Can you discuss the major developments at Denison Mines since we last spoke in 2020?

Between 2022 and 2023 we completed technical de-risking for the Phoenix In-Situ Recovery (ISR) project, including a variety of laboratory and field tests, concluding with a pilot operation that was permitted, constructed, commissioned, and operated during 2022.

We recovered the first uranium mined by ISR mining in Canada’s history during fall 2022. The information was used in the feasibility study, completed in June 2023, and validated ISR mining at Phoenix and potentially other sites in Saskatchewan’s Athabasca Basin region. This work was performed by a third-party qualified engineering firm, providing independent validation of our efforts over the past 4–5-year de-risking process. We pivoted to engineering design efforts, focusing on readying for project execution and early procurement.

We successfully completed a US$55 million financing in October 2023. The primary use of proceeds will be procuring long lead items for the Phoenix project throughout 2024. Can you discuss highlights from Wheeler River and the promise of the project?

Wheeler River is comprised of Phoenix and the Gryphon deposit, which is a complimentary underground operation. The 2023 Phoenix Feasibility Study (FS) reflects several design changes from the PFS completed in 2018. In the current cost environment, those design changes allowed us to deliver a positive change in NPV when others are generally showing reduced economics due to higher costs.

Our technical analysis is robust, generally modeling our production profile by individual well pattern, which gives us a comprehensive view of the overall project’s production profile. What are your relationships with First Nation communities?

In Saskatchewan we are a leader in terms of our agreements with Indigenous groups. While the shared prosperity agreement with English River First Nation is our most notable, we have a series of exploration agreements that have been in place for several years, which create a foundation of trust with various groups in relation to project development on all our properties. As outlined in our Indigenous People’s Policy, we acknowledge that the places we work are ancestral and/or traditional lands. Operating in a territory impacts traditional land use and Indigenous rights, which may not be visible to investors, but is significant. It is in our best interest to operate in a respectful way in this area.

We listen. We adapt our agreements to different groups. The first part of reconciliation is understanding, educating and listening. The discussion starts with the main interest of each group, rather than our interests. We ensure we are not dictating arrangements but listening and collaborating. Can you comment on the current macroclimate impacting uranium prices?

Uranium is generally a long-term contract business, which makes for long cycles. Production curtailments led to the drawdown of inventories in past years, setting the stage for the price to increase. The recent coup in Niger and the war in Ukraine destabilized the current and future reliance on supplies from Russia and countries where there is a perceived geopolitical risk. Kazakhstan is the largest supplier of uranium in the world, but it is stuck both physically and politically between China and Russia—both have significant needs and will procure much of their uranium from there. As a result, there was significant contracting interest from potential projects in Niger. The recent coup undoubtedly drove the Western market to focus even more on North American sources of supply. Incentivizing production from the USA has been challenging, given the small scale and high costs of idled projects; this makes the potential for low-cost and large-scale production from Canada very attractive to utility fuel buyers. As geopolitical instability persists, there is great potential for Canadian supply to be seen as a premium source, thus positioning companies developing and exploring in Saskatchewan in the right place.

Demand is also on a roll in our industry, with many countries looking to deploy SMRs. The first SMR in the G7 will likely be built at Ontario Power Generation’s Darlington site. Additionally, Ontario-based Bruce Power is looking to add conventional large-scale reactors. The demand growth, combined with supply uncertainty, has created a very positive sentiment for our sector.