Denison Mines Monetizes Ten Uranium Exploration Properties

Denison Mines (TSX: DML) has monetized a number of its uranium assets, entering into an option agreement with Foremost Clean Energy (CSE: FAT) for a total of ten uranium exploration assets.

Under the terms of the arrangement, Foremost will be able to acquire up to a 70% interest in the properties. Foremost is to act as the operator during the term of the option agreement, while Denison will support exploration with its expertise as Foremost transitions to focus on uranium.

The terms of the option agreement will see Denison take a 19.95% interest in Foremost, while David Cates, CEO of Denison, is to join the firms board of directors. Compensation will also consist of Foremost being required to spend up to $20 million in exploration on the properties.

“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,” commented Cates on the transaction.

The option arrangement is to consist of three phases, with the first phase consisting of the issuance of 1.4 million shares to Denison, the appointment of a technical director to Foremost, and the entrance of an investors rights agreement in order to gain an initial 20% interest in the exploration properties.

Under phase two, $2.0 million in cash or shares must be paid to Denison, in addition to $8.0 million in exploration spend over the course of three years. Phase three, which is also expected to take three years, will see a further $2.5 million in cash or shares paid, and $12.0 million in exploration expenditures.

If the option agreement fails to be seen through to the end, 51% ownership will revert to Denison on the properties.

Properties involved in the transaction include Murphy Lake South, hatchet Lake, Turkey Lake, Torwalt Lake, Marten, Wolverine, Epp Lake, Blackwing, GR and CLK.

Denison Mines last traded at $2.45 on the TSX.


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