Wednesday 26th October 2016

Resource Clips

Posts tagged ‘Denison Mines Corp. (DML)’

Industry expert Mark Lackey takes the helm at ALX Uranium

October 26th, 2016

by Greg Klein | October 26, 2016

A frequent media commentator whose 40-year career covers energy, mining, central and corporate banking, and investment research and strategy, Mark Lackey joins ALX Uranium TSXV:AL as president/CEO/director.

Industry expert Mark Lackey takes the helm at ALX Uranium

Mark Lackey brings his
expertise to ALX Uranium.

Lackey has served as a Bank of Canada economist responsible for U.S. economic forecasting and as senior commodities manager at the Bank of Montreal, as well as in positions with Gulf Canada, Chevron Canada, Petro Canada and Ontario Hydro.

Lackey has also held positions with Brawley Cathers, Blackmont Capital, Hampton Securities and Pope & Company. More recently he’s served as executive VP at CHF Investor Relations and technical adviser at Presmont Group.

Recognized as an industry expert, he’s commented frequently on BNN and the Sun Network, among over 300 TV appearances in recent years. He discusses commodities in general, but media most often ask for his insight on uranium trends including supply and demand, as well as his analysis on individual uranium companies.

“Over the last few years ALX has established a team of professionals with significant technical depth and one that has many years of experience exploring in the Athabasca Basin,” said Lackey. “I believe the future of this company and the uranium sector is very bright.”

Lackey replaces Jon Armes, who steps down to pursue other opportunities but stays on as a consultant. During his six years of leadership at ALX and its predecessor Lakeland Resources, Armes helped build one of the Athabasca Basin’s largest and most prospective uranium exploration portfolios. Most recently he negotiated the Hook-Carter transaction that benefits ALX with the experience and budget of Denison Mines TSX:DML.

ALX Uranium welcomes Denison Mines to southwestern Athabasca Basin’s “elephant country”

October 13th, 2016

by Greg Klein | October 13, 2016

ALX Uranium TSXV:AL gets 7.5 million shares of Denison Mines TSX:DML, retains a 20% stake in the Hook-Carter project and has its portion of $12 million in spending covered as Denison moves into the southwestern Athabasca Basin. Under a deal announced October 13, Denison becomes project operator, bringing its expertise to the 16,805-hectare property in the Patterson Lake South region.

ALX Uranium welcomes Denison Mines to southwestern Athabasca Basin’s elephant country

“This is elephant country—a large property that has seen very little drilling on a geological trend with a precedent for large and high-grade uranium deposits,” commented Denison VP of exploration Dale Verran.

“The Hook-Carter property is uniquely situated on the Patterson Lake corridor, offering potential for both basement-hosted deposits, similar to Triple R and Arrow, and unconformity-hosted deposits which remain the largest and highest grade in the Athabasca Basin, namely McArthur River and Cigar Lake which are both operating mines. With Athabasca sandstone thicknesses similar to the Wheeler River project, the property plays to our team’s strengths and we are very excited to get started with exploration in 2017.”

So far Hook-Carter has undergone just eight historic holes, five of them on the property’s 15 kilometres of the Patterson Lake conductive corridor, which hosts Fission Uranium’s (TSX:FCU) Patterson Lake South, NexGen Energy’s (TSX:NXE) Rook 1 and Hook Lake, a joint venture of Purepoint Uranium TSXV:PTU, Cameco Corp TSX:CCO and AREVA Resources Canada. Hook-Carter also features additional potential along significant sections of the Derkson and Carter corridors.

Subject to approvals, Denison’s work requirement calls for $3 million over the first three years. Should the company fail to meet the commitment, ALX’s stake in the property increases from 20% to 25%. Additionally, Denison funds ALX’s portion of the first $12 million in spending. The companies plan a JV three years after closing the agreement.

“Denison has made a number of world class uranium discoveries within the Athabasca Basin and, given their experience, we believe that they will advance the project diligently and methodically,” said ALX president/CEO Jon Armes. “Knowing that Hook-Carter will see considerable exploration efforts over the next 36 months, the company will focus on exploration at its other high-quality exploration projects in and around the shallow margins of the Athabasca Basin, which include Gorilla Lake, Newnham Lake, Gibbon’s Creek and Lazy Edward Bay.”

Battle in the Basin

July 15th, 2016

Backed by big money, Fission and NexGen compete for uranium prominence

by Greg Klein

NexGen Energy’s July 15 move to the TSX big board (TSX:NXE) marks another milestone of the almost phenomenal progress in and around Saskatchewan’s southwestern Athabasca Basin. In March the company’s Rook 1 project came from behind to surpass the deposit size of Fission Uranium’s (TSX:FCU) more advanced Patterson Lake South. Now both companies focus on regional exploration as well as resource expansion, leaving observers wondering just how much more uranium the region has to offer.

NexGen has seven rigs onsite for its largest season ever, at least 35,000 metres. Eight summer targets include the Arrow resource, due for stepouts as well as delineation, a massive pitchblende-bearing area 180 metres southwest, the Cannon discovery to the northeast and five other conductive areas running southwest to northeast across the property.

Backed by big money, Fission and NexGen compete for uranium prominence

NexGen has an H2 resource update scheduled for Rook 1’s Arrow zone.

Fission’s summer calls for 52 holes and 15,200 metres, most of it outside the Triple R resource. The company hopes to fill in some of the gaps between the deposit and other zones along a trend now 2.58 kilometres long. Sixteen holes will test regional exploration targets.

Fission also plans further EM work and, with pre-feas in mind, a seismic survey, geotechnical borehole testing, hydrogeology wells and Phase II metallurgical studies.

Last spring’s resource estimate for NexGen’s Arrow zone used a 0.25% cutoff on four parallel shear structures to report an inferred total of 3.48 million tonnes averaging 2.63% for 201.9 million pounds U3O8. With the deposit open in most directions, the company hopes to release an expanded, upgraded resource this year.

Fission’s September 2015 estimate for the two-zone Triple R deposit used a 0.2% open pit cutoff and 0.25% underground cutoff for a resource totalling:

  • indicated: 2.01 million tonnes averaging 1.83% for 81.11 million pounds U3O8

  • inferred: 785,000 tonnes averaging 1.57% for 27.16 million pounds

The deposit remains open in multiple directions, Fission states. Triple R reached PEA last September.

Fission has the shallower deposit, about 55 to 200 metres below surface. NexGen’s resource extends to about 800 metres but it’s land-based while most of Fission’s resource and its other zones lie under a lake. Both deposits are basement-hosted, avoiding the leaking sandstone problems that plagued Cigar Lake.

Fission’s summer budget comes to $13.3 million, slightly less than NexGen’s $14 million. Fission’s well-funded following last January’s $82.2-million private placement that gave Hong Kong-based uranium trader CGN Mining a nearly 20% stake in the company. NexGen took a different approach, issuing US$60 million in convertible debentures to CEF Holdings, shared 50/50 by CK Hutchinson Holdings and CIBC. That leaves NexGen with about $100 million on hand and the possibility of paying off the debt.

Does that suggest the company contemplates production revenue in its future? CEO Leigh Curyer can give that impression. The former CFO of a Uranium One predecessor takes credit for managing South Australia’s Honeymoon project through feasibility. Late last month he announced three new staffers holding “combined experience with permitting, development and operating mines.”

By contrast Fission chairperson/CEO Dev Randhawa has openly courted suitors, as in the failed merger with Denison Mines TSX:DML that preceded the CGN deal. The question of who ends up owning how much uranium in the region inspires wide-ranging speculation. Meanwhile expansion and development of the two projects can only enhance their attractiveness.

The region’s northeasterly reach of mineralization hardly stops at Rook 1’s border, as Purepoint Uranium TSXV:PTU demonstrates at Hook Lake. Last winter’s drilling reaffirmed interest in the project’s Spitfire zone, a few kilometres beyond NexGen’s Bow discovery. The season’s last hole revealed Spitfire’s best assay yet—10.3% U3O8 over 10 metres, starting at 237.6 metres in downhole depth and including 53.5% over 1.3 metres.

Backed by money from JV partners Cameco Corp TSX:CCO and AREVA Resources Canada (39.5% each), operator Purepoint has another round of drilling in the planning stages.

Wheeler River PEA buoyant even with cautious uranium price forecast

April 4th, 2016

by Greg Klein | April 4, 2016

Two high-grade eastern Athabasca Basin uranium deposits could form a single mining operation lasting 16 years, according to the Wheeler River joint venture’s PEA. Operator Denison Mines TSX:DML released the figures April 4 from a study that incorporates the McClean Lake mill and bases its numbers on a conservative price forecast.

Wheeler River PEA buoyant even with cautious uranium price forecast

McClean Lake expansion should provide
excess capacity of six million pounds a year.

Using an 8% discount rate, the pre-tax NPV comes to $513 million with a 20.4% IRR. Each of the three partners would face a different tax scenario, Denison pointed out. The company holds a 60% stake in the JV with Cameco Corp TSX:CCO (30%) and JCU (Canada) Exploration (10%).

Initial capex would come to $560 million and sustaining capex another $543 million. Payback was reckoned at about three years.

Those numbers assume a uranium price of $44 per pound U3O8, the current long-term contract price according to Denison. (In lieu of a spot price, UEX Consulting provided a very low March 28 price indicator of $29.15.)

By comparison, Fission Uranium’s (TSX:FCU) September PEA for Patterson Lake South considered a price of $65 per pound. Cameco’s average realized price for 2015 came to $57.58, partly bolstered by the weak Canadian dollar.

But should uranium reach $62.60, Wheeler River’s PEA projects a pre-tax NPV of $1.42 billion and a 34.1% IRR.

The “conventionally mined” basement-hosted Gryphon deposit would enter production first. The unconformity-hosted Phoenix, located below water-saturated sandstone, would require Cigar Lake techniques of ground-freezing and remote-control jet-boring. The two Wheeler River deposits lie three kilometres apart on the 11,720-hectare property.

The Phoenix resource used a 0.8% cutoff to show:

  • indicated: 166,400 tonnes averaging 19.14% for 70.2 million pounds U3O8
  • inferred: 8,600 tonnes averaging 5.8% for 1.1 million pounds

Gryphon’s resource used a 0.2% cutoff:

  • inferred: 834,000 tonnes averaging 2.31% for 43 million pounds

Cutoff grades were based on an assumed price of $50 per pound. The Phoenix indicated category has the world’s highest grade of any undeveloped uranium deposit, Denison states. High-grade Gryphon assays from last winter’s drilling have yet to be incorporated into the resource.

The study sees Gryphon production beginning in 2025, turning out around 40.7 million pounds over seven years. Phoenix would follow with 64 million pounds over nine years. Milling would take place at McClean Lake, expected to have excess capacity of six million pounds a year when expansion finishes by the end of 2016. Denison holds a 22.5% share of the mill, along with AREVA Resources Canada (70%) and OURD Canada (7.5%).

“Thanks to the existing infrastructure in the eastern Athabasca Basin, our ownership interest in the McClean Lake mill, and a project designed to minimize risk and upfront capex, the Wheeler River project has the potential to emerge as one of the next producing assets in the region,” stated Denison president/CEO David Cates.

Last week the company announced an all-share deal in which GoviEx Uranium CSE:GXU would acquire all of Denison’s African assets. Expected to close next month, the transaction would leave Denison with 25% of GoviEx outstanding shares and 28% on a fully diluted basis.

Chinese uranium trader signs LOI for $82-million strategic investment with Fission

December 21st, 2015

by Greg Klein | December 21, 2015

While campaigning on behalf of the doomed merger with Denison Mines TSX:DML last July, Fission Uranium TSX:FCU chairperson/CEO Dev Randhawa defended the proposal by saying, “One of the things I run into when I go to Asia is they say I’m too small.” But on December 21 the company announced a letter of intent for an $82.22-million private placement from a Hong Kong-listed uranium trader, CGN Mining Company Ltd. Its controlling shareholder is China Uranium Development Company Ltd, a subsidiary of the energy utility China General Nuclear Power Corp. The deal would leave CGN with 19.99% of Fission.

Chinese uranium trader signs LOI for $82-million strategic investment with Fission

The $82-million deal would give a Chinese
company nearly 20% of the Triple R deposit.

Randhawa called it “the first time a Chinese company has invested directly in a Canadian uranium company.” The parties also pledged to work towards an offtake agreement.

They hope to close by January 29. Among the requirements are approvals from the TSX, CGN shareholders, the Hong Kong exchange and the Chinese government. Should either party back out or CGN fail to win approvals by February 29, a $3-million break fee takes effect.

CGN would nominate two directors to Fission’s board, which would grow from seven to nine members.

Last June the Canadian government approved Australia-headquartered Paladin Energy’s (PDN) ownership of the proposed Michelin mine in Labrador, relaxing a 1987 policy that requires at least 51% Canadian ownership of uranium mines. The policy doesn’t apply to exploration and development projects.

Fission’s Patterson Lake South project, just outside Saskatchewan’s Athabasca Basin, reached PEA in September with numbers that the company said makes its Triple R deposit potentially one of the world’s lowest-cost uranium producers. Last week the company fended off dissident shareholders to elect its management slate to the board.

Fission’s next-door neighbour hasn’t done badly in financing either. Last month NexGen Energy TSXV:NXE announced a $20-million bought deal, which followed a $23.74-million private placement that closed in May. The Arrow zone of the company’s Rook 1 project has its maiden resource scheduled for H1 2016.

Update 2: Fission Uranium fights off dissidents as management’s slate elected

December 15th, 2015

by Greg Klein | December 15, 2015

Fission Uranium TSX:FCU bosses won their latest skirmish with dissatisfied investors as incumbent directors and the management’s one new nominee were elected to the board. Voters representing 51.16% of eligible shares, constituting “record shareholder turnout,” sided with the status quo, Fission announced December 15. The company reported percentages for the seven directors that ranged from a low of 80.37% for chairperson/CEO Dev Randhawa to 89.13% for Ross McElroy, Fission’s president, COO and head geologist.

The company reported a total of 197,855,736 shares voted at the meeting, but the board election drew about 167.7 million votes, media rep David Matthews informed

Fission fights off dissidents as management’s slate elected

Dev Randhawa argues for the Denison merger at an October meeting. The proposal got majority support but fewer than the two-thirds
vote required from Fission shareholders.

“Notwithstanding a withhold campaign launched by a small group of dissident shareholders to withhold votes from the entire board, we have received overwhelming and conclusive support from our shareholders that says we are on the right track and have the plan needed to ensure that PLS and its Triple R deposit reach its full potential,” Randhawa maintained. “We hope that once and for all this puts an end to their costly and distractive campaign against the company.”

Initially triggered by opposition to Fission’s proposed merger with Denison Mines TSX:DML, a group called FCU Oversight presented its own candidates in November. The group withdrew its slate early this month, saying it wasn’t until after leader Jim Gifford submitted his list, “as required by Fission’s last-minute adoption of an advanced notice policy,” that the company revealed change-of-control payouts could put shareholders “on the hook for millions of dollars.” Executive pay was one of the dissidents’ concerns. The group then advised shareholders to vote withhold “to force the current directors to resign.”

Fission’s slate drew support from Rick Rule of Sprott U.S. Holdings, as well as proxy advisory firms Institutional Shareholder Services and Glass, Lewis & Co.

New to the board, which numbered six prior to the election, is Raffi Babikian, whose career “encompasses just about every aspect of the uranium business including M&A activity for AREVA,” according to an earlier statement from Randhawa.

In a brief response to the election, FCU Oversight said Fission “now has the latitude and licence to conduct the business of the company as they [see] fit. We hope that they will act in the long-term interests of all Fission shareholders.”

Patterson Lake South’s still up for grabs as Fission/Denison merger fizzles

October 13th, 2015

by Greg Klein | October 13, 2015

Two renowned dealmakers have failed in their plan to merge the Athabasca Basin’s two most prominent exploration companies. On October 13 Fission Uranium TSX:FCU and Denison Mines TSX:DML announced that proxies submitted four days earlier showed majority support from both companies but fell short of the two-thirds vote required from Fission shareholders. The companies called off shareholders’ meetings scheduled for October 14.

Patterson Lake South’s still up for grabs as Fission-Denison merger fizzles

Potentially one of the world’s lowest-cost uranium mines
according to its PEA, Patterson Lake South seeks a new owner.

Fission shareholders expressed skepticism soon after the proposal was announced in early July, putting CEO Dev Randhawa on the defensive in a conference call. To drum up support, he and Denison director Lukas Lundin then spoke to shareholders at an October 6 town hall meeting in Toronto.

The deal would offer Fission “superb access to capital via the Lundin Group,” as well as a large Denison portfolio featuring its 60%-held Wheeler River project and 22.5% interest in the McClean Lake mill, Randhawa maintained. He and Lundin noted “two of the leading independent proxy advisory firms,” Institutional Shareholder Services and Glass Lewis & Co, recommended a yes vote.

A week prior to the proxies, the National Post’s Peter Koven reported strong support from Fission’s institutional shareholders but stated “the vast majority of the stock is held by retail shareholders, some of whom are loudly resisting the deal.”

A website called FCU Oversight argued that from the outset the terms severely undervalued Fission’s sole asset, Patterson Lake South, and included “no value” for the preliminary economic assessment released in early September.

FCU Oversight added that Denison’s “Athabasca projects are located on the eastern side of the basin and are not considered as robust, or as readily minable. The balance of Dennison’s [sic] international assets are simply not synergistic to Fission.” The website also questioned the appointments of Fission brass to positions with the new company.

Randhawa told Koven he foresaw no deal with giants like Cameco Corp TSX:CCO or AREVA. Fission has shown no interest in taking PLS into production itself. In fact the company was set up specifically to be sold after spinning out its other assets to Fission 3.0 TSXV:FUU to make PLS a more attractive take-out target.

Foreign suitors might be emboldened by last June’s federal government decision to allow Australian Paladin Energy’s (PDN) ownership of its proposed Michelin mine in Labrador. Canada requires at least 51% domestic ownership of uranium operations but allows exceptions when no Canadian partners materialize.

The failed merger marks the second time PLS has slipped through Denison’s fingers. The company nearly got the project in November 2012 with Denison’s takeover of Fission Uranium’s predecessor, Fission Energy. Before the deal was signed, Fission Energy’s joint venture partner Alpha Minerals struck massive pitchblende and strong radioactivity in the project’s discovery hole. Randhawa renegotiated the deal with Lundin to exclude the project. Fission Uranium bought out Alpha the following year.

Cameco and AREVA finally celebrate Cigar Lake’s official opening

September 23rd, 2015

by Greg Klein | September 23, 2015

Delays have been a matter of course for Cigar Lake throughout its 33-year history. So why not wait 18 months to announce the mine’s official opening? Cameco Corp TSX:CCO and AREVA Resources Canada did just that on September 23 as they celebrated the start of mine and mill production with speeches and tours.

Discovered in 1981, Cigar Lake began extraction in March 2014, while McClean Lake packaged the mine’s first concentrate the following October. The mill’s been processing other mine feed since 1999.

Cameco and AREVA finally celebrate Cigar Lake’s official opening

Cigar Lake began operation in March 2014 but now it’s official.

Better late than never, Cameco president/CEO Tim Gitzel exclaimed, “This achievement took 10 years, great perseverance and technical creativity, and I commend the many people who contributed.”

Figures for 2015 so far show the eastside Athabasca Basin mill processed 6.1 million pounds U3O8 from Cigar Lake ore, reaching the lower end of the year’s target of six million to eight million packaged pounds. With that target under review, Cameco promised an update in its Q3 report. Full production of 18 million pounds is expected by 2018.

The company has now commissioned three jet boring machines, high-pressure water jets that extract ore from frozen rock 410 to 450 metres underground “at the interface between dry basement rock and the water-bearing sandstone above.” But efficient operation “may halt and resume mining several times during a quarter without impacting planned annual production.”

Some 70 kilometres northeast, McClean Lake expansion continues, with construction expected to finish next year. Full capacity has been targeted at 24 million pounds uranium annually. The mill has churned out over 52 million pounds of concentrate since 1999.

Operator Cameco holds a 50.025% stake in the Cigar Lake joint venture, along with AREVA (37.1%), Idemitsu Canada Resources (7.875%) and TEPCO Resources (5%). Over 600 people work there.

AREVA’s 70% share makes it majority owner as well as operator of McClean Lake, with other JV partners being Denison Mines TSX:DML (22.5%) and OURD Canada (7.5%). This operation employs over 350 workers.

Read more about Cigar Lake.

Lakeland Resources/Alpha Exploration combination gets shareholder approval

September 15th, 2015

by Greg Klein | September 15, 2015

A new Athabasca Basin explorer named ALX Uranium Corp came closer to inception on September 15 after shareholders of Lakeland Resources TSXV:LK and Alpha Exploration TSXV:AEX voted overwhelmingly in favour of combining the two companies.

The proposal won support from 96.01% of Alpha shareholders and 97% of Alpha security holders (shareholders and warrant holders), while Lakeland shareholders voted 95.76% in favour.

I call that a merger of two juniors to strengthen the balance sheet, increase resource science capabilities and bring together experienced management teams and board members.—Thomas Drolet, quoted in Streetwise Reports

In a Streetwise Reports interview posted the same day, energy expert and Lakeland adviser Thomas Drolet called the plan “a merger of two juniors to strengthen the balance sheet, increase resource science capabilities and bring together experienced management teams and board members.” Contrasting the deal with the proposed Fission Uranium TSX:FCU/Denison Mines TSX:DML merger, Drolet said the Lakeland/Alpha combination comprises “a different kind of M&A. It is more a merger of two juniors that want to stay in the E&P extraction business, get on with drilling and strengthen their balance sheets.”

Their combined portfolio would be one of the Basin’s largest, with “a string of Tier 1 drill targets,” according to Lakeland CEO Jonathan Armes.

Should further approvals come from the TSXV and British Columbia Supreme Court, the two companies anticipate ALX Uranium will debut on September 25’s opening buzzer.

Read more about the Lakeland Resources/Alpha Exploration combination.

Disclaimer: Lakeland Resources Inc is a client of OnPage Media Corp, the publisher of The principals of OnPage Media may hold shares in Lakeland Resources.

PLS reaches PEA

September 3rd, 2015

Fission Uranium sees Triple R potentially one of the world’s lowest-cost producers

by Greg Klein

Ever since Alpha Minerals’ November 2012 discovery, other explorers have basked in Patterson Lake South’s reflected glory. Now Fission Uranium TSX:FCU has plans that could further boost its own fortunes while complementing others. A proposed new mill would create a potential “key centrepiece for the western Athabasca Basin—with the potential to process ore from other high-grade projects in the region as they are taken into production,” says president/COO Ross McElroy. That’s one of the highlights of the preliminary economic assessment announced September 3 for the Triple R deposit’s proposed open-pit/underground mine and mill.

The numbers look good, especially with average operating costs of US$14.02 per pound U3O8 over a 14-year lifespan, “making Triple R potentially one of the lowest-cost uranium producers in the world,” Fission boasted.

Fission Uranium sees Triple R potentially one of the word’s lowest-cost producers

Taking less than three years from discovery to PEA, Patterson Lake
South encouraged a busy area play around the southwestern Basin.

Those numbers, however, assume a substantial uranium price recovery to US$65 a pound and a continually weak northern peso floundering at US$0.85.

Using a 10% discount rate, the figures show a post-tax net present value of $1.02 billion (all dollar figures Canadian, except where noted) and a 34.2% post-tax internal rate of return.

The study estimates initial capital costs at $1.1 billion, with a prompt post-tax payback in 1.7 years.

The high-grade deposit would produce around 100.8 million pounds of U3O8 with 95% metallurgical recovery, bringing 77.5 million pounds in the operation’s first six years and another 24 million pounds over the following eight years. Annual production would average 7.2 million pounds over 14 years.

The study updates Triple R’s maiden resource but doesn’t include the recently expanded R600W zone to the west. The resource used a 0.2% open pit cutoff and 0.25% underground cutoff for a total of:

  • indicated: 2.01 million tonnes averaging 1.83% for 81.11 million pounds U3O8

  • inferred: 785,000 tonnes averaging 1.57% for 27.16 million pounds

The September 3 announcement doesn’t mention Triple R’s gold: 38,000 ounces indicated and 16,000 ounces inferred.

Triple R takes in two zones, the land-based R00E and the much larger R780E, lying 225 metres east under about six metres of water.

Those numbers, however, assume a substantial uranium price recovery to US$65 a pound and a continually weak northern peso floundering at US$0.85.

The PEA attributes its low opex partly to an open pit/underground design taking advantage of the big but shallow, high-grade, basement-hosted deposit. The hybrid mine would feature dykes and slurry walls for water control. “High-grade mineralization (above 4% U3O8) is captured within the open pit, eliminating the need for expensive, specialized underground mining methods.”

The design would use “proven techniques successfully implemented at a number of Canadian mining operations, including the Diavik diamond mine and the Meadowbank gold mine,” the PEA states. “The development scenario does not require any new, untested, conceptual mining or construction methods.”

In other words, it’s not another Cigar Lake. The study foresees about three years of pre-production.

The open pit would produce a total of 1.56 million tonnes averaging 2.21%, while the underground portion would come to 3.25 million tonnes averaging 0.42%. Total production would hit 4.8 million tonnes at 1%.

Of course the proposed new mill, not to mention McElroy’s buoyant remarks, will be welcomed by the region’s other explorers, most notably NexGen Energy TSXV:NXE but also including several earlier-stage projects.

The PEA announcement precedes closure of Fission’s proposed merger with Denison Mines TSX:DML, which the companies anticipate next month. Initial reaction to the merger from Fission shareholders, however, was less than enthusiastic. The deal requires their two-thirds support, as well as 50% plus one from Denison owners. Could such an encouraging PEA bolster the resistance of some Fission voters?

The suitors have mentioned that Denison’s connection with the Lundin Group brings access to mining expertise. But they’ve also left open the possibility of selling part or all of their combined portfolio. In a corporate video released prior to the PEA, CEO/chairperson Dev Randhawa said, “You do not have to be a uranium company to mine this.”