CNSC Hearings in 2025 Set Stage for Canada's First ISR Uranium Mine

• Denison Mines is advancing the Wheeler River Project and the Phoenix deposit as Canada's first in-situ uranium mine, with targeted first production in the first half of 2028.
• The company has completed significant technical de-risking and is in the final regulatory stages, with Canadian Nuclear Safety Commission (CNSC) hearings scheduled for October and December 2025, potentially allowing construction to begin in early 2026.
• Denison's CEO argues that while the uranium spot price has declined recently, the long-term price (where most volume is traded) has remained strong, and the current equity valuations present buying opportunities.
• The Phoenix deposit is expected to produce 7-9 million pounds annually in the first five years and 3-5 million pounds annually in the latter five years, with the potential to add the Gryphon deposit for a combined 15-year mine life averaging 7-9 million pounds annually.
• CEO David Cates believes many announced uranium projects won't materialize on schedule, creating a supply shortfall that benefits near-term producers like Denison, which aims to become a high-margin intermediate producer (5-10 million pounds range).

In a wide-ranging interview, Denison Mines (TSX: DML, NYSE American: DNN) CEO David Cates provided critical insights into the company's development timeline, regulatory progress, and market positioning as it advances the Wheeler River Project in Saskatchewan. The company is developing what will become Canada's first in-situ recovery (ISR) uranium mine at the Phoenix deposit, with production targeted for the first half of 2028. Despite recent volatility in uranium spot prices affecting sentiment across the sector, Cates remains focused on the company's fundamentals and believes Denison is well-positioned to capitalize on the growing uranium supply deficit.

Market Context: Understanding Spot vs. Long-Term Pricing

While the uranium spot price has seen volatility, Cates emphasized that most uranium volumes are actually traded in the long-term market, which has maintained strength. He explained the relationship between these two pricing mechanisms:

"Most volumes, most of the actual uranium that's bought and sold that goes to a utility that actually uses it is happening in the long-term market. The long-term market is reflecting big long-term supply agreements over multiple years... The spot market is an increment... it will often express, say when the price goes up, a concern around the availability of things in the long-term market."

According to Cates, the current market dynamic of spot prices ($65-67) trailing long-term prices ($80-82) is actually normal and healthy, reflecting the premium utilities are willing to pay for guaranteed supply. The recent equity market reaction to spot price movements has created potential buying opportunities in his view, as the fundamental supply-demand imbalance remains intact.

Regulatory Pathway: Final Steps to Construction

Denison has made significant progress in the regulatory approval process after working on the project since 2019. The company cleared the technical review phase of its Environmental Impact Statement (EIS) in November 2024 and received acceptance of its final EIS in December 2024. This achievement represents a critical regulatory milestone.

The next major step is the Canadian Nuclear Safety Commission (CNSC) public hearings, now scheduled for October and December 2025. Following these hearings, Denison anticipates receiving approval in the first quarter of 2026, which would allow construction to begin shortly thereafter. Provincial approvals are also required but are on a separate timeline that is not on the critical path.

"We're expecting to be able to make a development decision and start shortly after." 

With detailed engineering work ongoing and procurement activities that began in late 2023, the company is positioning itself to move quickly once approvals are secured.

Production Profile: Phoenix & Beyond

The Phoenix deposit represents Denison's initial production asset, expected to produce between 7-9 million pounds of uranium annually during the first five years of operation, dropping to 3-5 million pounds in the latter five years of a 10-year mine life. This equates to an average of 5-6 million pounds annually over the project's lifespan.

Beyond Phoenix, Denison has the Gryphon deposit, also at Wheeler River, which could add approximately 9 million pounds annually for an additional six years. This would extend the combined mine life to around 15 years with average annual production of 7-9 million pounds. Notably, the company expects Phoenix's cash flow to internally fund Gryphon's development, reducing the need for external financing.

The company aims to position itself as a "high-margin intermediate producer" in the 5-10 million pound annual production range, focusing on quality over quantity. This strategy aims to maintain lean operations while generating substantial cash flow.

Financing Strategy: Minimizing Dilution

With a strong balance sheet and debt-free status, Denison is in an enviable position compared to many junior developers. Cates indicated the company's financing strategy for Phoenix would focus on "credit-related instruments" rather than equity raises, stating they should be a "minimal to no equity dilution story."

This approach is particularly meaningful for shareholders concerned about value preservation as the company transitions from developer to producer. The project's economics at Phoenix are robust enough that Denison does not need to wait for higher uranium prices to justify moving forward, unlike some competitors who cite price concerns as reasons for delay.

Interview with President & CEO, David Cates

Supply Reality: Industry Challenges Create Opportunity

One of the most compelling arguments Cates made concerns the uranium supply pipeline. Having worked since 2019 to develop Phoenix, he expressed skepticism about the timelines many competitors have announced, noting the significant challenges in assembling qualified teams, securing permits, and executing complex mining projects:

"Five years ago almost all of those companies had assets that were near abandoned if not actually abandoned and now...assets are being dusted off, people are saying 'well we're going to be able to build this mine.' Well I'm not sure how you go from being a staff of two people or three people in a company to all of a sudden having the team that can engineer and build and then execute one of these projects and do it what in the next two years? Come on."

This perspective suggests that the actual medium-term uranium supply response will likely be less than what many market forecasts anticipate, potentially leading to more acute supply shortages and higher prices than currently modelled. Recent operational challenges faced by Peninsula Energy and others in the sector appear to support this thesis.

Portfolio Growth: Expanding Beyond Phoenix

While Phoenix remains the near-term focus, Denison has been developing a broader asset portfolio. The company is working with Orano on the Midwest project, which is being assessed for both standard mining and ISR potential. They're also advancing the Waterbury Lake THT deposit with partner KHNP (Korea Hydro & Nuclear Power).

Additionally, Denison has strategically reorganized some non-core assets through transactions that maintain exposure while minimizing capital requirements. For example, the company has placed certain assets in partner companies where Denison maintains 20% ownership and 30% asset-level interest, allowing for exploration upside with controlled expenditure.

Canada-US Relations: Silver Linings in Trade Tensions

Addressing the current trade tensions between Canada and the United States, Cates took a surprisingly optimistic long-term view. He suggested that the situation has forced Canada to reconsider the importance of its natural resource sector and potentially create more streamlined pathways for responsible resource development.

While acknowledging the challenges, Cates noted that Canadian uranium remains highly sought after globally and is not dependent on the US market:

"Canadian uranium can go anywhere. We don't need a pipeline. We can put it in a truck to a port and we can ship it to Europe, we can ship it to Asia."

This flexibility provides strategic optionality for Denison in its future offtake agreements and reduces geopolitical risk compared to producers in other jurisdictions with more limited export options.

The Investment Thesis for Denison Mines

• Advanced Developer Near Production: Denison is advancing Wheeler River's Phoenix deposit toward becoming Canada's first in-situ uranium mine with production targeted for H1 2028, representing one of the most advanced uranium projects globally.
• Clear Regulatory Timeline: With CNSC hearings scheduled for October/December 2025 and potential approval in Q1 2026, the company has a well-defined path to construction with limited regulatory uncertainty remaining.
• Strong Economics & Balance Sheet: The Phoenix project offers high margins even at moderate uranium prices, allowing Denison to develop without waiting for higher price environments. The company is debt-free and anticipates minimal equity dilution to fund development.
• Technical De-risking Complete: Denison has conducted extensive technical work including a successful feasibility field test with actual uranium recovery, significantly reducing execution risk compared to peers.
• Supply Gap Beneficiary: The company is positioned to capitalize on a growing uranium supply deficit, with many competitor projects likely to face delays or cancellations due to technical, financial or regulatory challenges.
• Growth Beyond Initial Production: The Gryphon deposit offers potential to extend mine life to 15 years at 7-9 million pounds annually, with cash flow from Phoenix potentially funding this expansion internally.
• Established Team & Infrastructure: Unlike many juniors, Denison has built a team of 75-80 people over five years and established significant infrastructure, providing execution advantages versus competitors trying to rapidly scale up.
• Valuation Disconnect: Current market volatility has created potential entry points, with the stock trading below NAV despite strong fundamentals and near-term catalysts.

Uranium Supply-Demand Imbalance: The Macro Opportunity

The uranium market is characterized by a growing disconnect between projected demand and realistic supply. While numerous companies claim to have near-term production potential, the extensive lead times, technical complexity, and rigorous regulatory requirements for uranium projects make many of these projections unrealistic. As Denison CEO David Cates notes:

"To think that we will have this enormous supply response is, I think, naive. We will have less response than people believe if they look at all of the different reports and pitches from all the different companies doing their best."

This reality is further reinforced by recent technical difficulties faced by early movers attempting to restart production. While demand for uranium continues to grow with nuclear power expansion globally and extended reactor lifetimes, primary production remains well below annual consumption. Current utility inventory drawdowns and secondary supplies like underfeeding are temporary solutions that cannot bridge the growing gap indefinitely.

Recent spot price volatility has overshadowed the steadily increasing long-term price, where most volume is actually traded. This divergence has created opportunities in equities that don't reflect the fundamental supply constraints ahead.