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« SK OptionTrader Closes Another Winning Trade | Main | Philip Williams: Uranium to Cross $100 Threshold in 2011 »
Saturday
Feb122011

Denison Mines Corporation 2011 Operating Plans

DNN Logo.JPG

Just in case you missed this announcement from Denison Mines Corporation (TSX:DML) (NYSE AMEX:DNN) they announced that its 2011 operating plan forecasts production of 1.2 million pounds U3O8 and 2.2 million pounds V2O5 from its operations in the United States. “The 2011 plan and budget is focused on the growth of the Company with the largest exploration program ever undertaken on our Wheeler River project, the recommencement of drilling on our Zambian project and the development of our second mine on the Arizona Strip” said Ron Hochstein, President and CEO of Denison. Unless otherwise stated all figures are in U.S. Dollars.

2011 Operating Plans
Production
Denison's uranium production is expected to total 1.2 million pounds of U3O8 from ore in stockpile and from the Beaver, Pandora and Arizona 1 mines and production from the alternate feed circuit at the White Mesa Mill in the United States. Vanadium production is projected to total approximately 2.2 million pounds of V2O5. The White Mesa mill is anticipated to continue processing conventional ore during most of 2011, except for scheduled maintenance shutdowns. Production of alternate feed material will continue throughout 2011. The cash cost of production is expected to average approximately $43.50 per pound of U3O8 net of vanadium credits, excluding sales royalties. The cash cost per pound reflects the impact of an increase of over 200% of the cost of sulphuric acid as compared to 2010. Capital expenditures on the mines and mill facilities are estimated at $9.7 million.

Sales

Uranium sales are forecast to be approximately 1.3 million pounds of U3O8 of which just over 500,000 pounds will be sold into long term contracts and the remainder will be sold on the spot market. Vanadium sales are projected to be 2.8 million pounds V2O5 in 2011.

2010 PRODUCTION AND SALES

Denison’s uranium production in 2010 was 1.4 million pounds U3O8 from its U.S. operations and its 22.5% share of production from the McClean Lake operation in the Athabasca basin in Canada.

Vanadium production totalled 2.3 million pounds V2O5 from its White Mesa mill in Utah.
Uranium sales in 2010 totalled 1.8 million pounds U3O8 at an average realized price of $47.67 per pound U3O8. Vanadium sales in 2010 sales were 2.4 million pounds V2O5 equivalent, at an average realized price of $6.33 per pound V2O5.

Denison Mines Corporation trades on the AMEX under the symbol of DNN and on the Toronto Stock Exchange as DML.

Market capitalization is $1.41 billion, average volume ranging from 2 -3 million shares traded, 52 week high $4.28, 52 week low $1.08, closed recently at $4.14.

So there you have it.



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Reader Comments (1)

It's hard to get excited about this company, at least for the next fiscal year.
1) They SOLD 1.8M lbs. in 2010, but this year SALES are projected to be 1.3M lbs. That's 500,000 lbs LESS.
2) Cost/lb. is projected to $43.50 NET of V2O5 credits. Since V2O5 production is 2.8M lbs x approx. $6.33/lb = $17,724,000; then actual cost of production of uranium is ($17.724M divided by 1.3M lbs U3O8) + 43.50)= $13.63 + $43.50 = $57.13/lb. U3O8.

Questions:
1) How does $57.13 compare to other producers?
2) What is the earnings per share projection?
3) Where is the value in this company at the present time?

February 13, 2011 | Unregistered CommenterRobert

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