Denison Provides U.S. Operations Update

Denison Provides U.S. Operations Update

Friday, August 1st 2008

Denison has experienced delays in obtaining an Air Quality Permit, the only remaining permit required to mine Arizona 1, from the Arizona Department of Environmental Quality (“ADEQ”). The application for the Air Quality Permit, which relates to surface air quality, was submitted to the ADEQ in January 2008 after three months of consultation. Concern was subsequently raised over dust emission on public roads from the trucks hauling ore from the mine and further information was provided. The ADEQ staff was very timely in its response and indicated in June that all necessary information had been provided and finalizing the Air Quality Permit should not take long. Recently however, further information and analysis have been requested, which will be provided to ADEQ over the next six weeks. Unfortunately, Denison is unable to determine whether this new information will be sufficient, or the length of time ADEQ will require to process this information, and ultimately issue the Air Quality Permit. As a result, the Company has adjusted its 2008 production forecast to exclude any ore production from Arizona 1, a reduction of 340,000 pounds from the earlier estimate of 2008 production.

Ore production from the five Colorado Plateau mines and the Tony M mine is meeting estimates. Production from Tony M at 300 tons per day continues to increase as historical mine development workings are dewatered and rehabilitated. On the Colorado Plateau production is currently at 400 tons per day, and the reopening of the Beaver Shaft is progressing on schedule with production anticipated in the fourth quarter of this year. Head grades have been slightly lower than planned. On the Colorado Plateau, the average head grade was originally estimated at 0.20% U(3)O(8) and 1.20% V(2)O(5). Based on production to date, head grades are averaging 0.18% U(3)O(8) and 1.05% V(2)O(5). At Tony M, average head grades are 0.15% U(3)O(8), compared to an estimated average of 0.20% U(3)O(8). Changes in mining procedures have been implemented to reduce dilution and improve the head grade.

As a result of the delay in the receipt of the Air Quality Permit, and the lower head grades, production in 2008 from U.S. operations is now expected to be 1.0 to 1.2 million pounds. Vanadium production from the Colorado Plateau mines is expected to be 2.9 to 3.2 million pounds.

The start-up of the White Mesa mill has gone very well with throughput currently at 1,500 tons per day and recoveries averaging above 90%. Lack of experienced personnel has been an issue, but the Mill has implemented a new shift rotation to improve training.

The decision has been made to add a parallel alternate feed circuit at the White Mesa mill to run in conjunction with the processing of conventional ore. The engineering for this circuit will be completed in the fourth quarter and start-up of the circuit is anticipated by mid-2009. There is currently about 175,000 pounds of U3O8 contained in alternate feed material on site and another 350,000 pounds is expected to be delivered over the remainder of the year. With ongoing expected shipments next year and beyond, production from alternate feed is expected to be 150,000 – 250,000 pounds of U(3)O(8) on an annualized basis.

Denison Mines Corp. is a premier intermediate uranium producer in North America, with mining assets in the Athabasca Basin region of Saskatchewan, Canada and the southwest United States including Colorado, Utah, and Arizona. The Company also has ownership interests in two of the four conventional uranium mills operating in North America today. The Company has a strong exploration and development portfolio with large land positions in the United States, Canada, Mongolia and Zambia.

Contacts: Denison Mines Corp. E. Peter Farmer

(416) 979-1991 ext. 231

Denison Mines Corp. Ron Hochstein

(604) 689-7842

Denison Mines Corp. James Anderson (416) 979-1991 ext. 372 (416) 979-5893 (FAX)


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