Denison Mines: Both Wheeler River & Midwest Moving Forward

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Denison Mines announced last week that it had received the Provincial Environmental Assessment (EA) approval for its flagship Wheeler River project, located in the Athabasca Basin. The company also announced positive results from a Preliminary Economic Assessment (PEA) for its Midwest project, also located in Saskatchewan's Athabasca Basin. Both announcements were positive and material with respect to advancing and de-risking of the individual assets. It's been quite the busy summer from Denison's standpoint, in addition to the Provincial approval of Wheeler River, the company also recently announced the start of production from the McLean Lake JV (MLJV) using the SABRE mining method. Lastly, a positive PEA for ISR mining at the Midwest deposit was also recently announced. Given the updates, we increase our 12-month price objective for Denison shares. Our revised C$3.60 (rounded) per share target is derived from a 1.30x multiple (previously 1.20x) to our updated NAV-based project estimates. Our new price objective equates to upside of +23% from the most recent close (August 8, 2025). Denison shares currently trade at a 1.06x P/NAV multiple.

PROVINCIAL APPROVAL OF WHEELER RIVER EA

Last week the Province of Saskatchewan issued a Ministerial Approval for the Environmental Assessment of the Wheeler River project. After years of development work, this marks a milestone event for the project as one of the final regulatory approvals was received ahead of the planned start of construction for the Phoenix ISR mine. After years in the midst of the permitting process, all that remains is approval from the Canadian Nuclear Safety Commission (CNSC), in order to obtain the Federal EA and the Federal License to Prepare the Site & Construct. The public hearings have already been scheduled for later this year. The provincial EA is substantially similar to the Federal EA. Ahead of the upcoming public hearings, note that the engineering design efforts are approximately 80% complete. Detailed design engineering for the proposed ISR mine project at the Phoenix deposit commenced in early 2024 and continues to be on track for substantial completion prior to the commencement of construction, which is currently expected to occur following a final investment decision (FID) in 1H/2026.

FIRST PRODUCTION FROM THE MCLEAN LAKE JV

Earlier in July, the MLJV announced the successful start of uranium mining operations at the McClean North deposit using the JV's patented Surface Access Borehole Resource Extraction (SABRE) mining method. Mining operations began in June, with approximately 250 tonnes of high-grade ore estimated to have been recovered from the first mining cavity. The processing of recovered ore commenced at the McClean Lake mill in Q3/2025.

ROBUST ECONOMICS FROM THE MIDWEST PEA

The recently released PEA for the Midwest Main deposit envisages a ~6 year LOM operation producing 37.4M lbs U3O8 in total (100% basis). With processing taking place at the nearby McLean Lake mill, a base case after-tax NPV8% of $965M was estimated, along with an after-tax IRR of 82.7% (using a LT uranium price of $80 per lb which is 11% higher than the spot). The project is estimated to have a relatively low average cash costs of $11.69 per lb and an average AISC of $25.78 per lb. Due to the utilization of an ISR mining approach and planned ore processing at the nearby McClean Lake mill, project capex is relatively light at an estimated $254M.

Our projections for Gryphon and Phoenix remain as illustrated below. We add some production output from the MLJV (Denison's share being 22.5%) into our projections until 2030.

Denison maintains a strong current balance sheet with C$54.5M cash and equivalents in treasury, minimal LT debt and 2.2M lbs U3O8 held in inventory. This solid financial position sets up well when it comes to funding the construction work needed at Wheeler River.

Using a LT uranium price of $80/lb, we increase our targeted NAV multiple from 1.20x to 1.30x given all the recent project developments. As such, our 12-month price objective increases to C$3.60 per share. Our price objective equates to upside of +23% from the most recent close on August 8. Shares of Denison Mines currently trade at a 1.06x P/NAV multiple.