition, du ring 2017, the Company recorded a net dilution gain of
$262,000, as a result of equity issuances completed by GoviEx as well as other shareholders’ exercise of GoviEx share
warrants, which reduced the Company’s ownership posit ion in GoviEx from 20.68% at December 31, 2016 to
approximately 18.72% at December 31, 2017.
Results of discontinued operations
In November 2015, Denison completed the sale of its interest in the Gurvan Saihan Joint Venture (‘GSJV’) to Uranium
Industry a.s. (‘Uranium Industry’), of the Czech Republic, as more particularly described in Denison’s press release
dated December 1, 2015. In connection therewith, Denison received $1.25 million in initial payments during 2015, and
the right to receive additional contingent consideration of (a) $10,000,000, paya ble within 60 days of the issuance of
certain mining licenses (the ‘Mining License Receivable’) , and (b) up to an additional $2,000,000 within 365 days
following the attainment of certain production targets on the mining licenses (the ‘Production Threshold Consideration’).
In September 2016, the mining license certif icates for all four projects were forma lly issued. As a result, in the third
quarter of 2016, the Company recognized the $10,000,000 fair value of the Mining License Receivable and it also
recognized a corresponding gain on sale, net of additional applicable transaction costs. The original due date for
payment of the Mining License Receivable by Uranium Industry was in November 2016.
Pursuant to a subsequent extension agreement between Uranium Industry a nd the Company, the payment due date
of the Mining License Receivable was extended from November 16, 2016 to July 16, 2017 (‘Extension Agreement’). As
consideration for the extension, Uranium Industry agreed to pay interest on the Mining License Receivable amount at
a rate of 5% per year, payable monthly up to July 16, 2017 and they also agreed to pay a $100,000 instalment amount
towards the balance of the Mining License Receivable amount. The first payment under the Extension Agreement was
due on or before January 31, 2017, but the required payments were not made by Uranium Industry.
On February 24, 2017, the Company served notice to Uranium Industry that it was in defaul t of its obligations under
the GSJV Agreement and the Extension Agreement and that the Mining License Receivable and all interest payable
thereon are immediately due and payable. The Company intends to pursue all proceedings available to it to collect the
Mining License Receivable amount, and on December 12, 2017, the Company filed a Request for Arbitration under the
Arbitration Rules of the London Court of International Arbitration in relation to the default of Uranium Industry’s
obligations under the GSJV Agreement and Extension Agreement. Uranium Industry submitted its response to
Denison’s Request for Arbitration and a counterclaim on F ebruary 14, 2018. The parties are currently working to
appoint a chair of the arbitration panel.
In light of the uncertainty regarding collectability, at December 21, 2016, Denison impaired the $10,000,000 Mining
License Receivable to $nil. The Production Threshold Consi deration is fair valued at $nil and will be re-measured at
each subsequent reporting date.
Liquidity and capital resources
Cash and cash equivalents were $2, 898,000 at December 31, 2017 and the company also held investments in
Guaranteed Investment Certificates (‘GICs’) of $30,136,000, which are categorized as short term investments on the
balance sheet.
The Company holds the large majority of its cash, cash equivalents, and investments in Canadian dollars. As at
December 31, 2017, the Company’s cash and cash equivalents and GICs amount to approximately CAD$41.4 million.
In January, 2018, the Company’s CAD$24 million credit facility was amended and extended to January 31, 2019. The
credit facility is fully utilized for non-financial letters of cr edit in relation to future decommissioning and reclamation
plans.
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Outlook for 2018
Denison’s plans for 2018 are a continuation of its strategy focused on the activities necessary to position it as the next
uranium producer in Canada. Accordingly, the 2018 budge t is heavily concentrated on evaluation and exploration
activities designed to strategically advance the Company’s 63.3% owned flagship Wheeler River project.
(CAD ‘000) 2018 BUDGET
Canada (1)
Development & Operations (5,230)
Mineral Property Exploration & Evaluation (16,760)
(21,990)
Other (1)
UPC Management Services 1,230
DES Environmental Services 1,330
Corporate Administration & Other (4,760)
(2,200)
Total(2) $ (24,190)
Notes:
1. Budget figures are expressed in Canadian dol lars as the Company’s presentation currency
changed to the Canadian dollar effective January 1, 2018.
2. Only material operations shown.
Development & Operations
In 2018, Denison’s share of operating and capital expend itures at McClean Lake and Midwest are budgeted to be
CAD$4.3 million. Operating expenditures at McClean incl ude CAD$3,965,000 in respect of Denison’s share of the
planned 2018 budget for the advancement of the SABRE mining method.
2018 operating expenditures are also expected to include CAD$751,000 for reclamation ex penditures at Denison’s
legacy Elliot Lake mine site.
Mineral Property Exploration & Evaluation
Including partner’s share of expenses, the projected 2018 exploration and evaluation work program is budgeted to be
CAD$21.8 million, and is expected to include approximately 80,000 metres of drilling across six of Denison’s projects.
The budget will be mainly focused on the Company’s high priority projects, namely Wheeler River, Waterbury Lake and
Hook-Carter. Consistent with past years, the majority of the exploration activity will occur during the winter and summer
months, resulting in higher levels of expenditures in the first and third quarters of 2018. Evaluation activities are
expected to continue at the Wheeler River project throughout the year.
Wheeler River
A CAD$13.1 million budget (100% basis) has been approved for the Wheeler River project. The budget includes
exploration expenditures of CAD$9.5 million and evaluation expenditures of CAD$3.6 million.
Denison’s share of the budget is expe cted to be CAD$9.8 million, which repres ents 75% of joint venture expenses.
(see Denison’s press release dated January 10, 2017).
The 2018 exploration program is expected to include approximately 45,000 metres of diamond drilling in 60 drill holes
and will be results oriented with an initial focus on step-out drilling along strike of the Gryphon deposit and drill testing
of high-priority and largely untested regional targets on the property. Refer Denison news release on January 17, 2018
for details on the 2018 exploration and evaluation pan.
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Exploration Pipeline Properties
Work on pipeline properties will be focused on 3 main Denison-operated properties:
Waterbury Lake Project
The Huskie Zone was discovered during the Company’s summer 2017 drilling program at Waterbury Lake. The 2018
exploration program is budgeted at CA D$3.5 million (100% Denison funded with KWULP continuing to dilute) and is
designed with the potential to expand the Huskie zone miner alization through step-out drilling. A diamond drilling
program of approximately 14,400 metres in 36 drill holes is planned for 2018 and is expected to be carried out during
the winter and summer drilling seasons.
Hook-Carter Project
The Hook-Carter property consists of 45 claims covering 20 ,522 hectares and is located in the western portion of the
Athabasca Basin. A diamond drilling program is planned fo r the winter of 2018, consis ting of approximately 10,000
metres in 17 drill holes, with a budget of CAD$2.2 million (100% Denison funded due to ALX’s carried interest).
South Dufferin
The South Dufferin project is 100% Denison owned and located just off the southern margin of the Athabasca Basin of
northern Saskatchewan. Priority drill targets have been developed across the property from recent ground geochemical
and geophysical surveying. A diamond drilling program is planned for summer 2018 comprising approximately 2,200
metres of drilling in 16 holes with a total budget of approximately CAD$1.0 million.
UPC management services and DES
Net management fees expected for 2018 from the management services agreement with UPC are budgeted at CAD$1.2
million. A portion of the management fees earned from UPC are based on UPC’s net asset value, and thus the uranium
spot price. Denison’s budget for 2018 assumes a uranium spot price of $20.00 per pound U3O8. Each $2 per pound U3O8
increase is expected to translate into approximately CAD$0.2 million in additional management fees to Denison.
Revenue from operations at DES during 2018 is budgeted to be CAD$9.6 million, and operating, overhead, and capital
expenditures are budgeted to be CAD$8.3 million.
Corporate admin and Other Income
Corporate administration expenses are budgeted to be CAD$4.7 million in 2018 and include head office salaries and
benefits, office costs, audit and regulatory costs, legal fees, investor relations expenses and all other costs related to
operating a public company with listings in Canada and the United States.
Letter of credit and standby fees relating to the 2018 Credit Facility are expected to be approximately CAD$400,000, which
is expected to be largely offset by interest income on the Company’s short-term investments.
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