TORONTO, Sept. 24,
2024 /PRNewswire/ - Denison Mines
Corp. ("Denison" or the "Company") (TSX:
DML) (NYSE American: DNN) is pleased to announce that is has
executed an option agreement (the "Option
Agreement") with a Nasdaq listed company to be renamed
Foremost Clean Energy Ltd ("Foremost") (NASDAQ: FMST) (CSE:
FAT), which grants Foremost an option to acquire up to 70% of
Denison's interest in 10 uranium exploration properties
(collectively, the "Transaction"). Pursuant to the
Transaction, Foremost would acquire such total interests upon
completion of a combination of direct payments to Denison and
funding of exploration expenditures with an aggregate value of up
to approximately $30 million. View
PDF version
David Cates, President & CEO
of Denison, commented, "Denison is pleased to work with
Foremost to enhance the potential for discovery on an excellent
portfolio of uranium exploration properties that would otherwise
receive little attention from Denison with our current focus on
development and mining stage projects. We are impressed with
Foremost's leadership team and technical capabilities and are
excited to see high-potential exploration work being carried out on
these properties in the coming years.
The Transaction is structured to incentivize exploration
activity, with Foremost required to invest a minimum of
$8 million in exploration
expenditures to retain any interests in the properties and
$20 million in exploration
expenditures to fully exercise the option."
Key Transaction Highlights:
- Collaboration with Foremost is expected to increase exploration
activity on a portfolio of non-core Denison properties with
the potential to increase the probability of discovery within
Denison's vast Athabasca Basin
exploration portfolio
- Denison to receive meaningful consideration in the form of an
upfront payment in Foremost common shares (representing ~19.95%
ownership interest in Foremost post transaction), cash or common
share milestone payments, and up to $20
million in project exploration expenditures
- Denison retains direct interests in the optioned exploration
properties and will become Foremost's largest shareholder, while
also securing certain strategic pre-emptive rights to participate
in future exploration success from the optioned properties
Exploration Properties subject to the Option
Agreement
The 10-project portfolio subject to the Option Agreement (the
"Exploration Properties") consists of the following
properties: Murphy Lake South, Hatchet
Lake, Turkey Lake, Torwalt Lake, Marten, Wolverine,
Epp Lake, Blackwing, GR and CLK. See
Figure 1 for the location of the optioned
properties. Denison currently has 100% ownership in all
of the properties except for Hatchet
Lake, which is subject to a joint venture agreement with
Eros Resources Corp., with Denison currently holding a 70.15%
ownership interest.
Collaboration between Denison and Foremost
Foremost is expected to act as project operator during the term
of the Option Agreement; however, Denison expects to leverage its
significant team of technical experts based in its office in
Saskatoon, Saskatchewan to support
Foremost as it transitions to uranium exploration. Upon completion
of Phase 1 of the Option Agreement, Denison will be the largest
shareholder of Foremost, holding ~19.95% of the issued and
outstanding shares of Foremost and will retain a significant direct
ownership interest in the Exploration Properties. Additionally,
David Cates, President and CEO of
Denison, is expected to join Foremost's Board of Directors.
Key Terms of the Transaction
Under the terms of the Option Agreement, Foremost may acquire up
to 70% of Denison's interest in the Exploration Properties. In
the case of Hatchet Lake, Foremost
may earn up to a 51% interest in the Hatchet Lake joint venture, representing
slightly over 70% of Denison's current ownership
interest.
The Option Agreement contains three (3) phases, as summarized
below:
Phase 1
To earn an initial 20% interest in the Exploration Properties
(14.03% for Hatchet Lake), on or
before October 7, 2024 (the
"Effective Date"), Foremost must:
- Issue 1,369,810 common shares to Denison;
- Appoint a Technical Advisor to Foremost at Denison's election;
and
- Enter into an Investor Rights Agreement providing for, among
other things: the appointment by Denison of up to two (2)
individuals to the board of directors of Foremost; and a
pre-emptive equity participation right for Denison to maintain a
19.95% equity interest in Foremost.
Phase 2
To earn an additional 31% interest in the Exploration Properties
(21.75% for Hatchet Lake), on or
before the date 36 months following the Effective Date,
Foremost must:
- Pay Denison $2,000,000 in
cash or common shares or a combination thereof, at the discretion
of Foremost; and
- Incur $8,000,000 in exploration
expenditures on the Exploration Properties.
If the conditions of Phase 2 are not satisfied, Foremost shall
forfeit the entirety of its interests in and rights to the
Exploration Properties.
Phase 3
To earn an additional 19% interest in the Exploration Properties
(15.22% for Hatchet Lake), on or
before the date 36 months following the successful completion
of Phase 2, Foremost must:
- Pay Denison a further $2,500,000 in cash or common shares or a
combination thereof, at the discretion of Foremost; and
- Incur a further $12,000,00 in
exploration expenditures on the Exploration Properties.
If the conditions of Phase 3 are not satisfied, Foremost shall
forfeit a portion of its interests in and rights to the Exploration
Properties such that Denison's interests in each of the Exploration
Properties will be increased to 51% and operatorship shall revert
to Denison.
Upon completion of either Phase 2 or Phase 3 (as applicable) of
the Option Agreement, the parties will enter into a joint venture
agreement in respect of each of the Exploration Properties.
About Denison
Denison is a uranium mining, exploration and development
company with interests focused in the Athabasca Basin region of northern
Saskatchewan, Canada. The Company
has an effective 95% interest in its flagship Wheeler River Uranium
Project, which is the largest undeveloped uranium project in the
infrastructure rich eastern portion of the Athabasca Basin
region of northern Saskatchewan.
In mid-2023, a feasibility study was completed for the
Phoenix deposit as an in-situ
recovery ("ISR") mining operation, and an update to the previously
prepared 2018 Pre-Feasibility Study was completed for Wheeler
River's Gryphon deposit as a conventional underground mining
operation. Based on the respective studies, both deposits have the
potential to be competitive with the lowest cost uranium mining
operations in the world. Permitting efforts for the planned Phoenix
ISR operation commenced in 2019 and have advanced significantly,
with licensing in progress and a draft Environmental Impact Study
("EIS") submitted for regulatory and public review in October 2022.
Denison's interests in Saskatchewan also include a 22.5% ownership
interest in the McClean Lake Joint Venture ("MLJV"), which includes
unmined uranium deposits (planned for extraction via the MLJV's
SABRE mining method starting in 2025) and the McClean Lake uranium
mill (currently utilizing a portion of its licensed capacity to
process the ore from the Cigar Lake mine under a toll milling
agreement), plus a 25.17% interest in the MWJV's Midwest Main and
Midwest A deposits, and a 69.44% interest in the Tthe Heldeth Túé
("THT") and Huskie deposits on the Waterbury Lake Property. The
Midwest Main, Midwest A, THT and Huskie deposits are located within
20 kilometres of the McClean Lake mill. Taken together, Denison has
direct ownership interests in properties covering ~384,000 hectares
in the Athabasca Basin
region.
Additionally, through its 50% ownership of JCU (Canada) Exploration Company, Limited ("JCU"),
Denison holds additional interests in various uranium project joint
ventures in Canada, including the
Millennium project (JCU, 30.099%), the Kiggavik project (JCU,
33.8118%), and Christie Lake (JCU,
34.4508%).
In 2024, Denison is celebrating its 70th year in uranium
mining, exploration, and development, which began in 1954 with
Denison's first acquisition of mining claims in the Elliot Lake region of northern Ontario.
Follow Denison on X (formerly Twitter) @DenisonMinesCo
About Foremost
Foremost is currently named Foremost Lithium Resource &
Technology Ltd. (NASDAQ: FMST) (CSE: FAT) (FSE: F0R0) (WKN: A3DCC8)
and intends to change its name to Foremost Clean Energy Ltd.
in connection with the Transaction. Assuming the
effectiveness of the Transaction, Foremost will be an emerging
North American uranium exploration company with interests in 10
prospective properties spanning over 330,000 acres in the prolific,
uranium-rich Athabasca Basin. As
global demand for decarbonization accelerates, the need for nuclear
power is crucial. Foremost expects to be positioned to capitalize
on the growing demand for uranium through discovery in a top
jurisdiction with the objective to support the world's energy
transition goals. Alongside its exploration partner Denison,
Foremost will be committed to a strategic and disciplined
exploration strategy to identify resources by testing drill–ready
targets with identified mineralization along strike of recent major
discoveries.
Foremost also maintains a secondary portfolio of significant
lithium projects at different stages of development spanning over
50,000 acres across Manitoba and
Quebec. For further information
please visit the company's website
at www.foremostcleanenergy.com.
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 terminology such as 'potential', '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 results 'may', 'could', 'would', 'might' or
'will' 'be taken', 'occur' or 'be
achieved'.
In particular, this news release contains forward-looking
information pertaining to Denison's current intentions and
objectives with respect to, and commitments set forth in, the
Option Agreement and ancillary agreements and the expected
benefits thereof; the
assumption that the transactions set forth in the Option
Agreement will be completed as described; the Company's
exploration, development and expansion plans and
objectives for the Exploration Properties and other
Company projects; and expectations regarding its
joint venture ownership interests and the continuity of its
agreements with its partners and third parties.
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, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of Denison to be materially different
from those expressed or implied by such forward-looking
statements. For example, the parties to the
Option Agreement may not complete the option phases as
described and/or the exploration
objective for the Exploration Properties may not be
achieved. In addition, Denison may decide or
otherwise be required to discontinue testing,
evaluation and other work on the
Company's other properties if it is unable to maintain or
otherwise secure the necessary resources (such as testing
facilities, capital funding, joint venture
approvals, regulatory approvals, etc.).
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 accurate and results
may differ materially from those 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
28, 2024 under the heading
'Risk Factors' or in subsequent
quarterly financial reports. These factors are
not, and should not be construed as being,
exhaustive.
Accordingly, readers should not place undue reliance on
forward-looking statements. The forward-looking 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 this news release to conform such information to actual
results or to changes in Denison's expectations except
as otherwise required by applicable legislation.
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SOURCE Denison Mines Corp.