Denison Mines has reported the results of a preliminary economic assessment (PEA) of its 60% owned Wheeler River uranium project on the eastern edge of the Athabasca basin in northern Saskatchewan. The project is a joint venture between Denison (60%), Cameco (30%), and JCU (Canada) Exploration (10%).

The Wheeler River property hosts two deposits—Phoenix and Gryphon—which would be developed sequentially for underground mining. The Gryphon deposit would produce 40.7 million lb of contained U3O8 over a seven-year mine life at a cash operating cost of $14.28/lb U3O8, followed by the Phoenix deposit, which would produce 64 million lb over a nine-year mine life at a cash operating cost of $22.15/lb.

Capital expenditures to develop the project are estimated at C$560 million.

Wheeler River ore would be processed at the McClean Lake mill 35 km south-southwest of the project. The mill is owned 70% by Areva Resources Canada, 22.5% by Denison and 7.5% by OURD Canada.

Denison plans to initiate a prefeasibility study and associated environmental studies of the Wheeler River project before year-end 2016. The current project timeline calls for preproduction activities to begin in 2021, with first production from the Gryphon deposit in 2025.