6-K

FORM 6-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

Date: March 26, 2009

Commission File Number: 001-33414

Denison Mines Corp.

(Translation of registrant’s name into English)

Atrium on Bay, 595 Bay Street, Suite 402, Toronto, Ontario M5G 2C2

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F o     Form 40-F þ

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o          No þ

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-                    

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Denison Mines Corp.
Date: March 26, 2009	/s/ Andre Desautels
	Andre Desautels
	Vice President, General Counsel & Corporate Secretary

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EXHIBIT INDEX

Exhibit Number		Description
	1.	Financial Statements for the years ending December 31, 2008 and 2007
	2.	Technical Report on The Mutanga Project dated March 19, 2009
	3.	Consent to filing of Technical Report
	4.	Press release dated March 23, 2009

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EX-1

Exhibit 1

Denison Mines Corp.

Financial Statements
for the years ending
December 31, 2008 and 2007

Responsibility for Financial Statements

The Company’s management is responsible for the integrity and fairness of presentation of these consolidated financial statements. The consolidated financial statements have been prepared by management, in accordance with Canadian generally accepted accounting principles for review by the Audit Committee and approval by the Board of Directors.

The preparation of financial statements requires the selection of appropriate accounting policies in accordance with generally accepted accounting principles and the use of estimates and judgments by management to present fairly and consistently the consolidated financial position of the Company. Estimates are necessary when transactions affecting the current period cannot be finalized with certainty until future information becomes available. In making certain material estimates, the Company’s management has relied on the judgement of independent specialists.

The Company’s management has developed and maintains a system of internal accounting controls to ensure, on a reasonable and cost-effective basis, that the financial information is timely reported and is accurate and reliable in all material respects and that the Company’s assets are appropriately accounted for and adequately safeguarded.

The consolidated financial statements have been audited by PricewaterhouseCoopers LLP, our independent auditors. Their report outlines the scope of their examination and expresses their opinions on the consolidated financial statements and internal control over financial reporting.

“E. Peter Farmer”	“James R. Anderson”
E. Peter Farmer	James R. Anderson
Chief Executive Officer	Executive Vice-President and
	Chief Financial Officer
March 18, 2009

Management’s Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting. Management conducted an evaluation of the effectiveness of internal control over financial reporting based on the Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that the Company’s internal control over financial reporting was effective as at December 31, 2008.

The effectiveness of the Company’s internal control over financial reporting as at December 31, 2008 has been audited by PricewaterhouseCoopers LLP, our independent auditors, as stated in their report which appears herein.

Changes to Internal Control over Financial Reporting

There has not been any change in the Company’s internal control over financial reporting that occurred during 2008 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Independent Auditors’ Report

To the Shareholders of Denison Mines Corp.

We have completed integrated audits of Denison Mine Corp’s 2008 and 2007 consolidated financial statements and of its internal control over financial reporting as at December 31, 2008. Our opinions, based on our audits, are presented below.

Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Denison Mines Corp. as at December 31, 2008 and 2007, and the related consolidated statements of operations and deficit, comprehensive income (loss) and cash flows for each of the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits of the Company’s financial statements in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. A financial statement audit also includes assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as at December 31, 2008 and 2007 and the results of its operations and its cash flows for each of the years then ended, in accordance with Canadian generally accepted accounting principles.

Internal Control over Financial Reporting

We have also audited Denison Mines Corp.’s internal control over financial reporting as at December 31, 2008, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit of internal control over financial reporting in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. An audit of internal control over financial reporting includes obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we consider necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

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A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as at December 31, 2008 based on criteria established in Internal Control - Integrated Framework issued by the COSO.

“PricewaterhouseCoopers LLP”

Chartered Accountants, Licensed Public Accountants
Toronto, Ontario
March 18, 2009

Comments by Auditors for US Readers on Canada — US Reporting Differences

In the United States, reporting standards for auditors require the addition of an explanatory paragraph (following the opinion paragraph) when the consolidated financial statements are affected by conditions and events that cast substantial doubt on the Company’s ability to continue as a going concern, such as those described in Note 1 to these consolidated financial statements. Our report to the shareholders dated March 18, 2009 is expressed in accordance with Canadian reporting standards which do not permit a reference to such events and conditions in the Auditors’ report when these are adequately disclosed in the consolidated financial statements.

“PricewaterhouseCoopers LLP”

Chartered Accountants, Licensed Public Accountants
Toronto, Ontario
March 18, 2009

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DENISON MINES CORP.
Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)

	December 31,			December 31,
	2008			2007
ASSETS
Current
Cash and equivalents	$	3,206		$	19,680
Trade and other receivables		12,894			39,667
Note receivables		181			455
Inventories (Note 5)		44,733			30,921
Investments (Note 6)		—			13,930
Prepaid expenses and other		1,275			1,492
		62,289			106,145
Inventories — ore in stockpiles (Note 5)		5,016			—
Investments (Note 6)		10,691			20,507
Property, plant and equipment, net (Note 7)		717,433			727,823
Restricted cash and equivalents (Note 8)		21,286			17,797
Intangibles (Note 9)		4,978			6,979
Goodwill (Note 10)		63,240			122,330
	$	884,933		$	1,001,581
LIABILITIES
Current
Accounts payable and accrued liabilities	$	23,787		$	22,642
Current portion of long-term liabilities:
Post-employment benefits (Note 11)		329			404
Reclamation and remediation obligations (Note 12)		875			565
Debt obligations (Note 13)		464			42
Other long-term liabilities (Note 14)		2,179			6,577
		27,634			30,230
Deferred revenue		2,913			2,359
Provision for post-employment benefits (Note 11)		3,028			4,030
Reclamation and remediation obligations (Note 12)		18,471			19,824
Debt obligations (Note 13)		99,290			—
Other long-term liabilities (Note 14)		1,191			7,343
Future income tax liability (Note 15)		124,054			141,525
		276,581			205,311
SHAREHOLDERS’ EQUITY
Share capital (Note 16)		666,278			662,949
Share purchase warrants (Note 17)		11,728			11,728
Contributed surplus (Notes 18 and 19)		30,537			25,471
Deficit		(95,482	)		(14,834	)
Accumulated other comprehensive income (loss) (Note 20)		(4,709	)		110,956
		(100,191	)		96,122
		608,352			796,270
	$	884,933		$	1,001,581
Issued and outstanding common shares (Note 16)		197,295,415			189,731,635

Going concern basis of accounting (Note 1)
Contingent liabilities and commitments (Note 27)

On Behalf of the Board of Directors:

“E. Peter Farmer”   Director “Catherine J. G. Stefan”   Director

See accompanying notes to the consolidated financial statements

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DENISON MINES CORP.
Consolidated Statements of Operations and Deficit and Comprehensive Income (Loss)
(Expressed in thousands of U.S. dollars except for per share amounts)

	Year Ended			Year Ended
	December 31,			December 31,
	2008			2007
REVENUES (Note 22)	$	123,184		$	76,764
EXPENSES
Operating expenses		118,069			47,038
Sales royalties and capital taxes		3,117			2,301
Mineral property exploration		20,114			20,727
General and administrative		14,754			12,323
Stock option expense (Note 19)		6,062			1,382
Goodwill impairment (Note 10)		36,512			—
		198,628			83,771
Loss from operations		(75,444	)		(7,007	)
Other income, net (Note 21)		2,468			41,627
Income (loss) before taxes		(72,976	)		34,620
Income tax recovery (expense) (Note 15):
Current		899			(3,141	)
Future		(8,571	)		15,765
Net income (loss) for the year	$	(80,648	)	$	47,244
Deficit, beginning of year	$	(14,834	)	$	(62,078	)
Deficit, end of year	$	(95,482	)	$	(14,834	)
Net income (loss) for the year	$	(80,648	)	$	47,244
Change in unrealized gain (loss) on investments		(17,884	)		(6,742	)
Change in foreign currency translation		(97,781	)		101,354
Comprehensive income (loss) for the year	$	(196,313	)	$	141,856
Net income (loss) per share
Basic	$	(0.42	)	$	0.25
Diluted	$	(0.42	)	$	0.24
Weighted-average number of shares outstanding (in thousands)
Basic		190,218			188,722
Diluted		190,218			193,613

Going concern basis of accounting (Note 1)

See accompanying notes to the consolidated financial statements

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DENISON MINES CORP.
Consolidated Statements of Cash Flows
(Expressed in thousands of U.S. dollars)

	Year Ended			Year Ended
	December 31,			December 31,
CASH PROVIDED BY (USED IN):	2008			2007
OPERATING ACTIVITIES
Net income (loss) for the year	$	(80,648	)	$	47,244
Items not affecting cash:
Depletion, depreciation, amortization and accretion		39,588			13,386
Goodwill impairment charge		36,512			—
Investment impairment charge		12,952			—
Stock-based compensation		6,062			1,382
Losses (gains) on asset disposals		(181	)		(45,119	)
Losses (gains) on restricted investments		(1,176	)		(327	)
Write-downs and other non-cash		9,748			2,425
Change in future income taxes		8,571			(15,765	)
Foreign exchange		(15,544	)		—
Net change in non-cash working capital items (Note 25)		(24,648	)		(26,310	)
Net cash used in operating activities		(8,764	)		(23,084	)
INVESTING ACTIVITIES
Acquisition of businesses, net of cash and equivalents acquired (Note 4)		—			(158,583	)
Decrease in notes receivable		274			9,778
Purchase of long-term investments		(13,376	)		(1,458	)
Proceeds from sale of long-term investments		1,316			52,870
Expenditures on property, plant and equipment		(101,227	)		(59,578	)
Proceeds from sale of property, plant and equipment		4			33
Increase in restricted investments		(2,697	)		(1,531	)
Net cash used in investing activities		(115,706	)		(158,469	)
FINANCING ACTIVITIES
Increase (decrease) in debt obligations		99,547			(50	)
Issuance of common shares for cash:
New share issues		6,073			102,151
Exercise of stock options and warrants		1,527			5,114
Net cash provided by financing activities		107,147			107,215
Net decrease in cash and equivalents		(17,323	)		(74,338	)
Foreign exchange effect on cash and equivalents		849			24,891
Cash and equivalents, beginning of year		19,680			69,127
Cash and equivalents, end of year	$	3,206		$	19,680
Cash and cash equivalents comprised of:
Cash		3,206			9,437
Cash equivalents		—			10,243
	$	3,206		$	19,680
Supplemental cash flow disclosure:
Interest paid		2,514			23
Income taxes paid		1,811			—

See accompanying notes to the consolidated financial statements

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DENISON MINES CORP.
Notes to the Consolidated Financial Statements
(Expressed in U.S. dollars, unless otherwise noted)

1.	GOING CONCERN BASIS OF ACCOUNTING
	As a result of current economic conditions, prices and demand for our commodities may remain depressed for a prolonged period of time which may cause the Company to fully utilize its available credit facilities within the next twelve months and be in non-compliance with certain of its financial covenants. In particular, the net total debt to EBITDA (earnings before interest, tax, depreciation and amortization) ratio, as defined in the Company’s credit agreement, may not be met at December 31, 2009.
	The Company is addressing the near term liquidity requirements by taking a number of steps to reduce the borrowing requirements including the temporary closure of negative cash flow operations, the deferral of exploration and development expenditures and the reduction of the Company’s workforce.
	In addition the Company is pursuing the sale of certain of its interests in assets and investigating alternate debt or equity financing that will allow the Company to meet its obligations in the normal course of business. There are no assurances that additional financing will be raised and in the event that the Company sells an asset or assets that the price obtained will support the amounts reflected in these financial statements. The impact of any adjustments arising from the sale of an asset or assets, which could be material, is not reflected in these financial statements.
	Until the outcome of the above matters is known there is considerable uncertainty about the appropriateness of the going concern basis of accounting.
	The accounting principles used in these consolidated financial statements are applicable to a going concern which contemplates the realization of assets and settlement of liabilities in the normal course of business as they come due. These financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary if the Company were unable to realize its assets and settle its liabilities as a going concern in the normal course of operations. Such adjustments could be material.
2.	NATURE OF OPERATIONS
	Denison Mines Corp. (“DMC”) is incorporated under the Business Corporations Act (Ontario) (“OBCA”). Denison Mines Corp. and its subsidiary companies and joint ventures (collectively, the “Company”) are engaged in uranium mining and related activities, including acquisition, exploration and development of uranium bearing properties, extraction, processing, selling and reclamation. The environmental services division of the Company provides mine decommissioning and decommissioned site monitoring services for third parties.
	The Company has a 100% interest in the White Mesa mill located in Utah, United States and a 22.5% interest in the McClean Lake mill located in the Athabasca Basin of Saskatchewan, Canada. The Company has interests in a number of nearby mines at both locations, as well as interests in development and exploration projects located in Canada, the United States, Mongolia and Zambia, some of which are operated through joint ventures and joint arrangements. Uranium, the Company’s primary product, is produced in the form of uranium oxide concentrates (“U3O8”) and sold to various customers around the world for further processing. Vanadium, a co-product of some of the Company’s mines is also produced and is in the form of vanadium pentoxide, or V2O5. The Company is also in the business of recycling uranium bearing waste materials, referred to as “alternate feed materials”.
	Denison Mines Inc. (“DMI”), a subsidiary of the Company, is the manager of Uranium Participation Corporation (“UPC”), a publicly-listed investment holding company formed to invest substantially all of its assets in U3O8 and uranium hexafluoride (“UF6”). The Company has no ownership interest in UPC but receives various fees for management services and commissions from the purchase and sale of U3O8 and UF6 by UPC.
	References to “2008” and “2007” refer to the year ended December 31, 2008 and the year ended December 31, 2007 respectively.

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3.	SUMMARY OF SIGNIFICANT MINING INTERESTS AND ACCOUNTING POLICIES
	Basis of Presentation
	These consolidated financial statements have been prepared by management in U.S. dollars, unless otherwise stated, in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”). All adjustments considered necessary by management for fair presentation have been included in these financial statements. Differences between Canadian GAAP and those generally accepted accounting principles and practices in the United States (“U.S. GAAP”) that would have a significant impact on these financial statements are disclosed in Note 29.
	Significant Mining Interests
	The following table sets forth the Company’s ownership of its significant mining interests that have projects at the development stage within them as at December 31, 2008:

		Ownership
	Location	Interest
Through majority owned subsidiaries
Arizona Strip	USA		100.00	%
Henry Mountains	USA		100.00	%
Colorado Plateau	USA		100.00	%
Gurvan Saihan Joint Venture	Mongolia		70.00	%
Mutanga	Zambia		100.00	%
As interests in unincorporated joint ventures, or jointly controlled assets
McClean Lake Joint Venture	Canada		22.50	%
Midwest Joint Venture	Canada		25.17	%

Significant Accounting Policies

The principal accounting policies and practices under Canadian GAAP followed by the Company in the preparation of these financial statements are summarized below:

a) Principles of Consolidation

These consolidated financial statements include the accounts of DMC, its subsidiaries and its share of assets, liabilities, revenues and expenses of jointly-controlled companies and unincorporated ventures proportionate to the Company’s percentage ownership or participating interest. All significant intercompany balances and transactions have been eliminated on consolidation.

The companies and ventures controlled by DMC are consolidated using the full consolidation method. Control is defined as the direct or indirect power to govern a company’s financing, investing and strategic operating policies without co-operation of others in order to benefit from its activities.

The companies and ventures jointly controlled by DMC are consolidated using the proportionate consolidation method. Joint control is deemed to exist when agreements exist that require that material changes to the operating, investing and financing policies of such company or venture be approved by a percentage of the participating interest sufficiently high enough to prevent any one participant from exercising unilateral control.

The companies and ventures in which DMC exercises significant influence over financial policy and management (“associates”) are accounted for using the equity method. In determining whether significant influence exists, the Company evaluates a number of criteria including the percentage of voting interest held, and representation on the board of directors or in senior management.

Variable Interest Entities (“VIEs”) (which include, but are not limited to, special purpose entities, trusts, partnerships and other legal structures) are consolidated by the Company if it is the primary beneficiary who will absorb the majority of the entities expected losses and / or expected residual returns.

b) Use of Estimates

The presentation of consolidated financial statements in conformity with Canadian GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported in these financial statements and related note disclosures. Although the Company regularly reviews the estimates and assumptions that affect these financial statements, actual results may be materially different. Significant estimates and assumptions made by management relate to the quantities and net realizable value of inventories, assumptions used in impairment testing and valuation of long-lived assets, determination of reporting units and the valuation of reporting units for goodwill determination, determination of economic lives, recoverability of and reclamation obligations for property, plant and equipment and the evaluation of post-employment benefits, future income taxes, contingent liabilities and stock-based compensation.

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c) Foreign Currency Translation

The Company’s currency of measurement for its Canadian operations is the Canadian dollar. As the Company’s reporting currency is the U.S. dollar, the Company applies the current rate method for translation of the Company’s net investment in its self sustaining Canadian operations. Assets and liabilities denominated in currencies other than the U.S. dollar are translated at the exchange rate in effect at the balance sheet date. Revenues and expenses denominated in currencies other than the U.S. dollar are translated at the average rate in effect during the period. Foreign currency translation gains and losses are recorded in accumulated other comprehensive income which will be recognized in the results of operations upon the dilution or other reduction in equity of the net investment.

The Company’s fully integrated subsidiaries are translated into US dollars using the temporal method. Under this method, monetary assets and liabilities are translated at the year-end exchange rate and all other assets and liabilities are translated at applicable historical exchange rates. Revenue and expense items are translated at the rate of exchange in effect at the date the transactions are recognized in income. Realized exchange gains and losses and currency translation adjustments are included in the results of operations. Foreign currency transactions are translated using the exchange rates prevailing at the rate of exchange in effect at the date the transactions are recognized in income. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are included in the results of operations.

d) Income Taxes

Income taxes are accounted for using the liability method of accounting for future income taxes. Under this method, current income taxes are recognized for the estimated income taxes payable for the current period. Future income tax assets and liabilities are recognized based on temporary differences between the financial statement carrying values of the existing assets and liabilities and their respective income tax bases using enacted or substantively enacted tax rates expected to apply to taxable income during the years in which the differences are expected to be recovered or settled. The recognition of future income tax assets such as tax losses available for carry forward are limited to the amount that is “more likely than not” to be realized.

e) Flow-Through Common Shares

The Company’s Canadian exploration activities have been financed in part through the issuance of flow-through common shares whereby the tax benefits of the eligible exploration expenditures incurred under this arrangement are renounced to the subscribers. In accordance with Emerging Issues Committee (“EIC”) Abstract No. 146: Flow-Through Shares applicable for flow-through financings initiated after March 19, 2004, the foregone tax benefits to the Company are recognized by reducing the proceeds received from these financings by the tax effects of the renunciation to the subscribers at the time of renunciation by the Company.

f) Cash and Equivalents

Cash and equivalents consist of cash on deposit and highly-liquid, short-term money market instruments which, on acquisition, have terms to maturity of three months or less. Cash and equivalents which are subject to restrictions that prevent its use for current purposes are classified as restricted cash and equivalents.

g) Inventories

The Company applies CICA Handbook Section 3031: Inventories which provides guidance on the determination of cost and the cost formulas that are used to assign costs to inventories.

Expenditures, including depreciation, depletion and amortization of assets, incurred in the mining and processing activities that will result in future concentrate production are deferred and accumulated as ore in stockpiles and in-process and concentrate inventories. These amounts are carried at the lower of average cost or net realizable value (“NRV”). NRV is the difference between the estimated future concentrate price (net of selling costs) and estimated costs to complete production into a saleable form.

Stockpiles are comprised of coarse ore that has been extracted from the mine and is available for further processing. Mining production costs are added to the stockpile as incurred (including overburden removal and in-pit stripping costs) and removed from the stockpile based upon the average cost per ton or tonne of ore produced from mines considered to be in commercial production. The current portion of ore in stockpiles represents the amount expected to be processed in the next twelve months.

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In-process and concentrate inventories include the cost of the ore removed from the stockpile, a pro-rata share of the amortization of the associated mineral property, as well as production costs incurred to process the ore into a saleable product. Processing costs typically include labor, chemical reagents and certain mill overhead expenditures. Items are valued according to the first-in first-out method (FIFO) or at weighted average cost, depending on the type of inventory or work-in-process.

Mine and mill supplies are valued at the lower of average cost and net realizable value as measured by replacement cost.

h) Investments

Equity investments over which the Company does not exercise significant influence are accounted for as available for sale securities.

Investments in affiliates over which the Company exercises significant influence are accounted for using the equity method, whereby the investment is initially recorded at cost and adjusted to recognize the Company’s share of earnings or losses, reduced by dividends and distributions received.

i) Property, Plant and Equipment

Plant and equipment

Property, plant and equipment are recorded at acquisition or production cost and carried net of depreciation. Depreciation is calculated on a straight line or unit of production basis as appropriate. Where a straight line methodology is used, the assets are depreciated to their estimated residual value over an estimated useful life which ranges from three to fifteen years depending upon the asset type. Where a unit of production methodology is used, the assets are depreciated to their estimated residual value over the useful life defined by management’s best estimate of recoverable reserves and resources in the current mine plan. When assets are retired or sold, the resulting gains or losses are reflected in current earnings as a component of other income or expense.

Mineral Property Acquisition, Exploration and Development Costs

Mineral property costs include acquisition costs relating to acquired mineral use and exploration rights and are capitalized.

Exploration and development expenditures are expensed as incurred on mineral properties not sufficiently advanced as to identify their development potential. At the point in time that a mineral property is considered to be sufficiently advanced and development potential is identified, all further expenditures for the current year and subsequent years are capitalized as incurred. These costs will include further exploration, costs of maintaining the site until commercial production, costs to initially delineate the ore body, costs for shaft sinking and access, lateral development, drift development and infrastructure development. Such costs represent the net expenditures incurred and capitalized as at the balance sheet date and do not necessarily reflect present or future values.

Once a development mineral property goes into commercial production, the property is classified as “Producing” and the accumulated costs are amortized over the estimated recoverable resources in the current mine plan using a unit of production basis. Commercial production occurs when a property is substantially complete and ready for its intended use.

Impairment of Long-Lived Assets

The Company applies CICA Handbook Section 3063: Impairment of Long-Lived Assets which provides standards for the recognition, measurement and disclosure of impairment of long-lived assets including property, plant and equipment.

Long-lived assets are assessed by management for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. The amount of the impairment loss is determined as the excess of the carrying value of the asset over its fair value and is charged to the results of operations. Fair value represents future discounted cash flows from an area of interest, including estimates of selling price and costs to develop and extract the mining assets.

j) Asset Retirement Obligations

The Company applies CICA Handbook Section 3110: Asset Retirement Obligations which provides standards for the recognition, measurement and disclosure of liabilities for asset retirement obligations and the associated asset retirement costs.

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Asset retirement obligations, any statutory, contractual or other legal obligation related to the retirement of tangible long-lived assets, are recognized when such obligations are incurred, if a reasonable estimate of fair value can be determined. These obligations are measured initially at fair value and the resulting costs are capitalized and added to the carrying value of the related assets. In subsequent periods, the liability is adjusted for the accretion of the discount and the expense is recorded in the income statement. Changes in the amount or timing of the underlying future cash flows are immediately recognized as an increase or decrease in the carrying amounts of the liability and related assets. These costs are amortized to the results of operations over the life of the asset.

The Company’s activities are subject to numerous governmental laws and regulations. Estimates of future reclamation liabilities for asset decommissioning and site restoration are recognized in the period when such liabilities are incurred. These estimates are updated on a periodic basis and are subject to changing laws, regulatory requirements, changing technology and other factors which will be recognized when appropriate. Liabilities related to site restoration include long-term treatment and monitoring costs and incorporate total expected costs net of recoveries. Expenditures incurred to dismantle facilities, restore and monitor closed resource properties are charged against the related reclamation and remediation liability.

k) Goodwill and Other Intangibles

Business combinations are accounted for under the purchase method of accounting whereby acquired assets and liabilities are recorded at fair value as of the date of acquisition. The excess of the purchase price over the fair value is recorded as goodwill and allocated to the applicable reporting unit. Goodwill is tested annually for impairment or more frequently if current events or changes in circumstances indicate that the carrying value of the goodwill of a reporting unit may exceed its fair value. A two-step impairment test is used to identify potential impairment in goodwill and to measure the amount of goodwill impairment, if any. In the first step, the fair value of a reporting unit is compared with its carrying value, including goodwill. When the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not to be impaired and the second step of the impairment test is not undertaken. When the carrying amount of a reporting unit exceeds its fair value, the fair value of the reporting unit’s goodwill (determined on the same basis as the value of goodwill is determined in a business combination) is compared with its carrying amount to measure the amount of the impairment loss, if any. When the carrying amount of reporting unit goodwill exceeds the fair value of the goodwill, an impairment loss is recognized in an amount equal to the excess.

l) Post-Employment Benefits

The Company assumed the obligation of a predecessor company to provide life insurance, supplemental health care and dental benefits, excluding pensions, to its former Canadian employees who retired on immediate pension from active service prior to 1997. The estimated cost of providing these benefits was actuarially determined using the projected benefits method and is recorded on the balance sheet at its estimated present value. The interest cost on this unfunded liability is being accreted over the remaining lives of this retiree group.

m) Revenue Recognition

Revenue from the sale of uranium concentrate to customers is recognized when title to the product passes to the customer, delivery is effected by book transfer and price is reasonably determinable.

Revenue from alternate feed process milling is recognized as material is processed, in accordance with the specifics of the applicable processing agreement. In general, the Company collects a recycling fee for receipt of the material and/or receives the proceeds from the sale of any uranium concentrate and other metals produced. Deferred revenues represent processing proceeds received on delivery of materials but in advance of the required processing activity.

Revenue on decommissioning contracts is recognized using the percentage of completion method, whereby sales, earnings and unbilled accounts receivable are recorded as related costs are incurred. Earnings rates are adjusted periodically as a result of revisions to projected contract revenues and estimated costs of completion. Losses, if any, are recognized fully when first anticipated. Revenues from engineering services are recognized as the services are provided in accordance with customer agreements.

Management fees earned from UPC are recognized as earned on a monthly basis. Commission revenue earned on acquisition or sale of U₃O₈ and UF₆ on behalf of UPC is recognized on the date when title passes to UPC.

Revenues are recognized only to the extent they are reasonably considered to be collectible.

n) Stock-Based Compensation

CICA Handbook Section 3870: Stock-Based Compensation and Other Stock-Based Payments (“Section 3870”) establishes standards for the recognition, measurement and disclosure of stock-based compensation and other stock-based payments made in exchange for goods and services.

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Section 3870 requires a fair value-based method of accounting for stock options granted to employees, including directors, and to non-employees. The fair value of stock options granted is recognized on a straight-line basis over the applicable vesting period as an increase in stock-based compensation expense and the contributed surplus account. When such stock options are exercised, the proceeds received by the Company, together with the respective amount from contributed surplus, are credited to share capital.

o) Earnings (Loss) per Share

Basic earnings (loss) per share is computed by dividing net income (loss) for the period by the weighted-average number of common shares outstanding for the period. The Company follows the “treasury stock” method in the calculation of diluted earnings per share. Under this method, the calculation of diluted earnings per share assumes that the proceeds to be received from the exercise of “in the money” stock options and warrants are applied to repurchase common shares at the average market price for the period. The calculation of diluted loss per share does not meet this assumption as the result would be anti-dilutive.

p) Financial Instruments — Recognition and Measurement / Presentation and Disclosure

Financial assets and financial liabilities are recognized on the Consolidated Balance Sheet when the Company becomes a party to the contractual provisions of the financial instrument. All financial instruments are required to be measured at fair value on initial recognition except for certain financial instruments that arise in related party transactions. Measurement in subsequent periods is dependent upon the classification of the financial instrument as held-for-trading, available-for-sale, loans and receivables, held-to-maturity, or other financial liabilities. The held-for-trading classification is applied when an entity is “trading” in an instrument or alternatively the standard permits that any financial instrument be irrevocably designated as held-for-trading. For financial instruments classified as other than held-for-trading, transaction costs are added to the initial fair value of the related financial instrument.

Financial assets and financial liabilities classified as held-for-trading are measured at fair value with changes in those fair values recognized on the Consolidated Statement of Operations and Deficit. Financial assets classified as available-for-sale are measured at fair value with changes in those fair values recognized in other comprehensive income. Financial assets classified as loans and receivables, held to maturity or other financial liabilities are measured at amortized cost using the effective interest rate method of amortization. Where a financial asset classified as held-to-maturity or available-for-sale has a loss in value which is considered to be other than temporary, the loss is recognized in the results of operations.

For financial instruments measured at amortized cost, transaction costs or fees, premiums or discounts earned or incurred are recorded, at inception, net against the fair value of the financial instrument. Interest expense is recorded using the effective interest method.

The Company has implemented the following classifications:

• Cash and equivalents are classified as held-for-trading and any period change in fair value is recorded through the results from operations.

• Trade and other receivables and Notes receivable are classified as loans and receivables and are measured at amortized cost using the effective interest rate method. Interest income is recorded in net income, as applicable.

• Investments are classified as available-for-sale and any period change in fair value is recorded through other comprehensive income. Where the investment experiences an other-than temporary decline in value, the loss is recognized in the results of operations.

• Accounts payable and accrued liabilities and Debt obligations are classified as other financial liabilities and are measured at amortized cost using the effective interest rate method. Interest expense is recorded in other income, as applicable.

New Accounting Standards Adopted

The Company adopted the following new accounting standards issued by the CICA Handbook effective January 1, 2008:

a) CICA Handbook Section 1400 “General Standards of Financial Statement Presentation” which was amended to include a requirement that management make an assessment of an entity’s ability to continue as a going concern when preparing financial statements.

b) CICA Handbook Section 3031 “Inventories” which provides guidance on the determination of cost and its subsequent recognition as an expense, including any write-down to net realizable value. It also provides guidance on the cost formulas that are used to assign costs to inventories. There was no impact to the Company’s financial results from adopting this standard.

c) CICA Handbook Section 3862 “Financial Instruments — Disclosures” and Section 3863 “Financial Instruments — Presentation” which requires disclosures in the financial statements that will enable users to evaluate: the significance of financial instruments for the company’s financial positions and performance; the nature and extent of risks arising from financial instruments to which the company is exposed during the period and at the balance sheet date; and how the company manages those risks (see note 26).

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d) CICA Handbook Section 1535 “Capital Disclosures” which requires the disclosure of both qualitative and quantitative information that enable users to evaluate the company’s objectives, policies and processes for managing capital (see note 26).

Accounting Standards Issued but not yet Adopted

The CICA has issued the following accounting standards effective for the fiscal years beginning on or after January 1, 2009:

a) CICA Handbook Section 3064 “Goodwill and intangible assets” provides guidance on the recognition, measurement, presentation and disclosure for goodwill and intangible assets, other than the initial recognition of goodwill or intangible assets acquired in a business combination. This standard is effective for fiscal years beginning on or after October 1, 2008 and requires retroactive application to prior period financial statements. The Company has evaluated the impact of this new standard for adoption on January 1, 2009 and does not expect any significant impact on its consolidated financial statements.

b) CICA Handbook Section 1582 “Business Combinations”, Section 1601 “Consolidated Financial Statements” and Section 1602 “Non-Controlling Interests” which replace the former CICA 1581 “Business Combinations” and CICA 1600 “Consolidated Financial Statements” and establish a new section for accounting for a non-controlling interest in a subsidiary. These sections provide the Canadian equivalent to FASB Statements No.141(R) “Business Combinations” and No.160 “Non-Controlling Interests in Consolidated Financial Statements”. CICA 1582 is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period after January 1, 2011. CICA 1601 and CICA 1602 apply to interim and annual consolidated financial statements relating to years beginning on or after January 1, 2011 although early adoption is permitted. CICA 1582, which replaces Handbook Section 1581, Business Combinations, establishes standards for the measurement of a business combination and the recognition and measurement of assets acquired and liabilities assumed. CICA 1601, which replaces Handbook Section 1600, carries forward the existing Canadian guidance on aspects of the preparation of consolidated financial statements subsequent to acquisition other than non-controlling interests. CICA 1602 establishes guidance for the treatment of non-controlling interests subsequent to acquisition through a business combination.

c) Emerging Issues Committee Abstract 173 “Credit risk and the fair value of financial assets and financial liabilities requires the Company to consider its own credit risk and the credit risk of the counterparty when determining the fair value of financial assets and financial liabilities, including derivative instruments. EIC 173 is effective for years beginning after January 1, 2010.

Comparative Numbers

Certain classifications of the comparative figures have been changed to conform to those used in the current period.

4.	ACQUISITIONS
	Acquisition of OmegaCorp Limited (“OmegaCorp”)
	Effective August 1, 2007, the Company acquired 100% of the common shares of OmegaCorp, an exploration and development company. The cost of this investment, which was settled in cash, was $167,204,000.

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The allocation of the purchase price for OmegaCorp is summarized below.

	OmegaCorp
	Fair Value
	August 1,
(in thousands)	2007
Cash and equivalents	$	8,621
Trade and other receivables		243
Long-term investments		3,022
Property, plant and equipment
Plant and equipment		199
Mineral properties		208,088
Total assets		220,173
Accounts payable and accrued liabilities		947
Future income tax liability		52,022
Total liabilities		52,969
Net assets purchased	$	167,204

OmegaCorp’s assets and liabilities were measured at their individual fair values as of August 1, 2007. The majority of the fair value has been allocated to the Mutanga project mineral property resources included in the property, plant and equipment value above. In arriving at these fair values, management has made assumptions, estimates and assessments at the time these fair values were prepared. The future income tax liability as a result of these fair value adjustments has been estimated based on the statutory income tax rate that was in effect at the time of the acquisition. In Zambia, the income tax rate used in the estimate was 25%.

In 2008, the Zambian government enacted legislation increasing the income tax rate for mining companies from 25% to 30%. The impact of this change on OmegaCorp’s future tax liability has been recorded in the statement of operations.

5.	INVENTORIES
	The inventories balance consists of:

	December 31,		December 31,
(in thousands)	2008		2007
Uranium concentrates and work-in-progress	$	12,378	$	8,344
Vanadium concentrates and work-in-progress		4,445		—
Inventory of ore in stockpiles		26,841		19,289
Mine and mill supplies		6,085		3,288
	$	49,749	$	30,921
Inventories:
Current	$	44,733	$	30,921
Long-term — ore in stockpiles		5,016		—
	$	49,749	$	30,921

Long-term ore in stockpile inventory represents an estimate of the amount of pounds on the stockpile in excess of the next twelve months of planned mill production. Operating expenses are predominantly cost of sales and include a write down of $9,500,000 relating to the net realizable value of the Company’s vanadium inventory.

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6.	INVESTMENTS
	The investments balance consists of:

	December 31,		December 31,
(in thousands)	2008		2007
Investments
Available for sale securities at fair value (1)	$	10,691	$	34,437
	$	10,691	$	34,437
Investments:
Current		—		13,930
Long-term		10,691		20,507
	$	10,691	$	34,437

(1) For accounting purposes, effective January 1, 2007, investments are carried at fair value on the balance sheet. The adjustments to fair value have been reflected in other comprehensive income net of tax.

Investments

At December 31, 2008, investments consist of equity instruments of six publicly-traded companies at a fair value of $10,691,000 (December 31, 2007: $34,437,000).

During 2008, the Company acquired additional equity interests in investments at a cost of $13,376,000 (2007: $1,458,000).

During 2008, the Company purchased 5,465,000 units of Uranerz Energy Corporation (“Uranerz”) for $13,329,000. Each unit is comprised of one common share and one-half of one common share purchase warrant. Each whole warrant entitles the holder to purchase one additional share of Uranerz for a period of 24 months (subject to acceleration under certain conditions) at an exercise price of US$3.50 per share.

Due to the significant decline in the market value of the Company’s investments during the fourth quarter of 2008, the Company has taken impairment charges of $7,602,000 on its investment in Uranerz and $5,350,000 on its investment in Energy Metals Limited (see Note 21).

During 2008, the Company sold equity interests in several public companies for cash consideration of $1,316,000. The resulting gain has been included in net other income in the statement of operations (see note 21).

During 2007, the Company sold 1,152,000 common shares of Energy Metals Corp (“EMC”) for cash consideration of approximately $17,447,000 (CDN$18,754,000). The resulting gain has been included in net other income in the statement of operations (see note 21). The Company no longer holds a common share interest in EMC.

Investments in affiliates

During 2007, the Company sold its remaining 30,598,750 common share interest of Fortress Minerals Corp. (“Fortress”) for cash consideration of approximately $35,413,000 (CDN$38,067,000). The resulting gain has been included in net other income in the statement of operations (see note 21).

The Company’s investment in Fortress has been subject to varying degrees of ownership interest. These financial statements include the accounts of Fortress Minerals Corp. on an equity method basis for the six month period up to June 30, 2007. The equity method was discontinued subsequent to June 30, 2007 and the appropriate portion of the cumulative equity accounting adjustments were recognized as part of the gain referred to above.

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7.	PROPERTY, PLANT AND EQUIPMENT
	Property, plant and equipment consist of:

	December 31,		December 31,
(in thousands)	2008		2007
Cost, net of write-downs
Plant and equipment
Mill and mining related	$	169,971	$	135,375
Environmental services and other		2,439		2,742
Mineral properties		590,758		609,569
		763,168		747,686
Accumulated depreciation and amortization
Plant and equipment
Mill and mining related		16,938		9,182
Environmental services and other		1,146		843
Mineral properties		27,651		9,838
		45,735		19,863
Property, plant and equipment, net	$	717,433	$	727,823
Net book value
Plant and equipment
Mill and mining related	$	153,033	$	126,193
Environmental services and other		1,293		1,899
Mineral properties		563,107		599,731
	$	717,433	$	727,823

The carrying values of the Company’s plant and equipment and mineral properties are tested for impairment when conditions warrant. In view of the current market volatility, the Company has reviewed all of its plant and equipment and mineral properties for impairment using long-term estimated prices and exchange rates. The Company will continue to monitor these assets for impairment.

Plant and Equipment — Mill and Mining Related

The Company has a 100% interest in the White Mesa mill located in Utah and mines located in Arizona, Colorado and Utah. Mined ore from these mines is processed at the White Mesa mill.

The Company has a 22.5% interest in the McClean Lake mill and mines located in the Athabasca Basin of Saskatchewan, Canada. The McClean Lake mill achieved commercial production levels on November 1, 1999 and has been constructed to process ore from the McClean Lake mine as well as other deposits in the area. A toll milling agreement has been signed with the participants in the Cigar Lake joint venture that provides for the processing of a substantial portion of the future output of the Cigar Lake mine at the McClean Lake mill, for which the owners of the McClean Lake mill will receive a toll milling fee and other benefits. In determining the amortization rate for the McClean Lake mill, the amount to be amortized has been adjusted to reflect Denison’s expected share of future toll milling revenue.

Plant and Equipment — Environmental Services and Other

The environmental services division of the Company provides mine decommissioning and decommissioned site monitoring services for third parties.

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Mineral Properties

The Company has various interests in development and exploration projects located in Canada, the U.S., Mongolia and Zambia which are held directly or through option or joint venture agreements. The most significant of these interests are as follows:

Canada

The Company has a 22.5% interest in the McClean Lake project and a 25.17% interest in the Midwest project located in the Athabasca Basin of Saskatchewan, Canada. These projects are in the development stage and were acquired by the Company in 2006, along with some other exploration projects, as part of the DMI acquisition.

Other significant mineral property interests that the Company has in Canada include:

a) Moore Lake — the Company has a 75% interest in the project (located in the Athabasca Basin) subject to a 2.5% net smelter return royalty;

b) Wheeler River — in October 2004, the Company entered into an option agreement with its joint venture partners to earn a further 20% ownership interest in the Wheeler project by funding CDN$7,000,000 in exploration expenditures over the next 6 years. During 2007, the Company fulfilled its obligations under the option agreement and increased its ownership interest in the project from 40% to 60%;

c) Wolly — In October 2004, the Company entered into an option agreement with its joint venture partners to earn a 22.5% ownership interest in the Wolly project by funding CDN$5,000,000 in exploration expenditures over the next six years. As at December 31, 2008, the Company has incurred a total of CDN$3,822,000 towards this option and has earned a 13.0% ownership interest in the project under the phase-in ownership provisions of the agreement; and

d) Park Creek — In the first quarter of 2006, the Company entered into an option agreement to earn up to a 75% interest in the Park Creek project. The Company is required to incur exploration expenditures of CDN$2,800,000 over three years to earn an initial 49% interest and a further CDN$3,000,000 over two years to earn an additional 26% interest. As at December 31, 2008, the Company has incurred a total of CDN$3,341,000 towards the option and has earned a 49% ownership interest in the project under the phase-in ownership provisions of the agreement.

United States

During 2008 and 2007, the Company commenced mining activities through the re-opening of some of its U.S. mines in Colorado, Utah and Arizona which had been shut down since 1999.

In March 2007, the Company acquired certain uranium deposits located in the Arizona Strip district in northeastern Arizona for cash consideration of $5,500,000 (excluding transaction costs) plus a 1% royalty.

In January 2007, the Company completed a mineral property acquisition in the Henry Mountains district by issuing an additional 103,000 shares at a value of $947,000 (see note 16).

Mongolia

The Company has a 70% interest in and is the managing partner of the Gurvan Saihan Joint Venture in Mongolia. The results of the Gurvan Saihan Joint Venture have been included in these financial statements on a consolidated basis since the Company exercises control.

Zambia

In August 2007, the Company acquired certain uranium deposits located in Zambia in conjunction with its purchase of OmegaCorp. The deposits, which are part of the Mutanga project, were acquired at a fair value of $208,088,000 (see note 4). The fair value amount includes $52,022,000 associated with the future tax liability at the time of the acquisition.

8.	RESTRICTED CASH AND EQUIVALENTS
	The Company has certain restricted cash and equivalents deposited to collateralize its reclamation and certain other obligations. The restricted cash and equivalents balance consists of:

	December 31,		December 31,
(in thousands)	2008		2007
U.S. mill and mine reclamation	$	19,745	$	15,849
Elliot Lake reclamation trust fund		1,541		1,948
	$	21,286	$	17,797

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U.S. Mill and Mine Reclamation

The Company has cash and cash equivalents and fixed income securities as collateral for various bonds posted in favour of the State of Utah and the applicable state regulatory agencies in Colorado and Arizona and the U.S, Bureau of Land Management for estimated reclamation costs associated with the White Mesa mill and U.S. mining properties. In 2008, the Company deposited an additional $2,123,000 into its collateral account (2007: $982,000).

Elliot Lake Reclamation Trust Fund

The Company has the obligation to maintain its decommissioned Elliot Lake uranium mine pursuant to a Reclamation Funding Agreement effective September 30, 1994 (“Agreement”) with the Governments of Canada and Ontario. The Agreement requires the Company to deposit 90% of cash flow, after deducting permitted expenses, into the Reclamation Trust Fund. A subsequent amendment to the Agreement provides for the suspension of this obligation to deposit 90% of cash flow into the Reclamation Trust Fund, provided funds are maintained in the Reclamation Trust Fund equal to estimated reclamation spending for the succeeding six calendar years, less interest expected to accrue on the funds during the period. Withdrawals from this Reclamation Trust Fund can only be made with the approval of the Governments of Canada and Ontario to fund Elliot Lake monitoring and site restoration costs. In 2008, the Company withdrew $603,000 (CDN$643,000) (2007: $468,900 (CDN$503,500)) and deposited an additional $497,000 (CDN$530,000) into the Elliot Lake Reclamation Trust Fund (2007: $514,000 (CDN$552,000)).

9.	INTANGIBLES
	A continuity summary of intangibles is presented below:

	December 31,			December 31,
(in thousands)	2008			2007
Intangibles, beginning of year	$	6,979		$	10,844
Fair value allocation adjustments		—			(4,279	)
Amortization		(900	)		(958	)
Foreign exchange		(1,101	)		1,372
Intangibles, end of year	$	4,978		$	6,979
Intangibles, by item:
UPC management contract		4,557			6,495
Urizon technology licenses		421			484
	$	4,978		$	6,979

UPC Management Contract

The UPC management contract is associated with the acquisition of DMI in 2006. The initial fair value of $10,481,000 was determined using a discounted cash flow approach after taking into account an appropriate discount rate. In 2007, the Company adjusted the fair value of the contract by $4,279,000 and adjusted the estimated useful life of the contract to 8 years. The contract is being amortized over its 8 year estimated useful life. The fair value adjustment (net of future tax effects) has been reclassified to goodwill.

Urizon Technology Licenses

The Company has a 50% interest in a joint venture with Nuclear Fuel Services, Inc. (“NFS”) (the “Urizon” joint venture) to pursue an alternate feed program for the White Mesa mill. NFS contributed its technology license to the joint venture while the Company contributed $1,500,000 in cash together with its technology license. The accounts of Urizon have been included in the Company’s consolidated financial statements on a proportionate consolidation basis. The joint venture has no cash flows arising from investing or financing activities.

This Urizon technology license is being amortized over an estimated useful life of 12 years and represents the Company’s 50% interest in Urizon’s technology licenses.

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10.	GOODWILL
	A continuity summary of goodwill is presented below:

	December 31,			December 31,
(in thousands)	2008			2007
Goodwill, beginning of year	$	122,330		$	102,841
Fair value allocation adjustments		—			1,314
Impairment charge		(36,512	)		—
Foreign exchange		(22,578	)		18,175
Goodwill, end of year	$	63,240		$	122,330
Goodwill, by business unit:
Canada mining segment	$	63,240		$	122,330

The Company’s acquisition of DMI was accounted for using the purchase method. The excess of the purchase price over the fair value of the net assets acquired has been recorded as goodwill. Under GAAP, goodwill is not amortized and is tested annually for impairment. The goodwill has been allocated to the Company’s Canadian mining segment.

In 2008, the Company experienced adverse economic conditions and depressed uranium and vanadium prices. Based on management’s revised outlook, the Company recorded an impairment charge of $36,512,000 representing the carrying value of the goodwill in excess of fair value. Fair value was determined by using estimated future net cash flows which included estimated recoverable reserves, future consensus prices, future foreign exchange rates and estimated operating and capital costs.

In 2007, the Company finalized the purchase price allocation associated with its acquisition of DMI resulting in an increase in goodwill of $1,314,000.

11.	POST-EMPLOYMENT BENEFITS
	The Company provides post employment benefits for former Canadian employees who retired on immediate pension prior to 1997. The post employment benefits provided include life insurance and medical and dental benefits as set out in the applicable group policies but does not include pensions. No post employment benefits are provided to employees outside the employee group referenced above. The post employment benefit plan is not funded.
	The effective date of the most recent actuarial valuation of the accrued benefit obligation is December 1, 2008. The amount accrued is based on estimates provided by the plan administrator which are based on past experience, limits on coverage as set out in the applicable group policies and assumptions about future cost trends. The significant assumptions used in the valuation are listed below.

Discount rate	7.50	%
Initial medical cost growth rate per annum	11.00	%
Medical cost growth rate per annum decline to	5.00	%
Year in which medical cost growth rate reaches its final level	2014
Dental cost growth rate per annum	4.00	%

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A continuity summary of post-employment benefits is presented below:

	December 31,			December 31,
(in thousands)	2008			2007
Post-employment liability, beginning of year	$	4,434		$	3,971
Benefits paid		(338	)		(432	)
Interest cost		194			215
Amortization of experience gain		(127	)		—
Foreign exchange		(806	)		680
Post-employment liability, end of year	$	3,357		$	4,434
Post-employment liability:
Accrued benefit obligation	$	3,157		$	4,434
Unamortized experience gain		200			—
Post-employment liability, end of year	$	3,357		$	4,434
Post-employment benefits liability by duration:
Current	$	329		$	404
Non-current		3,028			4,030
	$	3,357		$	4,434

The unamortized experience gain is being amortized on a straight-line basis over the average life expectancy of the retiree group of 10.7 years as at the December 1, 2008 actuarial valuation.

12.	RECLAMATION AND REMEDIATION OBLIGATIONS
	A continuity summary of reclamation and remediation obligations is presented below:

	December 31,			December 31,
(in thousands)	2008			2007
Reclamation obligations, beginning of year	$	20,389		$	18,447
Accretion		1,996			1,364
Expenditures incurred		(849	)		(436	)
Liability adjustments		(339	)		(449	)
Foreign exchange		(1,851	)		1,463
Reclamation obligations, end of year	$	19,346		$	20,389
Site restoration liability by location:
U.S. Mill and Mines	$	11,436		$	10,467
Elliot Lake		6,734			8,319
McLean Lake and Midwest Joint Ventures		1,176			1,603
	$	19,346		$	20,389
Site restoration liability :
Current	$	875		$	565
Non-current		18,471			19,824
	$	19,346		$	20,389

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Site Restoration: U.S. Mill and Mines

The decommissioning and reclamation of the White Mesa mill and U.S. mines are subject to legal and regulatory requirements. Estimates of the costs of reclamation are reviewed periodically by the applicable regulatory authorities. The current estimate for the White Mesa mill and U.S. mines are $8,892,000 and $2,544,000, respectively. The above accrual represents the Company’s best estimate of the present value of future reclamation costs, discounted at 7.5%. The undiscounted amount of estimated future reclamation costs is $23,717,000.

Site Restoration: Elliot Lake

The Elliot Lake uranium mine was closed in 1992 and capital works to decommission this site were completed in 1997. The remaining provision is for the estimated cost of monitoring the Tailings Management Areas at the Company and Stanrock sites and for treatment of water discharged from these areas. The Company conducts its activities at both sites pursuant to decommissioning licenses issued by the Canadian Nuclear Safety Commission. The above accrual represents the Company’s best estimate of the present value of the total future reclamation cost based on assumptions as to levels of treatment, which will be required in the future, discounted at 7.5%. The undiscounted amount of estimated future reclamation costs is $39,020,000.

Spending on restoration activities at the Elliot Lake site are funded from monies in the Elliot Lake Reclamation Trust fund (Note 8).

Site Restoration: McClean Lake Joint Venture and Midwest Joint Venture

The McClean Lake and Midwest operations are subject to environmental regulations as set out by the Saskatchewan government and the Canadian Nuclear Safety Commission. Cost estimates of the estimated future decommissioning and reclamation activities are prepared periodically and filed with the applicable regulatory authorities for approval. The above accrual represents the Company’s best estimate of the present value of the future reclamation cost contemplated in these cost estimates discounted at 7.5%. The undiscounted amount of estimated future reclamation costs is $14,035,000.

Under the Mineral Industry Environmental Protection Regulations (1996), the Company is required to provide its pro-rata share of financial assurances to the province. The Company has provided irrevocable standby letters of credit, from a chartered bank, in favour of Saskatchewan Environment totalling CDN$8,064,000.

13.	DEBT OBLIGATIONS
	Debt obligations consist of:

	At December 31			At December 31
(in thousands)	2008			2007
Revolving line of credit	$	99,998		$	—
Deferred debt issue costs		(769	)		—
Notes payable and other financing		525			42
	$	99,754		$	42
Other long-term liabilities:
Current		464			42
Non-current		99,290			—
	$	99,754		$	42

Revolving Line of Credit

In July 2008, the Company put in place a $125,000,000 revolving term credit facility with the Bank of Nova Scotia. The facility is repayable in full on June 30, 2011.

The borrower under the facility is DMI and DMC has provided an unlimited full recourse guarantee and a pledge of all of the shares of DMI. DMI has provided a first-priority security interest in all present and future personal property and an assignment of its rights and interests under all material agreements relative to the McClean Lake and Midwest projects. In addition, each of DMC’s material U.S subsidiaries has provided an unlimited full recourse guarantee secured by a pledge of all of its shares and a first-priority security interest in all of its present and future personal property.

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The Company is required to maintain certain financial covenants on a consolidated basis.

Interest payable under the facility is bankers acceptance or LIBOR rate plus a margin or prime rate plus a margin. The facility is subject to standby fees. The weighted average interest rate paid by the Company during 2008 was 4.48%.

As at December 31, 2008, the Company has drawn $99,998,000 under the facility. It had also deferred $1,078,000 (CDN$1,122,000) of incremental costs associated with its set-up. These costs are being amortized over the three year term of the facility.

Scheduled Debt Obligation Maturities

The table below represents currently scheduled maturities of debt obligations over the next 5 years

(in thousands)
2009	$	464
2010		16
2011		100,014
2012		16
2013		13
2014 and thereafter		—

14. OTHER LONG-TERM LIABILITIES

Other long-term liabilities consist of:

	At December 31		At December 31
(in thousands)	2008		2007
Unamortized fair value of sales contracts	$	2,429	$	12,812
Unamortized fair value of toll milling contracts		821		1,008
Other		120		100
	$	3,370	$	13,920
Other long-term liabilities:
Current		2,179		6,577
Non-current		1,191		7,343
	$	3,370	$	13,920

Unamortized fair values of sales contracts are amortized to revenue as deliveries under the applicable contracts are made.

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15. INCOME TAXES

The Company operates in multiple industries and jurisdictions, and the related income is subject to varying rates of taxation. A reconciliation of the combined Canadian federal and provincial income tax rate to the Company’s effective rate of income tax is as follows:

(in thousands)	2008			2007
Combined basic tax rate		33.5	%		36.0	%
Income (loss) before taxes	$	(72,976	)	$	34,620
Income tax expense (recovery) at basic tax rate		(24,447	)		12,465
Non-deductible amounts		19,597			796
Non-taxable amounts		(9,138	)		(8,712	)
Flow through shares renounced		(5,267	)		—
Difference in foreign tax rates		504			748
Change in valuation allowance		14,083			(4,227	)
Impact of legislative changes		10,738			(10,797	)
Other		1,602			(2,897	)
Tax expense (recovery) per consolidated financial statements	$	7,672		$	(12,624	)

The tax effects of temporary differences resulting in future income tax assets and future income tax liabilities are presented below:

	December 31,			December 31,
(in thousands)	2008			2007
Future income tax assets:
Inventory	$	3,515		$	—
Property, plant and equipment, net		9,202			9,755
Long-term investments		1,220			—
Intangibles		—			106
Deferred revenue		—			944
Post-employment benefits		960			1,208
Reclamation and remediation obligations		6,160			2,271
Other long-term liabilities		890			3,732
Tax loss carryforwards		12,566			1,735
Other		4,942			3,347
		39,455			23,098
Future income tax liability:
Inventory		(2,802	)		(3,492	)
Long-term investments		(580	)		(4,517	)
Property, plant and equipment, net		(136,754	)		(146,764	)
Intangibles		(1,247	)		(1,770	)
Other		(756	)		—
Future tax liabilities — net		(102,684	)		(133,445	)
Valuation allowance		(21,370	)		(8,080	)
Net future income tax liabilities	$	(124,054	)	$	(141,525	)

Management believes that sufficient uncertainty exists regarding the realization of certain future income tax assets and liabilities that a valuation allowance is required.

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At December 31, 2008, the Company had the following non-capital loss carry-forwards available for tax purposes:

	Amount
Country	(in thousands)		Expiry
Australia	$	1,278	Unlimited
Canada		3,511		2028
Mongolia		358		2009-2010
United States		20,346		2018-2028
Zambia		3,653		2011-2013

The tax benefit of the above Canadian, Mongolian, United States and Zambian non-capital loss carry-forwards has not been recognized in the financial statements.

16. SHARE CAPITAL

Denison is authorized to issue an unlimited number of common shares without par value. A continuity summary of the issued and outstanding common shares and the associated dollar amounts is presented below:

	Number of
	Common
(in thousands except share amounts)	Shares		Amount
Balance at December 31, 2006		178,142,682	$	548,069
Issued for cash:
New issue gross proceeds		10,114,995		105,419
New issue gross issue costs		—		(3,268	)
Exercise of stock options		1,367,962		5,102
Exercise of share purchase warrants		2,592		12
Issued for mineral property acquisition		103,000		947
Fair value of stock options exercised		—		6,663
Fair value of share purchase warrants exercised		—		5
Other		404		—
		11,588,953		114,880
Balance at December 31, 2007		189,731,635	$	662,949
Issues for cash
New issue gross proceeds		7,275,000		6,469
New issue gross issue costs		—		(396	)
Exercise of stock options		288,780		1,527
Renunciation of flow-through share liability		—		(5,267	)
Fair value of stock options exercised		—		996
		7,563,780		3,329
Balance at December 31, 2008		197,295,415	$	666,278

New Issues

In December 2008, the Company completed a private placement of 7,275,000 flow-through common shares at a price of CDN$1.10 per share for gross proceeds of $6,469,000 (CDN$8,002,500). The income tax benefits of this issue were renounced to the subscribers in February 2009.

In April 2007, the Company completed a private placement of 1,104,295 flow-through common shares at a price of CDN$16.30 per share for gross proceeds of $15,572,000 (CDN$18,000,000). The income tax benefits of this issue were renounced to the subscribers in February 2008.

In January 2007, the Company completed a private placement of 9,010,700 common shares at a price of CDN$11.75 per share for gross proceeds of $89,847,000 (CDN$105,876,000).

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Acquisition Related Issues

In January 2007, the Company issued 103,000 common shares at a price of CDN$10.81 per share for a total value of $947,000 (CDN$1,113,000) as part of the acquisition of a U.S. uranium property (see note 7).

Flow-Through Share Issues

The Company finances a portion of its exploration programs through the use of flow-through share issuances. Income tax deductions relating to these expenditures are claimable by the investors and not by the Company.

As at December 31, 2008, the Company has fully met its CDN$18,000,000 April 2007 flow-through share obligation. As at December 31, 2008, the Company has not yet spent any significant monies against its CDN$8,002,500 December 2008 flow-through share obligation.

17. SHARE PURCHASE WARRANTS

A continuity summary of the issued and outstanding share purchase warrants in terms of common shares of the Company and associated dollar amount is presented below:

	Weighted Average		Number of			Fair
	Exercise Price		Common Shares			Value
(in thousands except share amounts)	Per Share (CDN$)		Issuable			Amount
Balance outstanding at December 31, 2006		8.70		9,567,507		$	11,733
Warrants exercised in 2007		5.21		(2,592	)		(5	)
Balance outstanding at December 31, 2007 and December 31, 2008		8.70		9,564,915		$	11,728
Balance exercisable at December 31, 2007 and December 31, 2008		8.70		9,564,915		$	11,728
Balance of common shares issuable by warrant series
November 2004 series (1)				3,156,915			5,898
March 2006 series (2)				6,408,000			5,830
Balance outstanding at December 31, 2007 and December 31, 2008				9,564,915		$	11,728

(1)	The November 2004 series has an effective exercise price of CDN$5.21 per issuable share (CDN$15.00 per warrant adjusted for the 2.88 exchange ratio associated with the Denison and IUC merger) and expires on November 24, 2009.
(2)	The March 2006 series has an effective exercise price of CDN$10.42 per issuable share (CDN$30.00 per warrant adjusted for the 2.88 exchange ratio associated with the Denison and IUC merger) and expires on March 1, 2011.

18. CONTRIBUTED SURPLUS

A continuity summary of contributed surplus is presented below:

	December 31,			December 31,
(in thousands)	2008			2007
Balance, beginning of year	$	25,471		$	30,752
Stock-based compensation expense (note 19)		6,062			1,382
Fair value of stock options exercised		(996	)		(6,663	)
Balance, end of year	$	30,537		$	25,471

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19. STOCK OPTIONS

The Company’s stock-based compensation plan (the “Plan”) provides for the granting of stock options up to 10% of the issued and outstanding common shares at the time of grant, subject to a maximum of 20 million common shares. As at December 31, 2008, an aggregate of 10,307,410 options have been granted (less cancellations) since the Plan’s inception in 1997.

Under the Plan, all stock options are granted at the discretion of the Company’s board of directors, including any vesting provisions if applicable. The term of any stock option granted may not exceed ten years and the exercise price may not be lower than the closing price of the Company’s shares on the last trading day immediately preceding the date of grant. In general, the term of stock options granted under the Plan ranges from three to five years and vesting occurs over a three year period.

A continuity summary of the stock options of the Company granted under the Plan is presented below:

				2008					2007
				Weighted-					Weighted-
				Average					Average
				Exercise					Exercise
	Number of			Price per		Number of			Price per
	Common			Share		Common			Share
	Shares			(CDN $)		Shares			(CDN $)
Stock options outstanding, beginning of year		5,961,354		$	7.27		6,648,316		$	6.23
Granted		3,093,000			7.57		717,000			11.19
Exercised		(288,780	)		5.30		(1,367,962	)		4.21
Forfeitures — voluntary		(2,415,490	)		8.49		—			—
Expired		(813,700	)		6.54		(36,000	)		10.74
Stock options outstanding, end of the year		5,536,384		$	7.11		5,961,354		$	7.27
Stock options exercisable, end of year		4,864,301		$	7.33		5,520,872		$	6.96

A summary of stock options outstanding of the Company at December 31, 2008 is presented below:

	Weighted				Weighted-
	Average				Average
	Remaining				Exercise
	Contractual		Number of		Price per
Range of Exercise Prices per Share	Life		Common		Share
(CDN$)	(Years)		Shares		(CDN $)
Stock options outstanding
$1.37 to $4.87		5.42		1,217,575	$	2.01
$5.02 to $8.50		5.99		1,866,799		5.49
$10.08 to $15.30		1.05		2,452,010		10.87
Stock options outstanding, end of year		3.68		5,536,384	$	7.11

A summary of stock options outstanding of the Company at December 31, 2007 is presented below:

	Weighted				Weighted-
	Average				Average
	Remaining				Exercise
	Contractual		Number of		Price per
Range of Exercise Prices per Share	Life		Common		Share
(CDN$)	(Years)		Shares		(CDN $)
Stock options outstanding
$1.88 to $4.87		6.48		1,044,555	$	2.14
$5.02 to $7.53		7.28		2,225,799		5.29
$10.08 to $15.30		2.10		2,691,000		10.89
Stock options outstanding, end of year		4.80		5,961,354	$	7.27

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Options outstanding at December 31, 2008 expire between May 2009 and October 2016.

The fair value of each option granted is estimated on the date of grant using the Black-Scholes option pricing model. The following table outlines the range of assumptions used in the model for the year:

	2008	2007
Risk-free interest rate	2.58% – 3.29%	3.95% to 4.46%
Expected stock price volatility	52.2% – 61.7%	46.4% – 63.0%
Expected life	2.1 – 3.5 years	2.1 – 3.5 years
Expected forfeitures	—	—
Expected dividend yield	—	—
Fair value per share under options granted	CDN$0.63 – CDN$4.49	CDN$3.18 – CDN$5.32

Stock-based compensation would be allocated as follows in the consolidated statement of operations:

(in thousands)	2008		2007
Operating expenses	$	599	$	423
Mineral property exploration		591		236
General and administrative		4,872		723
	$	6,062	$	1,382

The fair values of stock options with vesting provisions are amortized on a straight-line basis as stock-based compensation expense over the applicable vesting periods. During 2008, 2,415,490 stock options were voluntarily forfeited. These were accounted for as cancelled and the remaining associated fair value of $5,250,000 has been expensed. At December 31, 2008, the Company had an additional $1,254,000 in stock-based compensation expense to be recognized periodically to May 2011.

20. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

A continuity summary of accumulated other comprehensive income (loss) is as follows:

(in thousands)	2008			2007
Cumulative foreign currency translation gain (loss)
Balance, beginning of year	$	92,856		$	(8,498	)
Change in foreign currency translation		(97,781	)		101,354
Balance, end of year		(4,925	)		92,856
Unrealized gains on investments
Balance, beginning of year		18,100			—
Unrealized gains as at January 1, 2007, net of tax (1)		—			24,842
Net increase (decrease) in unrealized gains, net of tax (2)		(17,884	)		(6,742	)
Balance, end of year		216			18,100
Accumulated other comprehensive income (loss), end of year	$	(4,709	)	$	110,956

(1)

Reflects the adoption of CICA Section 3855 on January 1, 2007.

(2)

Unrealized gains (losses) on investments deemed available-for-sale are included in other comprehensive income (loss) until realized. When the investment is disposed of or incurs a decline in value that is other than temporary, the gain (loss) is realized and reclassified to the income statement. During 2008, approximately $196,000 of gains from asset disposals and $12,952,000 of other than temporary losses were realized and reclassified to the income statement within “Other income, net”.

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21. OTHER INCOME, NET

The elements of other income, net in the statement of operations is as follows:

(in thousands)	2008			2007
Interest income, net of fees	$	1,114		$	5,694
Interest expense		(2,652	)		(29	)
Gains (losses) on:
Foreign exchange		15,544			(9,671	)
Land, plant and equipment		125			(18	)
Investment disposals		196			45,115
Investment other than temporary losses		(12,952	)		—
Restricted cash and equivalents		1,176			536
Other		(83	)		—
Other income (expense), net	$	2,468		$	41,627

22. SEGMENTED INFORMATION

Business Segments

The Company operates in two primary segments — the mining segment and the corporate and other segment. The mining segment, which has been further subdivided by major geographic regions, includes activities related to exploration, evaluation and development, mining, milling and the sale of mineral concentrates. The corporate and other segment includes the results of the Company’s environmental services business, management fees and commission income earned from UPC and general corporate expenses not allocated to the other segments.

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For 2008, business segment results were as follows:

	Canada			U.S.A			Africa			Asia			Corporate
(in thousands)	Mining			Mining			Mining			Mining			and Other			Total
Statement of Operations:
Revenues		52,698			61,995			—			—			8,491			123,184
Expenses
Operating expenses		44,432			67,612			—			—			6,025			118,069
Sales royalties and capital taxes		3,016			—			—			—			101			3,117
Mineral property exploration		11,953			298			3,079			4,784			—			20,114
General and administrative		—			—			—			—			14,754			14,754
Stock option expense		—			—			—			—			6,062			6,062
Goodwill impairment		36,512			—			—			—			—			36,512
		95,913			67,910			3,079			4,784			26,942			198,628
Income (loss) from operations		(43,215	)		(5,915	)		(3,079	)		(4,784	)		(18,451	)		(75,444	)
Revenues — supplemental:
Uranium concentrates		52,698			61,890			—			—			—			114,588
Environmental services		—			—			—			—			5,562			5,562
Management fees and commissions		—			—			—			—			2,929			2,929
Alternate feed processing and other		—			105			—			—			—			105
		52,698			61,995			—			—			8,491			123,184
Long-lived assets:
Property, plant and equipment
Plant and equipment		78,223			73,859			669			282			1,293			154,326
Mineral properties		289,637			43,324			223,456			6,690			—			563,107
Intangibles		—			422			—			—			4,556			4,978
Goodwill		63,240			—			—			—			—			63,240
		431,100			117,605			224,125			6,972			5,849			785,651

- 29 -

For 2007, business segment results were as follows:

	Canada			U.S.A		Africa		Asia			Corporate
(in thousands)	Mining			Mining		Mining		Mining			and Other			Total
Statement of Operations:
Revenues		32,915			34,736		—		—			9,113			76,764
Expenses
Operating expenses		27,012			14,598		—		—			5,428			47,038
Sales royalties and capital taxes		2,215			—		—		—			86			2,301
Mineral property exploration		16,402			126		—		4,067			132			20,727
General and administrative		—			—		—		—			12,323			12,323
Stock option expense		—			—		—		—			1,382			1,382
		45,629			14,724		—		4,067			19,351			83,771
Income (loss) from operations		(12,714	)		20,012		—		(4,067	)		(10,238	)		(7,007	)
Revenues — supplemental:
Uranium concentrates		32,915			32,210		—		—			—			65,125
Environmental services		—			—		—		—			4,723			4,723
Management fees and commissions		—			—		—		—			4,390			4,390
Alternate feed processing and other		—			2,526		—		—			—			2,526
		32,915			34,736		—		—			9,113			76,764
Long-lived assets:
Property, plant and equipment
Plant and equipment		86,810			38,981		314		88			1,899			128,092
Mineral properties		369,066			18,601		209,694		2,370			—			599,731
Intangibles		—			484		—		—			6,495			6,979
Goodwill		122,330			—		—		—			—			122,330
		578,206			58,066		210,008		2,458			8,394			857,132

Revenue Concentration

The Company’s business is such that, at any given time, it sells its uranium and vanadium concentrates to and enters into process milling arrangements and other services with a relatively small number of customers. During 2008, four customers accounted for approximately 68% of total revenues. During 2007, three customers accounted for approximately 91% of total revenues.

23. RELATED PARTY TRANSACTIONS

Uranium Participation Corporation

The Company is a party to a management services agreement with UPC. Under the terms of the agreement, the Company will receive the following fees from UPC: a) a commission of 1.5% of the gross value of any purchases or sales of U₃O₈ and UF₆ completed at the request of the Board of Directors of UPC; b) a minimum annual management fee of CDN$400,000 (plus reasonable out-of-pocket expenses) plus an additional fee of 0.3% per annum based upon UPC’s net asset value between CDN$100,000,000 and CDN$200,000,000 and 0.2% per annum based upon UPC’s net asset value in excess of CDN$200,000,000; c) a fee of CDN$200,000 upon the completion of each equity financing where proceeds to UPC exceed CDN$20,000,000; d) a fee of CDN$200,000 for each transaction or arrangement (other than the purchase or sale of U₃O₈ and UF₆) of business where the gross value of such transaction exceeds CDN$20,000,000 (“an initiative”); e) an annual fee up to a maximum of CDN$200,000, at the discretion of the Board of Directors of UPC, for on-going maintenance or work associated with an initiative; and f) a fee equal to 1.5% of the gross value of any uranium held by UPC prior to the completion of any acquisition of at least 90% of the common shares of UPC.

In accordance with the management services agreement, all uranium investments owned by UPC are held in accounts with conversion facilities in the name of DMI as manager for and on behalf of UPC.

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From time to time, the Company has also provided temporary revolving credit facilities to UPC which generate interest and standby fee income. As at December 31, 2008 and December 31, 2007, there were no drawn amounts outstanding under these facilities.

In 2008, the Company sold 50,000 pounds of U₃O₈ to UPC at a price of $64.50 per pound for total consideration of $3,225,000. In 2007, the Company sold 75,000 pounds of U₃O₈ to UPC at a price of $130.00 per pound for total consideration of $9,750,000.

The following transactions were incurred with UPC for the periods noted:

(in thousands)	2008		2007
Revenue
Uranium sales	$	3,225	$	9,750
Management fees (including expenses)		1,695		2,301
Commission fees on purchase and sale of uranium		1,234		2,089
Other income (expense):
Loan interest under credit facility		—		202
Standby fee under credit facility		—		9
	$	6,154	$	14,351

At December 31, 2008, accounts receivable includes $130,000 (2007: $377,000) due from UPC with respect to the fees indicated above.

Other

During 2008 and 2007, the Company had the following additional related party transactions:

a) In 2007, the Company sold 16,562,500 shares of Fortress to a company associated with the Chairman of the Company for gross proceeds of approximately CDN$20,703,000;

b) Management and administrative service fees of $162,000 (2007: $251,000) with a company owned by the Chairman of the Company which provides corporate development, office premises, secretarial and other services. At December 31, 2008, an amount of nil (2007: $9,000) was due to this company; and

c) In 2007, the Company provided executive and administrative services to Fortress and charged an aggregate of $69,000 for such services.

24. JOINT VENTURE INTERESTS

The Company conducts a substantial portion of its production and exploration activities through joint ventures. The joint ventures allocate production and exploration expenses to each joint venture participant and the participant derives revenue directly from the sale of such product. The Company records its proportionate share of assets, liabilities and operating costs of the joint ventures.

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A summary of joint venture information is as follows:

(in thousands)	2008			2007
Operating expenses	$	43,779		$	26,179
Mineral property exploration		14,168			14,009
General and administrative		214			63
Net other income		(40	)		(46	)
Loss for the year before taxes		58,121			40,205
Current assets		15,718			21,044
Property, plant and equipment
Plant and equipment		77,669			85,997
Mineral properties		296,307			371,437
Intangibles		421			484
Current liabilities		4,176			4,177
Long-term liabilities		2,096			2,712
Net investment in joint ventures	$	383,843		$	472,073

25. SUPPLEMENTAL CASH FLOW INFORMATION

The net change in non-cash working capital items is as follows:

(in thousands)	2008			2007
Decrease (increase) in non-cash working capital items:
Trade and other receivables	$	23,812		$	(28,443	)
Inventories		(51,099	)		(9,468	)
Prepaid expenses and other current assets		136			(687	)
Accounts payable and accrued liabilities		3,136			14,636
Reclamation and remediation obligations		(849	)		(436	)
Deferred revenue		554			(1,480	)
Post-employment benefits		(338	)		(432	)
Net change in non-cash working capital items	$	(24,648	)		(26,310	)

26. CAPITAL MANAGEMENT AND FINANCIAL INSTRUMENTS

Capital Management

The Company’s capital includes debt and shareholder’s equity. The Company’s primary objective with respect to its capital management is to ensure that it has sufficient capital to maintain its ongoing operations, to provide returns for shareholders and benefits for other stakeholders and to pursue growth opportunities. As at December 31, 2008, the Company is not subject to externally imposed capital requirements (other than the financial covenants relating to the revolving credit facility) and there has been no change with respect to the overall capital risk management strategy.

The total capital as at December 31, 2008 and 2007 is calculated as follows:

(in thousands)	2008			2007
Debt obligations — current and long-term	$	99,754		$	42
Less: Cash and equivalents		(3,206	)		(19,680	)
Adjusted net debt (cash)		96,548			(19,638	)
Shareholders’ Equity		608,352			796,270
Adjusted net debt to Shareholders’ Equity ratio		15.9	%		—

The debt obligations increased during the year to finance the Company’s ongoing mine development and exploration programs.

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Fair Values of Financial Instruments

The Company examines the various financial instrument risks to which it is exposed and assesses the impact and likelihood of those risks. These risks may include credit risk, liquidity risk, currency risk, interest rate risk and price risk.

(a) Credit Risk

Credit risk is the risk of loss due to a counterparty’s inability to meet its obligations. The Company’s credit risk is related to trade receivables in the ordinary course of business, cash and cash equivalents and investments. The Company sells uranium exclusively to large organizations with strong credit ratings and the balance of trade receivables owed to the Company in the ordinary course of business is not significant. Cash and cash equivalents are in place with major financial institutions and the Canadian and US government. Therefore, the Company is not exposed to significant credit risk and overall the Company’s credit risk has not changed significantly from the prior year.

(b) Liquidity Risk

Liquidity risk is the risk that the Company will encounter difficulties in meeting obligations associated with its financial liabilities and other contractual obligations. The Company has in place a planning and budgeting process to help determine the funds required to support the Company’s normal operating requirements on an ongoing basis. The Company ensures that there is sufficient committed capital to meet its short-term business requirements, taking into account its anticipated cash flows from operations and its holdings of cash and cash equivalents. The Company has in place a three year term revolving credit facility in the amount of US$125,000,000 to meet its cash flow needs (see note 13).

The maturities of the Company’s financial liabilities are as follows:

	Within 1		1 to 5
(in thousands)	Year		Years
Accounts payable and accrued liabilities	$	23,787	$	—
Debt obligations (Note 13)		464		100,059
	$	24,251	$	100,059

(c) Currency Risk

Foreign exchange risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company’s risk management objective is to reduce cash flow risk related to foreign denominated cash flows. Financial instruments that impact the Company’s operations or other comprehensive income due to currency fluctuations include: non United States dollar denominated cash and cash equivalents, accounts receivable, accounts payable, long-term investments and bank debt.

The sensitivity of the Company’s operations and other comprehensive income due to changes in the exchange rate between the Canadian dollar and its Zambian kwacha functional currencies and its United States dollar reporting currency as at December 31, 2008 is summarized below:

				Change in
	Change in			Comprehensive
(in thousands)	Net Income (1)			Net Income (1)
Canadian dollar
10% increase in value	$	(924	)	$	41,561
10% decrease in value	$	924		$	(41,561	)
Zambian kwacha
10% increase in value	$	(5,429	)	$	(5,429	)
10% decrease in value	$	5,429		$	5,429

(1) In the above table, positive (negative) values represent increases (decreases) in net income and comprehensive net income respectively.

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(d) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its outstanding borrowings and short-term investments. Presently, all of the Company’s outstanding borrowings are at floating interest rates. The Company monitors its exposure to interest rates and has not entered into any derivative contracts to manage this risk. The weighted average interest rate paid by the Company during 2008 on its outstanding borrowings was 4.48%.

An increase in interest rates of 100 basis points (1 percent) would have increased the amount of interest expense recorded in 2008 by approximately $624,000.

(e) Price Risk

The Company is exposed to price risk on the commodities which it produces and sells. The Company is exposed to equity price risk as a result of holding long-term investments in other exploration and mining companies. The Company does not actively trade these investments.

The sensitivity analyses below have been determined based on the exposure to commodity price risk and equity price risk at December 31, 2008:

				Change in
	Change in			Comprehensive
(in thousands)	Net Income (1)			Net Income (1)
Commodity price risk
10% increase in uranium prices (2)	$	5,906		$	5,906
10% decrease in uranium prices (2)	$	(5,906	)	$	(5,906	)
Equity price risk
10% increase in equity prices	$	—		$	1,069
10% decrease in equity prices	$	—		$	(1,069	)

(1)	In the above table, positive (negative) values represent increases (decreases) in net income and comprehensive net income respectively.
(2)	The Company is exposed to fluctuations in both the spot price and long-term price of uranium as a result of the various pricing formulas in the uranium contracts. The above sensitivity analysis is prepared using the 12 month average actual realized price and adjusting the uranium pricing formulas for a 10% increase or decrease in spot and long-term prices as applicable.

(f) Fair Value Estimation

The fair value of financial instruments which trade in active markets (such as available-for-sale securities) is based on quoted market prices at the balance sheet date. The quoted marked price used to value financial assets held by the Company is the current bid price.

The fair values of cash and cash equivalents, trade and other receivables and accounts payable and accrued liabilities approximate their carrying values because of the short-term nature of these instruments.

The fair values of the Company’s restricted cash and equivalents in cash and cash equivalents, U.S. government bonds, commercial paper and corporate bonds approximate carrying values.

The fair value of the Company’s debt obligations is approximately $83,740,000.

27. COMMITMENTS AND CONTINGENCIES

General Legal Matters

The Company is involved, from time to time, in various legal actions and claims in the ordinary course of business. In the opinion of management, the aggregate amount of any potential liability is not expected to have a material adverse effect on the Company’s financial position or results.

Third Party Indemnities

The Company has agreed to indemnify Calfrac Well Services against any future liabilities it may incur related to the assets or liabilities transferred to the Company on March 8, 2004.

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Performance Bonds and Letters of Credit

In conjunction with various contracts, reclamation and other performance obligations, the Company may be required to issue performance bonds and letters of credit as security to creditors to guarantee the Company’s performance. Any potential payments which might become due under these items would be related to the Company’s non-performance under the applicable contract. As at December 31, 2008, the Company had outstanding bonds and letters of credit of $24,081,000 of which $19,745,000 is collateralized by restricted cash and equivalents (see note 8) and $6,645,000 is collateralized by a reduction in the Company’s line of credit limit available for general corporate purposes.

Others

The Company has committed to payments under various operating leases. The future minimum lease payments are as follows:

(in thousands)
2009	$	953
2010		827
2011		444
2012		294
2013		106
2014 and thereafter		196

28. SUBSEQUENT EVENTS

On January 27, 2009, Denison issued 28,750,000 common shares at a price of CDN$1.65 per common share for gross proceeds of $38,946,000 (CDN$47,437,500). Share issue costs are anticipated to be $2,000,000.

29. MATERIAL DIFFERENCES BETWEEN CANADIAN AND U.S. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

The consolidated financial statements have been prepared in accordance with Canadian GAAP which differ in certain material respects from those principles and practices that the Company would have followed had its consolidated financial statements been prepared in accordance with U.S. GAAP. Material differences between financial statement items under Canadian GAAP and the amounts determined under U.S. GAAP are as follows:

a) Cash and Equivalents

U.S. GAAP requires that funds raised through the issuance of flow-through shares be shown as restricted cash and not be considered to be a component of cash and cash equivalents. In addition, the restricted cash would be excluded from cash and cash equivalents in the statement of cash flows and shown as a financing activity. At December 31, 2008 $6,469,000 of funds raised from the issue of flow-through shares remained (December 31, 2007: $7,862,000).

b) Plant and Equipment

Under U.S. GAAP, assets held for resale are recorded at the lower of cost or net realizable value and are not depreciated.

c) Mineral Properties and Inventory Valuation

Under Canadian GAAP, the Company expenses exploration and development expenditures on mineral properties not sufficiently advanced to identify their development potential. At the point in time when management has concluded that the mineral property has sufficient development potential, costs are accumulated and recorded as mineral property assets. Under U.S. GAAP and practices prescribed by the SEC, all mine project related costs incurred before a commercially mineable deposit is established are expensed as incurred. The U.S defines a commercially mineable deposit as one with proven and probable reserves which are legally extractable and a bankable feasibility study.

The Company amortizes its mineral property assets on a units of production basis and includes that amount in the valuation of work-in-progress and concentrate inventories. Since the value of the Company’s mineral property assets is less under U.S GAAP than Canadian GAAP, the amount amortized to inventory is also less. As a result, the carrying value of inventory is also reduced to reflect the lower amortization cost.

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d) Joint Ventures

Under Canadian GAAP, investments in jointly-controlled entities are permitted to be accounted for using the proportionate consolidation method. Under U.S. GAAP, investments in jointly-controlled entities are accounted for using the equity method. Although there are material differences between these accounting methods, the Company relies on an accommodation of the United States Securities and Exchange Commission (“SEC”) permitting the Company to exclude the disclosure of such differences which affect only the display and classification of financial statement items excluding shareholders’ equity and net income.

e) Goodwill

Under Canadian GAAP, the Company’s formation in 1997 through an amalgamation of IUC with Thornbury Capital Corporation (“Thornbury”) has been accounted for as an acquisition of Thornbury resulting in the recording of goodwill. Under U.S. GAAP, the transaction has been accounted for as a recapitalization whereby the net monetary assets of Thornbury would be recorded at fair value, except that no goodwill or other intangibles would be recorded. The goodwill recorded under Canadian GAAP has been subsequently written off. As a result, the deficit and share capital of the Company are both reduced under U.S. GAAP.

f) Liabilities

Under U.S. GAAP, the sale of flow-through shares results in a liability being recognized for the excess of the purchase price paid by the investors over the fair value of common shares without the flow-through feature. The fair value of the shares is recorded as equity. When the tax deductibility of the expenditures is renounced, the liability is reversed and a future income tax liability is recorded for the amount of the benefits renounced to third parties and an income tax expense is recognized. Under Canadian GAAP, an adjustment to share capital is recorded for recognized future tax liabilities related to the renunciation of flow-through share expenditures.

g) Dilution Gains

Under Canadian GAAP, gains on dilution of interests in a subsidiary or equity interest are recognized in income in the period in which they occur. Under U.S. GAAP, the gain on dilution is not recognized if it results from the sale of securities by a company in the exploration stage and instead is accounted for as a capital transaction.

The consolidated balance sheet items, adjusted to comply with U.S. GAAP, would be as follows:

	December 31, 2008
	Canadian								U.S.
	GAAP					Adjustments			GAAP
Cash and cash equivalents	$	3,206		(a	)	$	(6,469	)	$	(3,263	)
Inventories		44,733		(c	)		(909	)		43,824
Property, plant and equipment		717,433		(c	)		(62,270	)		655,163
Restricted cash and equivalents		21,286		(a	)		6,469			27,755
Accounts payable and accrued liabilities		23,787		(f	)		1,682			25,469
Future income tax liability		124,054		(c	)		(1,373	)		122,681
Share capital		666,278		(e	)		(616	)
				(f	)		(1,682	)		663,980
Additional paid-in capital		—		(g	)		9,814			9,814
Deficit		(95,482	)	(c	)		(63,746	)
				(c	)		1,373
				(e	)		616
				(g	)		(9,814	)		(167,053	)
Accumulated other comprehensive loss		(4,709	)	(c	)		567			(4,142	)

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	December 31, 2007
	Canadian								U.S.
	GAAP					Adjustments			GAAP
Cash and cash equivalents	$	19,680		(a	)	$	(7,862	)	$	11,818
Property, plant and equipment		727,823		(c	)		(16,444	)		711,379
Restricted cash and equivalents		17,797		(a	)		7,862			25,659
Accounts payable and accrued liabilities		22,642		(f	)		3,114			25,756
Future income tax liability		141,525		(c	)		(4,621	)		136,904
Share capital		662,949		(e	)		(616	)
				(f	)		(3,114	)		659,219
Additional paid-in capital		—		(g	)		9,814			9,814
Deficit		(14,834	)	(c	)		(16,098	)
				(c	)		4,621
				(e	)		616
				(g	)		(9,814	)		(35,509	)
Accumulated other comprehensive income		110,956		(c	)		(346	)		110,610

The consolidated statements of operations and deficit and comprehensive income, adjusted to comply with U.S. GAAP, would be as follows:

			2008			2007
Net income (loss) for the year, Canadian GAAP			$	(80,648	)	$	47,244
Depreciation of assets held for resale	(b	)		—			(301	)
Adjust capitalized mineral property amounts, net of tax	(c	)		(49,987	)		(11,477	)
Adjust inventory valuation, net of tax	(c	)		(909	)		—
Net income (loss) for the year, U.S. GAAP			$	(131,544	)	$	35,466
Deficit, beginning of year, U.S. GAAP			$	(35,509	)	$	(70,975	)
Deficit, end of year, U.S. GAAP			$	(167,053	)	$	(35,509	)
Comprehensive income, U.S. GAAP
Net income (loss) for the year, U.S. GAAP			$	(131,544	)	$	35,466
Unrealized gain (loss) on available-for-sale securities				(17,884	)		(6,742	)
Cumulative foreign currency translation gain (loss)				(96,868	)		101,008
Comprehensive income (loss), U.S. GAAP				(246,296	)		129,732
Basic net income (loss) per share, U.S. GAAP			$	(0.69	)	$	0.19
Diluted net Income (loss) per share, U.S. GAAP			$	(0.69	)	$	0.18

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The consolidated statements of cash flows, adjusted to comply with U.S. GAAP, would be as follows:

			2008			2007
Net cash provided by (used in) operating activities:
Under Canadian GAAP			$	(8,764	)	$	(23,084	)
Adjustment for capitalized mineral property amounts	(c	)		(62,837	)		(16,098	)
Under U.S. GAAP			$	(71,601	)	$	(39,182	)
Net cash provided by (used in) investing activities:
Under Canadian GAAP			$	(115,706	)	$	(158,469	)
Adjustment for capitalized mineral property amounts	(c	)		62,837			16,098
Under U.S. GAAP			$	(52,869	)	$	(142,371	)
Net cash provided by (used in) financing activities:
Under Canadian GAAP			$	107,147		$	107,215
Restricted cash from flow-through financings	(a	)		(6,469	)		(7,862	)
Under U.S. GAAP			$	100,678		$	99,353

Impact of New Accounting Pronouncements

a)	Effective January 1, 2007, the Company adopted the Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 clarifies the accounting for income taxes by prescribing the minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. In addition, FIN 48 scopes out income taxes from FASB Statement No. 5, Accounting for Contingencies. FIN 48 applies to all tax positions related to income taxes subject to FASB Statement No. 109, Accounting for Income Taxes. This includes tax positions considered to be “routine” as well as those with a high degree of uncertainty.
	The provisions of FIN 48 prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The interpretation requires that the Company recognize the impact of a tax position in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. FIN 48 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure. In accordance with the provisions of FIN 48, any cumulative effect resulting from the change in accounting principle is to be recorded as an adjustment to the opening balance of retained earnings (deficit). The adoption of FIN 48 did not materially impact the Company’s consolidated financial position or results of operations.
b)	Effective January 1, 2007, the Company adopted FSP No. AUG AIR-1, “Accounting for Planned Major Maintenance Activities”. The FSP permits companies to account for planned major maintenance activities using; the direct expensing method, the built-in overhaul method or the deferral method. The FSP was adopted on a retrospective basis. The Company has chosen the direct expensing method. The adoption of this standard did not have a material impact on the Company’s consolidated financial position or results of operations.
c)	Effective January 1, 2008, the Company adopted FASB Statement No. 157, Fair Value Measurements (“SFAS 157”). The Company also applied FSP FAS 157-2, which allows for the delay of implementation of FAS No. 157 for certain nonfinancial assets and nonfinancial liabilities until its fiscal year beginning January 1, 2009. SFAS 157 provides enhanced guidance for using fair value to measure assets and liabilities and provides expanded disclosure about the extent to which companies measure their assets and liabilities at fair value, the information used to measure fair value, and the effect of fair value measurements on earnings. SFAS 157 applies whenever other standards require (or permit) assets or liabilities to be measured at fair value; however, it does not expand the use of fair value in any new circumstances. The adoption of this standard did not have a material impact on the Company’s consolidated financial position or results of operations.

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d) Effective January 1, 2008, the Company adopted, the FASB Statement No. 159 (FAS 159), The Fair Value Option for Financial Assets and Financial Liabilities. This statement expands the standards under FAS 157, Fair Value Measurement, to provide entities the one-time election (Fair Value Option) to measure financial instruments and certain other items at fair value. The adoption of this standard did not have a material impact on the Company’s consolidated financial position or results of operations.

Recent United States accounting pronouncements:

a)	In December 2007, FASB Statement No. 141(R), Business Combinations and No. 160, Non-controlling Interests in Consolidated Financial Statements. SFAS 141(R) and 160 provide standards with respect to improving, simplifying and converging the prevailing FASB accounting and reporting standards for business combinations and non-controlling interests in consolidated financial statements with International Accounting Standards Board (“IASB”) standards for business combinations with an acquisition date in the fiscal year beginning after December 15, 2008.
	FASB 141 (R) requires an acquiring entity in a business combination to recognize all (and only) the assets acquired and liabilities assumed in the transaction; establishes the acquisition-date fair value as the measurement objective for all assets acquired and liabilities assumed; and requires the acquirer to disclose to investors and other users all of the information they need to evaluate and understand the nature and financial effect of the business combination. FASB 160 requires all entities to report non-controlling (minority) interests in subsidiaries in the same way — as equity in the consolidated financial statements.
b)	In March 2008, FASB Statement No.161, “Disclosures about Derivative Instruments and Hedging Activities an amendment of FASB Statement 133”. SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008. The adoption is not expected to have a material impact on the Company’s consolidated results of operations and financial position.
c)	In May 2008, FASB Statement No.162, “The Hierarchy of Generally Accepted Accounting Principles” (SFAS 162). Under SFAS 162, the US GAAP hierarchy will now reside in the accounting literature established by the FASB. SFAS No. 162 identifies the sources of accounting principles and the framework for selecting the principles used in the preparation for the financial statements in conformity with US GAAP SFAS. The adoption of SFAS No 162 is not expected to have a material impact on the Company’s consolidated results of operations and financial position.

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EX-2

Exhibit 2

CSA Global (UK) Ltd. – NI 43-101 Technical Report
Mutanga Project, Zambia – 19 March 2009

NI43-101 Technical Report

The Mutanga Project

Located in Southern Province, Republic of Zambia

Prepared For

Denison Mines Corp.
Atrium on Bay 595 Bay
Street, Suite 402
Toronto, Ontario
M5G 2C2

Prepared By

Mr Malcolm Titley of CSA Global (UK) Ltd

BSc (Geology & Chemistry), MAusIMM, MAIG

2 Peel House, Barttelot Road, Horsham, West

Sussex England, United Kingdom, RH12 1DE

19 March 2009

CSA Global (UK) Ltd. — NI 43-101 Technical Report
Mutanga Project, Zambia — 19 March 2009

TABLE OF CONTENTS

GLOSSARY OF TERMS	13
1.0 SUMMARY	18
2.0 INTRODUCTION AND TERMS OF REFERENCE	21
3.0 RELIANCE ON OTHER EXPERTS	22
4.0 PROPERTY DESCRIPTION AND LOCATION	23
4.1 Property Location	23
4.2 Land Area	23
4.3 Prospecting Claim Description	24
4.4 Nature of the Prospecting Licence	24
4.5 Renewal of the Prospecting Licence	24
4.6 Royalties on Production of Minerals	24
4.7 Agreements and Encumbrances	24
5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY	25
5.1 Physiography	25
5.2 Vegetation and Fauna	25
5.3 Climate	26
5.4 Local Resources and Infrastructure	27
6.0 HISTORY	29
6.1 Prior Ownership History	29
6.2 Exploration History	29
6.2.1 Mutanga Prospect Historical Exploration	30
6.2.2 Dibwe Historical Exploration	33
6.2.3 Mutanga-Dibwe Area Historical Exploration	34
6.2.4 Bungua Historical Exploration	37
6.2.5 Other Activities	38
6.3 Resource and Reserve History	38
6.4 Production History	40

Page 2 of 225

CSA Global (UK) Ltd. — NI 43-101 Technical Report
Mutanga Project, Zambia — 19 March 2009

7.0 GEOLOGICAL SETTING	41
7.1 Regional Geology	41
7.2 Local Geology	42
7.2.1 Mutanga Deposit Geology	45
7.2.2 Dibwe Geology	50
8.0 DEPOSIT TYPES	51
9.0 MINERALISATION	52
9.1 Mineralisation and Alteration	52
9.1.1 Mutanga deposit	55
9.2 Mineralisation Styles	56
9.2.1 Disseminated U3O8	56
9.2.2 Fracture Hosted	58
10.0 EXPLORATION	60
10.1 Geophysical Surveys	60
10.1.1 Helicopter-borne Geophysical Survey	60
10.1.1.1 Digital Products	63
10.1.1.2 Re-flight Specifications	64
10.1.1.3 Results Of Airborne Radiometric Surveys	65
10.2 Mapping	66
11.0 DRILLING	68
11.1 Development Drilling	68
11.2 Drill Collar and Down Hole Survey Data	72
11.3 Specific Gravity	73
11.4 Down Hole Geophysical Probing	73
11.5 Drilling Quality and Geotechnical Logging	74
12.0 SAMPLING METHOD AND ANALYSIS	75
12.1 Sampling	75
12.2 Scintillometer Logging	75
12.3 Down Hole Logging	75
12.4 Diamond Core Sampling	75
12.5 RC Drill Hole Sampling	75

Page 3 of 225

CSA Global (UK) Ltd. — NI 43-101 Technical Report
Mutanga Project, Zambia — 19 March 2009

13.0 SAMPLE PREPARATION, ANALYSES AND SECURITY	76
13.1 Geological Logging	76
13.2 Sampling – Diamond Drilling	76
13.3 Sampling – RC Percussion Drilling	76
13.4 Sample Security	76
13.5 Analytical Laboratories	76
13.6 Sample Procedure and Analytical Analysis	77
13.7 Assay Standards	77
13.8 Duplicate and Repeat Sample Analysis	77
13.9 Quality Control Procedures	78
13.9.1 Field Duplicates	78
13.9.2 Field Standards	80
13.9.3 QAQC Conclusions	86
14.0 DATA VERIFICATION	87
14.1 Quality Control Procedures	87
14.1.1 Processes for Determining Uranium Content by Gamma Logging	87
14.1.2 Core Sampling, Processing and Assaying	88
14.1.3 Quality Assurance and Quality Control Measures	89
14.2 Survey Control	90
14.3 Drill Hole Location	90
14.4 Down Hole Surveys	93
14.5 Surface Topography Validation 2007	93
14.5.1 Mutanga Digital Topography Model 2007	94
14.5.2 Dibwe Digital Topography Model 2007	95
14.6 Drill hole Recovery	98
15.0 ADJACENT PROPERTIES	99
16.0 MINERAL PROCESSING AND METALLURGICAL TESTING	100
17.0 MINERAL RESOURCE ESTIMATES	101
17.1 Mineral Resource Overview and Summary	101
17.2 Input Data	103
17.2.1 Drilling Data	103
17.2.2 Topographic Data and Validation	105
17.3 Data Validation	110
17.3.1 Drill Hole Data Validations.	110
17.3.2 Gamma Data Review	112
17.3.2.1 Mutanga	113
17.3.2.2 Dibwe	119
17.3.3 Gamma Data Review – Conclusions	122

Page 4 of 225

CSA Global (UK) Ltd. — NI 43-101 Technical Report
Mutanga Project, Zambia — 19 March 2009

17.4 Geological Modelling	122
17.4.1 Geological Interpretation — Mutanga Deposit	123
17.4.2 Geological Interpretation — Dibwe Deposit	126
17.5 Statistical Analysis	129
17.5.1 Historic Data Analysis	129
17.5.2 Statistical Analysis – Mutanga	131
17.5.2.1 Statistical Analysis – Drill Type	131
17.5.2.2 Mutanga Domain Statistics	133
17.5.2.3 Compositing	135
17.5.2.4 Top-Cuts	136
17.5.2.5 Mutanga Top-cut Domain Statistics	137
17.5.3 Statistical Analysis – Dibwe	141
17.5.3.1 Statistical Analysis – Drill Type	141
17.5.3.2 Compositing	144
17.5.3.3 Top-Cuts	144
17.5.3.4 Dibwe Top-cut Domain Statistics	145
17.6 In Situ Dry Bulk Density Statistics	148
17.7 Variography	150
17.7.1 Mutanga — Variography	150
17.7.2 Dibwe Mineralisation U3O8 Variography	156
17.8 Grade Estimation	157
17.8.1 Mutanga Grade Estimation	157
17.8.1.1 Mutanga Block Model Construction	157
17.8.1.2 Mutanga Grade Estimation Parameters	158
17.8.1.3 Mutanga Model Validation	160
17.8.2 Dibwe Grade Estimation	172
17.8.2.1 Dibwe Block Model Construction	172
17.8.2.2 Dibwe Grade Estimation Parameters	173
17.8.2.3 Dibwe Model Validation	175
17.9 Mineral Resource Reporting	179
17.9.1 Classification of the Mutanga and Dibwe Mineral Resource Estimates	180
17.9.2 Mineral Resource Tabulations	182
17.9.3 Comparison to previous estimates	184

Page 5 of 225

CSA Global (UK) Ltd. — NI 43-101 Technical Report
Mutanga Project, Zambia — 19 March 2009

18.0 OTHER RELEVANT DATA AND INFORMATION	186
18.1 De-mining and UXO Program	186
19.0 INTERPRETATION AND CONCLUSIONS	187
20.0 RECOMMENDATIONS	193
21.0 REFERENCES	195
22.0 DATE AND SIGNATURE PAGE	196
23.0 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT PROPERTIES AND PRODUCTION PROPERTIES	197
24.0 ILLUSTRATIONS	198
25.0 CERTIFICATES AND CONSENTS	199

Page 6 of 225

CSA Global (UK) Ltd. — NI 43-101 Technical Report
Mutanga Project, Zambia — 19 March 2009

LIST OF FIGURES

Figure 4.1: Mutanga Project Location Plan and Geology	23
Figure 5.1: Zambia Electrical Infrastructure	28
Figure 6.1: AGIP Diamond and Wagon Drill Hole Location Map	32
Figure 6.2: Dibwe Mineralised Domains and Drill Hole Coverage	34
Figure 6.3: Dibwe – Mutanga Geological Map	35
Figure 6.4: Drill Hole Location Plan RDM Series Holes Over 2006 Helicopter-borne Geophysics	36
Figure 6.5: Bungua Area Geology and Prospect Locations	37
Figure 7.1: Mutanga Project Location and Regional Geological Setting	41
Figure 7.2: Stratigraphic Sequence of Mutanga Project (Geological Survey Lusaka Office)	42
Figure 7.4: Dibwe – Mutanga Geological Map	44
Figure 7.5: Surface Geology and Drilling Plan of Mutanga Deposit	46
Figure 7.6: Dibwe, Dibwe West and Dibwe North Surface Geology and Drill hole Plan	50
Figure 10.1: Plan Showing Area of 2008 Airborne Geophysical Survey	62
Figure 10.2: Radiometric Anomalies Identified by the OmegaCorp 2005 and Denison 2008 Airborne Radiometric Surveys	65
Figure 11.1: Mutanga Drill Hole Collar Plan – December 2008	71
Figure 11.2: Dibwe Drill Hole Collar Plan – December 2008	72
Figure 13.1: Field Duplicate Scatter Plot	79
Figure 13.2: Control Plot for Denison Field Standard UREM3/SARM23	81
Figure 13.3: Control Plot for Denison Field Standard UREM 4/SARM 24	81
Figure 13.4: Control Plot for Denison Field Standard UREM 5/SARM25	82
Figure 13.5: Control Plot for Denison Field Standard UREM 6/SARM26	82
Figure 13.6: Control Plot for all Internal Laboratory Standards	83
Figure 13.7: Control Plot for All Internal Laboratory Standard UREM3	84
Figure 13.8: Control Plot for All Internal Laboratory Standard UREM4	84
Figure 13.9: Control Plot for All Internal Laboratory Standard UREM5	85
Figure 13.10: Control Plot for All Internal Laboratory Standard UREM6	85
Figure 14.1: Distribution of Differences For Mutanga Topography DTM And Drill Holes	94
Figure 14.2: Three Dimensional View of Mutanga Drill Holes Showing Inconsistency between Topography DTM and Drill Hole Collars	95
Figure 14.3: Distribution of Differences for Dibwe Topography DTM and Drill Holes	96

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Figure 14.4: Three Dimensional View of Dibwe Drill Holes Showing Inconsistency between Topography DTM and Drill Hole Collars	97
Figure 17.1: Mutanga Topographic DTM (Oct 2008)	106
Figure 17.2: Recent Drill Hole Collars, Coloured by RL difference	108
Figure 17.3: Mutanga Collars, Coloured by RL Difference	110
Figure 17.4: Raw Data Histogram Trace of Mutanga Assay Data (orange) and Gamma Data (blue) Populations	115
Figure 17.5: Raw Data Probability Plot of Mutanga Assay Data (orange) and Gamma Data (blue) Populations	115
Figure 17.6: Probability Plot of Mutanga Raw Assay and Gamma Data (>100ppm<500ppm)	116
Figure 17.7: Histogram Trace of Mutanga Raw Assay Data (orange) and Modified Gamma Data (blue)	118
Figure 17.8: Probability Plot of Mutanga Raw Assay Data (orange) and Modified Gamma Data (blue)	118
Figure 17.9: Histogram Trace of Dibwe Raw Assay Data (orange) and Modified Gamma Data (blue)	121
Figure 17.10: Probability Plot of Dibwe Raw Assay Data (orange) and Gamma Data (blue)	121
Figure 17.11: Mutanga Mineralised Domains and Drill Hole Coverage	124
Figure 17.12: Representative Mutanga Cross Section (NW-SE)	125
Figure 17.13: Representative Mutanga 3-D View	126
Figure 17.14: Dibwe Mineralised Domains and Drill Hole Coverage	127
Figure 17.15: Representative Mutanga Cross Section (NW-SE)	128
Figure 17.16: Dibwe 3D View of Mineralisation Surfaces	129
Figure 17.17: Mutanga Sample Interval Histogram	135
Figure 17.18: Mutanga MIN1 Domain Histogram (Composite Data)	138
Figure 17.19: Mutanga MIN2 Domain Histogram (Composite Data)	138
Figure 17.20: Mutanga MIN2HG Domain Histogram (Composite Data)	139
Figure 17.21: Mutanga MIN3 Domain Histogram (Composite Data)	139
Figure 17.22: Mutanga MIN4 Domain Histogram (Composite Data)	140
Figure 17.23: Mutanga MIN5 Domain Histogram (Composite Data)	140
Figure 17.24: Dibwe SE Domain Histogram (Composite Data)	147
Figure 17.25: Dibwe Central Domain Histogram (Composite Data)	147
Figure 17.26: Dibwe NW Domain Histogram (Composite Data)	148
Figure 17.27: Bulk Density Data Distribution	150
Figure 17.28: Close Spaced Drilling used for Geostatistical Analysis	152

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Figure 17.29: Close Spaced Drilling, Down Hole Variogram	153
Figure 17.30: Close Spaced Drilling, Direction 1 Variogram	154
Figure 17.31: Close Spaced Drilling, Direction 2 Variogram	154
Figure 17.32: Close Spaced Drilling, Direction 3 Variogram	155
Figure 17.33: Swath Plots MIN1	162
Figure 17.34: Swath Plots MIN2	163
Figure 17.35: Swath Plots MIN2HG	164
Figure 17.36: Swath Plots MIN3	165
Figure 17.37: Swath Plots MIN4	166
Figure 17.38: Swath Plots MIN5	167
Figure 17.39: NW-SE Cross Section Through MIN1	168
Figure 17.40: NW-SE Cross Section Through MIN2	169
Figure 17.41: NW-SE Cross Section Through MIN2HG,	169
Figure 17.42: NW-SE Cross Section Through MIN3	170
Figure 17.43: NW-SE Cross Section Through MIN4 (top) and MIN5 (bottom)	170
Figure 17.44: Swath Plots, All Domains	176
Figure 17.45: NW-SE Cross Section Through the CENTRAL and SE Domains,	177
Figure 17.46: NW-SE Cross Section Through the CENTRAL and SE Domains,	178
Figure 17.47: NW-SE Cross Section Through the SE, CENTRAL and NW Domains	178
Figure 17.48: Mutanga Resource Model Coloured by Resource Class	181
Figure 17.49: Mutanga Block Model, Coloured by U3O8 ppm	183
Figure 17.50: Dibwe Block Model, Coloured by U3O8 ppm	183

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LIST OF TABLES

Table 1.1: Mutanga Resource Estimate (December 2008)	20
Table 6.1: Previous Mutanga Mineral Resource Estimates	39
Table 10.1: 2008 Airborne Geophysical Survey Boundary Coordinates	61
Table 10.2: 2008 Airborne Geophysical Survey Specifications	63
Table 10.3: Re-Flight Specifications	64
Table 10.4: Anomalies Identified by 2005 OmegaCorp Airborne Radiometric Program	66
Table 11.1: Denison Development Drilling Statistics	69
Table 11.2: Denison Exploration Drilling Statistics	69
Table 11.3: Summary of 2008 Exploration Drilling Program	70
Table 13.1: QAQC Sample Breakdown	78
Table 13.2: List of Field Standards with Expected Values and Action Limits	80
Table 13.3: List of laboratory Standards with Expected Values and Action Limits	83
Table 14.1: Drilling Campaigns at Mutanga and Dibwe (2005)	91
Table 14.2: Proportion of Holes Located on the Ground	92
Table 17.1: Mutanga and Dibwe Summary of August 2006 Mineral Resource Estimate	101
Table 17.2: Mutanga Project – Summary of Current Resources as at December 2008	103
Table 17.3: Drilling Data Used in 2008 Modelling and Resource Estimations	104
Table 17.4: Recent Sample Data Used in Resource Estimation	105
Table 17.5: Average Elevation Difference of New Holes at Mutanga and Dibwe	109
Table 17.6: GPS Surveyed Holes Re-surveyed by DGPS	112
Table 17.7: Comparative Sample Statistics – Mutanga	114
Table 17.8: Mutanga Summary Statistics (Modified Data)	117
Table 17.9: Comparative Sample Statistics – Dibwe	120
Table 17.10: Summary Statistics of Each Drill Type	132
Table 17.11: Summary of Raw Data Contained Within Each Domain	133
Table 17.12: Descriptive Statistics by Drill Type – Mutanga	134
Table 17.13: Top-cut Analysis Performed for Each Domain	136
Table 17.14: Mutanga Domain Statistics (Composite Data)	137
Table 17.15: Dibwe Raw Data by Domain and Drill Type	141
Table 17.16: Descriptive Statistics by Drill Type (Raw Data) — Dibwe	143
Table 17.17: Top-Cut Analysis	144
Table 17.18: Dibwe Domain Statistics (Composite Data)	146

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Table 17.19: Bulk Density Data	149
Table 17.20: Variography from the MIN2 and MIN3 Domains	151
Table 17.21: Details of Variography from Close Spaced Drilling	153
Table 17.22: The Results of the Cross Validation Exercise	156
Table 17.23: Mutanga Block Construction Parameters	158
Table 17.24: Grade Estimation Search Ellipse and Sample Parameters	160
Table 17.25: Comparison of Average Composite Grades with Block Model Grades	161
Table 17.26: Wireframe Volumes Compared to Domain Block Volumes	171
Table 17.27: Comparison of Mutanga OK Model and IDW2 Model	172
Table 17.28: Dibwe Block Construction Parameters	172
Table 17.29: Grade Estimation Search Ellipse and Sample Parameters	174
Table 17.30: Comparison of Average Composite Grades with Block Model Grades	175
Table 17.31: Wireframe Volume, Compared to the Block Volume	179
Table 17.32: Comparison of Mutanga OK Model and IDW2 Model	179
Table 17.33: Updated Mineral Resource Estimates for Mutanga and Dibwe (2008)	182
Table 17.34: Mutanga Project – Summary of Current Resources as at December 2008	184

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LIST OF PLATES
Plate 7.1: Typical EGF Sequence from Bungua Prospect	45
Plate 7.2: Package A, MR09, Coarse Pyrite Nodule	47
Plate 7.3: ‘Package A’, MR09, Slump Structure in Sandstones	47
Plate 7.4: ‘Package B’, MR09, Box 7. Cross Bedding and Lamination	48
Plate 7.5: Package C, Coarse Sandstones of the EGF	49
Plate 9.1: Examples of Fault and Fracture Zones Located within the Mutanga Deposit	53
Plate 9.2: Coarse Grained for Sets Joints and Fracture	54
Plate 9.3: Localised Redox Boundaries Associated with Mud Balls and Organic Matter	54
Plate 9.4: Fractures, Iron Oxides and Clays	55
Plate 9.5: U3O8 as Agglomeration in Cavity (right) and Dissemination (left)	56
Plate 9.6: MR07 Mud Ball Replacement, Thin Near Horizontal Infill, Disseminations in Close Proximity	57
Plate 9.7: MR06 Un-replaced Mud Material (possibly large mud ball)	58
Plate 9.8: MR09 Coarse U3O8 Mineralisation within Fracture	59
LIST OF APPENDICES
Appendix 1: Examples of Core Logging Schemes and Field Sheets	201
Appendix 2: Drill Core Handling Procedure	211
Appendix 3: Down Hole Geophysics Procedure	215
Appendix 4: Gamma Probe Calibration Data (2007-2008)	218
Appendix 5: Reduced Area Boundary PL LS 237	224

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GLOSSARY OF TERMS

$	United States Dollars.
%	Percentage.
3D	Three Dimensional.
Autunite	A uranium phosphate mineral
°C	Temperature measurement in degrees Celsius (also called Centigrade).
Ca	Calcium
AGIP	Italian Oil Company AGIP SPA.
cm	Centimetre.
Brannerite	A uranium oxide mineral.
Conglomerate	A sedimentary rock made up of various sized particles from small pebbles to large boulders cemented together.
Coffinite	A uranium silicate mineral.
Cut-off	The minimum concentration (grade) of the valuable component in a mass of rock that will produce sufficient revenue to pay for the cost of mining, processing and selling it.
CRM	Continental Resource Management Pty Ltd.
CSA	CSA Global Consulting group, CSA Global (UK) Ltd.
DD	Diamond Drilling.
Denison	Denison Mines Corp.
Dilution	Waste or non economic materials included when mining ore.
Disseminated	Minerals scattered as small particles throughout a rock.
Domain	A term used mainly in ore resource estimation or geotechnical calculations to describe regions of a geological model with similar physical or chemical characteristics.

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DTM	Digital Terrain Model.
E	Easting Coordinate.
eU3O8	Equivalent U3O8.
EGF	Escarpment Grit Formation
Fe	The chemical symbol for the element iron.
Fluvial	A geological process in, or pertaining to, rivers.
Fugro/OmniSTAR	A satellite service to give sub-metre survey accuracy.
Geostatistics	A term used meaning a mathematical statistical method based on geological spatial knowledge of grade distributions to estimate grades in a systematic way.
GSZ	Geological Survey Zambia, Department of the Ministry of Mines and Minerals Development, Zambia.
hPa	Hectopascal, measure of atmospheric pressure.
HQ	Diamond Core Diameter 63.5mm.
HQ3	Diamond Core Diameter 61mm.
IDW	Inverse Distance Weighting geostatistical estimation technique.
Karoo Supergroup	Host rocks to the Mutanga uranium mineralisation. Late Carboniferous to Jurassic rocks made up of the Upper Karoo and Lower Karoo sedimentary rocks.
K	The chemical symbol for the element potassium.
kg	Kilogram.
Kt	Thousand(s) of tonnes.
kV	Kilovolt.
lkm	Lineal Kilometre.

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Log	Natural logarithm to the base 10.
LQS	Lower Quartile Solutions.
m	Metre.
m3	Cubic metre.
Massive	A term used to describe a large occurrence of a pure mineral species, often with no structure.
Meta-autunite	A uranium phosphate mineral
Micromine	Micromine is a software tool for processing of exploration and mining data.
Mineralization	The presence of minerals of possible economic value or the description of the process by which the concentration of valuable minerals occurs.
mm	Millimetre.
MMF	Madumabisa Mudstone Formation
MN	Magnetic North.
MoMMD	Ministry of Mines and Minerals Development, Zambia.
Mt	Million tonnes.
MTI	MineTech International
N	Northing Coordinate.
NCSIR	National Council for Scientific and Industrial Research a part of the USA Ministry of Science and Technology.
Neoproterozoic	The term used in the geological time scale for the period from 545 million years ago to 1000 million years ago.
NQ	Diamond Drill Bit Size 47.6mm.
OK	Ordinary Kriging
OmegaCorp	OmegaCorp Minerals Limited is a subsidiary of OmegaCorp Limited, which was an Australian Stock Exchange listed mining company that was purchased in its entirety by Denison Mines Corp. in 2007.

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Ore	A natural aggregate of one or more minerals which, at a specified time and place, may be mined and sold at a profit or from which some part may be profitably separated.
P	The chemical symbol for the element phosphorus.
PC	Personal Computer.
PL	Prospecting license.
ppm	Parts per million (same as grams per tonne).
PQ3	Diamond Drill Bit Size 83.1mm.
QAQC	Quality Assurance Quality Control.
RC	Reverse Circulation Drilling.
Redox	Lithological or stratigraphic boundaries at which reduction and oxidation reactions have occurred.
Recovery	A measure in percentage terms in the efficiency of a process, usually metallurgical, in gathering the valuable minerals. The measure is made against the total amount of valuable mineral present in the ore.
RL	Reduced Level (same as elevation coordinate).
S	South.
Sandstone	A sedimentary rock consisting of sand size grains, generally the mineral quartz, which is in a consolidated mass.
Sb	The chemical symbol for the element antimony.

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SGS	SGS Ore Test Lakefield in Perth Australia. Inspection, verification, testing and certification company.
Silica	A compound of silicon and oxygen, generally occurring in the form of the mineral quartz.
Th	The chemical symbol for the element thorium.
TN	True North.
U	The chemical symbol for the element uranium.
U3O8	Uranium Oxide.
UXO	Unexploded Ordinance
V	Logarithmic Variance.
W	West.
XRF	X-Ray Fluorescence.
ZIPRA	Zimbabwe People’s Revolutionary Army.
ZESCO	ZESCO Limited, an electricity supply company in Zambia

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Mutanga Project, Zambia — 19 March 2009

1.0 SUMMARY

Prospecting Licence PL LS 237, ‘The Mutanga Project’, formerly called the Kariba Uranium Project, is located in the Siavonga District of Southern Province, Republic of Zambia, approximately 200km south of the Zambian capital city of Lusaka. The Prospecting Licence was granted by the Ministry of Mines and Minerals Development (MoMMD) to Okorusu Fluorspar Pty Ltd on 21^st October 2004. Transferral of the PL LS 237 licence to OmegaCorp Minerals Limited (OmegaCorp) was completed on 20^th December 2005. The licence was renewed on 20^th October 2006 and again on the 6^th December 2009 for a further two years. It now covers 946.3 km² (Figure 4.1)

An application to renew the licence without any reduction for an additional 12 months until October 2009 was submitted to the MoMMD on 20 July 2008. A revised renewal application offering to relinquish 50% of the lease (i.e. to retain 946.3 km²⁾ was lodged with the MoMMD on September 17, 2008.

The Prospecting Licence authorises OmegaCorp Minerals Limited to carry out prospecting activities in respect of copper, cobalt, zinc, gold nickel and uranium for a period of two years from 6 January 2009.

OmegaCorp is a wholly owned Zambian subsidiary of an Australian registered company, OmegaCorp Limited. In turn, OmegaCorp Limited is a wholly owned subsidiary of Denison, which is listed on the TSX (Toronto Stock Exchange) and the AMEX (American Stock Exchange). Denison acquired OmegaCorp Limited in August 2007.

This report outlines work completed by OmegaCorp on behalf of Denison from 2005 to August of 2008 on the Mutanga Project.

The regional geology is dominated by the Zambezi Valley which represents a rift trough and is largely comprised of the Karoo Supergroup (Late Carboniferous to Jurassic) rocks. The uranium mineralisation identified to date appears to be restricted to the Upper Karoo Escarpment Grit Formation (EGF) of the Karoo Supergroup. The EGF sequence overlays the Madumabisa Mudstone Formation (MMF), which is interpreted to have prevented uranium mineralisation from moving further down through the Lower Karoo stratigraphy.

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The largest prospects of the Mutanga project are the Mutanga, Mutanga East, Mutanga West and Dibwe deposits. These lie completely within the Prospecting Licence PL LS 237. The Bungua prospect also lies within the PL and is in an early exploration phase with continued geological mapping, sampling and further drilling to be conducted.

The Mutanga prospects have been investigated through extensive geophysical methods, mapping, exploration and resource estimation drilling. Further work is planned in 2009 to test additional radiometric anomalies identified from two airborne radiometric surveys conducted in 2006 and 2008.

The uranium mineralisation trends parallel to bedding and has a shallow dip of 10-15° towards the southeast. Bedding and mineralisation are displaced by a series of normal faults trending northeast-southwest, parallel to the axis of the valley. In some instances, for example the eastern section of the Mutanga prospect, mineralisation is associated with normal faulting to form subvertical, planar mineralised bodies.

Major controls on mineralisation in the high grade U₃O₈ areas are interpreted to be structure and large scale fracturing. As a rule, mineralisation forms as planar bodies dipping 15-20 degrees to the south east, locally overprinted by mineralisation in oxidised steep dipping fractures. Within these zones uranium mineralisation may be disseminated through the sediments, as crystalline masses in open spaces or a selvages and cores to mud balls and flakes.

The resources defined in the exploration program, geological modelling and geostatistical processing completed to date are summarised in Table 1.1 below. The resource estimate was completed by CSA Global (UK) and the report complies with the Canadian National Instrument 43-101.

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	U3 O8
	Lower		Measured						Indicated						Inferred
	Cut-off		Tonnes		U3O8		U3O8		Tonnes		U3O8		U3O8		Tonnes		U3O8		U3O8
Deposit	(ppm)		(Mt)		(ppm)		(Mlbs)		(Mt)		(ppm)		(Mlbs)		(Mt)		(ppm)		(Mlbs)
Mutanga		100		1.88		481		1.99		8.4		314		5.82		7.2		206		3.3
Mutanga Ext*		200														0.5		340		0.4
Mutanga East*		200														0.2		320		0.1
Mutanga West*		200														0.5		340		0.4
Dibwe		100								—		—		—		17.0		234		9.0
Total				1.88		481		1.99		8.4		344		5.82		25.4		231		13.2

* Estimates for the Mutanga Extensions, Mutanga East and Mutanga West areas have not been updated since completion by CSA in 2006 and remain current.

Table 1.1: Mutanga Resource Estimate (December 2008)

The resource estimate is unchanged from the June, 2006 estimates for Mutanga East and West using a 200ppm U₃O₈ lower cut-off. Based on the results of recent mining and processing studies, the updated resource estimates for Mutanga and Dibwe are reported at a 100ppm U₃O₈ cut-off. Recent drilling at Mutanga has validated the previous historical drilling data and provided increased confidence in the U₃O₈ grade, geological interpretation and tonnage factors resulting in a significant portion of Mutanga being classified as Indicated, and a minor component of Measured Resources. The remainder of the Mineral Resource has been assigned to the Inferred category, due to the limited understanding of geological continuity, low drilling density and the uncertainty surrounding the historical radiometric methods used to determine the historical U₃O₈ grades.

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2.0 INTRODUCTION AND TERMS OF REFERENCE

The report is written to comply with the requirements of the National Instrument 43-101, “Standards of Disclosure for Mineral Properties”. It has been prepared under the supervision of and by Mr. Malcolm Titley of CSA Global on the instruction of William Kerr of Denison.

Mr Titley is the Qualified Person (QP) (as defined by the CIM Definition Standards November 22, 2005 and Section 5.1 of National Instrument 43-101 – Standards of Disclosure for Mineral Projects, Form 43-101F1 and Companion Policy 43-101CP) for the purposes of Section 19 of this Technical Report.

All historical (pre-2005) geological and sampling data provided to CSA was supplied by OmegaCorp via Continental Resource Management (CRM) in 2006. Drilling and geological data generated during the period May 2006 to December 2007 was obtained during a number of site visits to the project area by CSA. Zambia based GeoQuest Limited (GeoQuest), were responsible for the Mutanga (previously named Kariba) Uranium Project geological field activities up until the completion of recent drilling in January 2007. Denison now manages all field activities.

The resource modelling was completed under the supervision of Mr Malcolm Titley of CSA Global (UK). Specific activities completed were:

• Site visit and validation of data available for the resource estimates.

• Determination of correlation between assays and radiometrics used for U₃O₈ grade estimation.

• Compilation of updated Mutanga and Dibwe resource models. Classification of the resource models.

• Development of infill diamond and reverse circulation drill plans.

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3.0 RELIANCE ON OTHER EXPERTS

There are no disclaimers in relation to the preparation of this report.

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Mutanga Project, Zambia — 19 March 2009

4.0 PROPERTY DESCRIPTION AND LOCATION

4.1 Property Location

The Mutanga Project is located in the Siavonga District of the Southern Province, Republic of Zambia, approximately 200km south of the Zambian capital city of Lusaka.

4.2 Land Area

Prospecting Licence PL LS 237 covers approximately 946.3 km². See Figure 4.1. The original corner beacons of PL LS 237 were surveyed during November 2005. The physical boundaries of the Prospecting License were checked on the ground by Mr Amon Chisela, MoMMD Surveyor, during the period 14 to 19 September 2007. Cement beacons were erected, at the discretion of the Surveyor, as near as possible to each of the lease corner points “A” to “F” (Figure 4.1). An additional beacon survey was completed in 2007 subsequent to relinquishment by OmegaCorp when the license was renewed in October 2006.

Figure 4.1: Mutanga Project Location Plan and Geology

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4.3 Prospecting Claim Description

Denison holds the Large Scale Prospecting License – PL LS 237 in the Siavonga District of Southern Province in the Republic of Zambia. This authorises Denison to carry out exploration activities for copper, cobalt, zinc, gold nickel and uranium for a period of two years from January 6 2009. The co-ordinates of the boundaries for PL LS 237 are presented in Table 4.1(a): Appendix 5.

4.4 Nature of the Prospecting Licence

The Prospecting Licence confers on its holder exclusive rights to carry on prospecting operations in the prospecting area for the mineral specified in the licence and to do all such other acts and things that are necessary and reasonably incidental to the carrying on of such operations.

4.5 Renewal of the Prospecting Licence

The current Prospecting Licence PL LS 237 expired on October 20 2008. An extension has been granted and is valid for a period of 24 months expiring January 6 2011.

4.6 Royalties on Production of Minerals

A holder of a prospecting licence is required to pay to the Republic, a royalty on the gross value of the minerals produced under the licence at the rate of three (3) per cent.

4.7 Agreements and Encumbrances

In respect of the PL LS 237 there are no current charges, liens or other encumbrances against the Company, nor are there current threatened or pending litigious claims. The above prospecting licence is further free of any other third party claims. The project area has no known environmental liabilities as it has not been subject to any mechanised mining activities.

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5.0  ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY

The Mutanga Project area is situated in the Southern Province of Zambia about 200 km south of Lusaka immediately north of Lake Kariba with the Mutanga Prospect located 31 kilometres northwest of Siavonga. The region lies approximately between 500m to 960m above sea level with Lake Kariba situated at 485m above mean sea level.

5.1 Physiography

The project area lies within the Zambezi Rift System in the southern extremities of Zambia. The Zambezi River flows to the east of the area and follows the border between Zambia, Zimbabwe and Mozambique. The topography is defined by the geology and consists of low escarpment type hills with steep and or craggy scarp slopes and gently sloping dip slopes. In general, surface runoff flows off the ridges in a parallel pattern sometimes being fault controlled but mostly contour controlled.

The Mutanga outcrop is located approximately 39km by road from Siavonga and has an elevation of 580m above mean sea level. Dibwe elevation is between 580m to 640m above mean sea level.

5.2 Vegetation and Fauna

The vegetation of the area can be classified based on topographic and climatic factors. The dominant vegetation in the area is as follows:

• Commiphora – Kirkia thicket on lower Karoo sands

• Colophospermum mopane woodland on heavy clay soils

• Southern Isoberlinia – Brachystegia woodland on escarpment soils

• Acacia woodland on clay soils

The vegetation in the area is described as stable and has had minor effects of mainly human induced disturbances. These may include frequent dry season fires, cutting of trees for poles and fuel wood, clearing for small scale agriculture, grazing and browsing and clearing woodland for settlements.

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The area where development will occur is not currently being used for other industrial activities and only small scale subsistence farming occurs in the immediate area. There are many small villages throughout the permit area, a few located around Mutanga and Dibwe. The majority of land is wild bush land and approximately 10% of the area is under agricultural use. Subsistence arable crops are grown such as maize, sorghum and bananas.

There are no permanent large mammals in the area, though it has been noted that there are potential migration routes in the area around Lake Kariba.

There are a range of small animals in the permit such as snakes (puff adders and black mambas), lizards, ants and butterflies. There is also a large occurrence of arachnids and grasshoppers. Birds are found in the permit area including guinea fowl. There have also been sightings of banded mongoose by local people.

5.3 Climate

Climatic data was sourced from the Chipepo Meteorological Station, approximately 40km NE of Mutanga and operational between 1988 and 1997. A review of information indicated that there are gaps in the data collected, as a result the average values may not be representative of the climate for each month over the combined dataset. There are no long term data available for the potential mine site.

The climate of the area is described as tropical wet and dry with distinct wet and dry seasons. The wet-hot season is from November to March, with the highest rainfall occurring in February. The mean annual rainfall is recorded as 529mm. The dry-cool season is from April until October. There is a large variation in the temporal and regional distribution of rainfall.

During the dry-cool season maximum temperatures range from 23°C to 40°C and minimum temperatures range from 6°C to 28°C. During the wet season the maximum temperatures range from 22°C to 46°C and the minimum temperatures range from 20°C to 38°C. The highest maximum temperature that has been recorded at the site was 46°C and the lowest minimum temperature that has been recorded is 6°C.

Data collected on the wind speed indicates that winds are highest in the build up to the wet-hot season where mean wind speed ranges from approximately 5 knots up to a maximum of 7 knots. There are also marked periods of very calm days during the cold dry months (April to August). The maximum wind gusts in the wet season are from storm squalls and range from 30 knots to approximately 55 knots.

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The maximum wind and barometric pressure data is from the Lusaka Airport. The mean station level barometric pressure for Mutanga is 951hPa (this pressure is based on the mean annual barometric pressure at Lusaka and is adjusted for altitude).

No interruptions to mining activities are predicted by Denison during the wet season.

5.4 Local Resources and Infrastructure

The population is sparse and limited to small family settlements. The Kariba area is populated by the so-called “Valley Tongas” of Zambia and their main language is ChiTonga, ‘the language of the Tonga’. It is spoken by approximately 1.38 million people in Zambia and is part of the Bantu family of languages.

Approximately 600 families will have to be relocated to prior to the commencement of mining activities in the area.

The main road from Lusaka to Siavonga (the nearest town to the project site) is mostly in good condition. The Mutanga deposit site itself is located west of the main road and is currently accessed via a 48km gravel track, for which a four-wheel drive vehicle is required.

The Zyiba Meenda road will be developed for the project. This road heads east from the Mutanga site and meets the sealed Siavonga road approximately 1km south of the Lusitu River and village. This track, the Zyiba Meenda village (and other areas on the lease) were battle zones between Rhodesian regular military forces and Zimbabwe People’s Revolutionary Army (ZIPRA) freedom fighters during the period 1975 to 1979. Denison has completed two phases of demining and, at the time of writing, a third phase of demining is being completed on the Zyiba Meenda road.

Utilink, a Zambian electrical power consulting firm, has been engaged to review a suitable power supply to the Project. The most probable source of power will be from the 88kV substation at Chirundu, some 60km from Mutanga. This substation is supplied via the 330kV high voltage transmission lines from the Kariba North Bank Hydroelectricity Scheme (Figure 5.1).

Knight Piesold, a hydrogeological consulting firm from South Africa, completed test work (November 2008) to identify source(s) of water for the Project in groundwater adjacent to the future operations.

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Figure 5.1: Zambia Electrical Infrastructure

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6.0 HISTORY

6.1 Prior Ownership History

Previously the license PL LS 237 was held by Okorusu Fluorspar Pty Ltd having been granted by the MoMMD on 21 October 2004 for fuel minerals, base and precious metals and industrial minerals. The license was transferred to OmegaCorp on 20 December 2005. It was renewed on 20th October 2006, for a further two years and covered 1,893 square kilometres (reduced from 2,600 square kilometres in October 2006). Denison Mines Corp. acquired OmegaCorp Limited in August 2007. Denison is an intermediate, publicly owned, uranium mining, development and exploration company listed on the Toronto (Canada) and USA Stock Exchanges. OmegaCorp Limited is a registered Australian company and a wholly owned subsidiary of Denison.

6.2 Exploration History

Uranium was first identified in the area in 1957 after a car borne survey located five anomalous areas in the vicinity of Bungua Hill, west of Siavonga. Follow up by Chartered Exploration in 1958 and 1959 found low-grade uranium mineralisation that could be followed for over 800m of strike extent. Confirmation of this uranium mineralisation was further defined in two campaigns, after regional airborne magnetic and radiometric surveys had been flown over the area by Geometrics in 1974, via ground investigation (1973 to 1977) by the Geological Survey of Zambia (GSZ) and a second campaign (1974 to 1984) by the Italian oil company AGIP SPA (AGIP).

Prior to the current work no modern exploration had taken place in the area covered by the current PL LS 237 licence for approximately 25 years. Minimal regional exploration data or material has been located during recent work and the quality of data and materials varies greatly. The data and materials located to date comprises:

• airborne radiometric-geophysics

• ground radiometric survey data.

• regional geology maps

• topographic maps.

• Down hole geophysical gamma plots

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In 2006 11 diamond drill holes were drilled by OmegaCorp to twin previous drilling at the Mutanga Prospect. Results confirmed the broad tenor of the historical U₃O₈ intercepts. Work was also carried out at Bungua, at Mutanga and at Dibwe by OmegaCorp. During August to November, 2008 exploration drilling was completed by Denison at other prospects throughout the lease area.

During 2007 to 2008 Denison completed work on PL LS 237 including an appraisal of all available data (maps, plans, sections, limited geological interpretations and radiometrics and AGIP resource estimations). From this information Denison produced of several databases covering the Mutanga and other prospects.

For ease the PL LS 237 licence area will be discussed as five different areas largely on the basis of AGIP and the GSZ’s work, these are:

• Mutanga Prospect (Mutanga Central, Mutanga West and Mutanga East),

• Dibwe Prospect (Dibwe, Dibwe West and Dibwe North),

• Mutanga-Dibwe Area (the area of known AGIP work outside of its main ‘concentrated’ activity),

• Bungua Prospect (Kaumpwe West, Kaumpwe Central, Lutele and Chizwabowa),

• The remainder of PL LS 237.

6.2.1 Mutanga Prospect Historical Exploration

The Mutanga Prospect (Mutanga Central, Mutanga West and Mutanga East) is located approximately 31km north-west of Siavonga town and approximately 10 to 15km east of the Dibwe area see Figure 4.1. The Mutanga Prospect deposit is hosted in north-east to south-west striking braided facies units of the EGF and is thought to be fracture controlled.

Of the AGIP data (purchased by Total Zambia when AGIP pulled out of the region) of relevance to the PL LS 237 licence area, the data for the Mutanga area is the most complete and comprises, Mutanga, Mutanga West and Mutanga East, see Figure 4.1.

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Historically the Mutanga prospect appears to have been defined by:

• Outcropping mineralisation.

• Ground Radiometric Surveys

• Air-borne photographic and geophysical surveys.

Available data shows that AGIP carried out systematic exploration up to and including a resource estimation phase. This exploration activity included:

• 14,794 metres of drilling (50 diamond holes for 6833 metres, 119 percussive (wagon drill) holes for 6998 metres and 83 percussive (shallow wagon drill) holes for 963 metres.

• Trenching.

• Pitting.

• A trial heap leach facility on site and material tested at the National Council for Scientific and Industrial Research (NCSIR) facility in Lusaka.

• AGIP carried out a Kriged resource estimation using internal company classification criteria, of which little are known.

Figure 6.1 shows Mutanga prospect with AGIP drill locations, note high ground-scintillometer values shown as contours on scarp edge, possibly how the prospect was initially located.

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Figure 6.1: AGIP Diamond and Wagon Drill Hole Location Map.

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6.2.2 Dibwe Historical Exploration

The Dibwe prospect (Dibwe, Dibwe West and Dibwe North) is located approximately 10 to 15km west of the Mutanga area; see Figure 4.1. Uraniferous mineralisation in the Dibwe area appears to be hosted by meandering facies units of the EGF.

The Dibwe area has been split into Dibwe, Dibwe West and Dibwe North, see Figure 6.2. No data has been located to date for Dibwe West and North and very little for Dibwe.

Historically the prospect appears to have been defined by:

• Outcropping mineralisation.

• Ground radiometric surveys.

• Air-borne photographic and geophysical surveys.

As for the Mutanga area, available data shows that AGIP carried out systematic exploration up to and including a resource estimation phase on the Dibwe project area. This work included but was not limited to:

• At Dibwe, 40 diamond drill holes totalling approximately 3644 metres. Additional unknown number and metreage of percussive (wagon drill).

• For Dibwe, resource estimation using internal company criteria of which little is known.

• At Dibwe West approximately 70 percussive drill holes were drilled, metreage unknown. No data has yet been identified for this drilling.

• At Dibwe North approximately 20 percussive drill holes were drilled, metreage unknown. No data has yet been identified for this drilling.

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Figure 6.2: Dibwe Mineralised Domains and Drill Hole Coverage.

6.2.3 Mutanga-Dibwe Area Historical Exploration

AGIP data has been identified indicating that a regional style drill program was carried out in the broad Mutanga-Dibwe area. Historic drilling, Denison drilling and geological mapping from this work is presented in Figure 6.3.

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Dibwe-Mutanga Corridor

Figure 6.3: Dibwe — Mutanga Geological Map

It is assumed that drilling was designed as regional traverses or single holes to test:

• Ground radiometric surveys.

• Air-borne photographic and geophysical surveys.

Drilling comprised:

• 36 RDM diamond drill holes and 8 percussive holes (wagon drill) for over 7000 metres.

• Diamond holes were generally between 100 and 300 metres deep, with percussive follow up of interesting intersections.

• 30 drill holes are reported to be mineralised with either a ‘significant’ intercept given or an ‘anomalous’ description.

• In the Mutanga-Dibwe Corridor 33 holes were drilled along an approximate 8km strike length.

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• Basic geological sections from the AGIP work indicate that the mineralisation recorded along the Mutanga-Dibwe corridor was related to oxidation/reduction boundaries within the meandering facies of the EGF along strike from the main Dibwe area.

• At Dibwe 11 diamond holes were drilled to test extensions to known mineralisation, nine of which were reported as mineralised.

RDM series diamond drill hole positions are shown on Figure 6.4.

Figure 6.4: Drill Hole Location Plan RDM Series Holes Over 2006 Helicopter-borne Geophysics

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6.2.4 Bungua Historical Exploration

The Bungua prospect area is located approximately 25 km west of the Siavonga and comprises a number of prospects, Kaumpwe West, Kaumpwe Central, Kaumpwe Peak, Lutele and Chizwabowa, see Figure 6.5. Uraniferous mineralisation is hosted by the EGF. The prospect appears to have been defined by:

• Outcropping mineralisation.

• Ground radiometric surveys.

• Air-borne photographic and geophysical surveys.

The Geological Survey of Zambia carried out exploration up to and including a resource estimation phase. This work included but was not limited to:

• Approximately 6000 metres of diamond and percussive drilling (approximately 67 percussive (probably wagon) drill holes and 19 diamond drill holes).

• Non standard estimation (Geological Survey of Zambia), which has not been reproduced in this document.

Figure 6.5: Bungua Area Geology and Prospect Locations

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6.2.5 Other Activities

As a step towards nuclear fuel/energy production, the National Council for Scientific and Industrial Research (NCSIR), a part of the USA Ministry of Science and Technology, built an industrial scale trial pilot plant at its Lusaka facility. This facility was designed and constructed to test ‘ores’ from various sites in Zambia. Material from the Siavonga area is believed to have been tested in the plant. Details of this work have not been found.

Based around and probably inclusive of some shallow wagon drill holes are 22 0.75 – 1.0 metre pits at the Mutanga Prospect. It is thought that material was taken from these pits to a test heap leach at the Mutanga site and possibly to the NCSIR industrial test site in Lusaka.

6.3 Resource and Reserve History

Numerous resource estimates have been prepared, using a variety of companies, consultants and methodologies. All estimates compare favourably and demonstrate similar U₃O₈ grades and tonnages. This indicates that the resource estimate is robust. See Table 6.1.

During the 1970’s AGIP reported a polygonal estimate for the Mutanga deposit at a number of U₃O₈ cut-off’s. In October 2005 CRM estimated an Inferred Mineral Resource for Mutanga, generated by creating an ore block model within a wireframe. Blocks of 5m x 5m x 1m were created and a global in-situ dry density of 2.2 used to convert volume to tonnes. A lower cut-off of 200ppm was applied to the model. The CRM Mineral Resource estimate was used for public reports.

In April 2005, after receipt of the OmegaCorp MR diamond drilling data (twinned holes), CRM updated the resource model and Mineral Resource Estimate for Mutanga. In November 2005 project drilling and resource investigations were conducted for OmegaCorp. CRM undertook an appraisal of the AGIP data using modern standards and modelled the Mutanga Prospect according to JORC Code and guidelines. In November 2005 CRM produced an Inferred Resource estimation, according to JORC guidelines, of 6.5 million tonnes at an average grade of 375ppm above a 200ppm cut-off, with an SG of 2.2.

A resource estimation was completed in 2006 (CSA) for Mutanga, Mutanga Extensions, Mutanga East, Mutanga West and Dibwe deposit areas. The resource was estimated at a 200ppm U₃O₈ lower cut-off grade and classified as Inferred due to the limited understanding of geological continuity, low drilling density and uncertainty surrounding the relationship between the different assay and radiometric methods used to determine the sample U₃O₈ grades.

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Company Name/ Year of Resource Estimate	Category	Lower Cut		Tonnes		Grade		U3O8
		(ppm U3O8)		(Mt)		(ppm U3O8)		(Mlbs)
AGIP (1970’s)	Inferred		700		2.4		1,000		5.3
AGIP (1970’s)	Inferred		600		3.2		870		6.1
AGIP (1970’s)	Inferred		500		4.3		740		7.0
AGIP (1970’s)	Inferred		400		4.9		600		6.5
AGIP (1970’s)	Inferred		300		7.8		530		9.1
AGIP (1970’s)	Inferred		200		9.7		480		10.3
CRM Apr 2005	Indicated		200		7		400		6.2
CRM Apr 2005	Inferred		200		0.9		400		0.8
CRM Nov 2005 Deposit	Inferred		200		6.5		375		5.4
Mutanga East	Inferred		200		0.30		400		0.29
Mutanga West	Inferred		200		0.65		350		0.53
Dibwe	Inferred		200		5.00		430		4.70
	Total				12.45		396		10.92
CSA (June 2006) Deposit
Mutanga	Inferred		200		7.0		400		6.2
Mutanga Extensions	Inferred		200		0.5		340		0.4
Mutanga East	Inferred		200		0.2		320		0.1
Mutanga West	Inferred		200		0.5		340		0.4
Dibwe	Inferred		200		8.2		370		6.6
	Total				16.4		380		13.7

Table 6.1: Previous Mutanga Mineral Resource Estimates

The June 2006 resource estimates were classified as Inferred due to consistent indications of global geological and grade continuity supported by reasonable U₃O₈ variograms. In addition to the uncertainty surrounding absolute U₃O₈ grades, this resource was not considered as Indicated category due to the low confidence in the local grade estimations, the requirement for clarification on down hole gamma logger grades, the need for increased understanding of the geological controls on mineralisation, mineralogy and specific locations of the in-situ dry density determinations.

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Estimation and classification of the Mutanga and Dibwe Mineral Resource Estimates has been completed by CSA Consultants for the Mutanga and Dibwe deposits on December 31 2007 (Table 1.1).

Subsequent to the above work, Denison Mines Corp carried out drilling in both the Mutanga and Dibwe deposits to aid in conversion of the resources from Inferred to Indicated. Details of this work are provided in Section 10 of this report.

6.4 Production History

To the knowledge of all parties, the Mutanga Project has not produced any uranium ore. No on-site evidence of production has been found.

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7.0 GEOLOGICAL SETTING

7.1 Regional Geology

On a regional scale the rocks of the Karoo Supergroup (Late carboniferous to Jurassic) occupy the rift trough of the Zambezi Valley (Figure 7.1). The rifting is understood to be associated with the break-up of Gondwanaland during the Permian, followed by opening of the proto-Indian Ocean in the Jurassic; with a final episode related to the development of the East African Rift system in late Cretaceous and early Tertiary times. The significant uranium mineralisation in the area, including that of the Mutanga Project area, occurs within the Upper Karoo sandstones of the EGF.

Figure 7.1: Mutanga Project Location and Regional Geological Setting

The stratigraphic sequence is presented in Figure 7.2. The Lower Karoo Group comprises a basal conglomerate, tillite and sandstone overlain unconformably by conglomerate, coal, sandstone, carbonaceous siltstones and mudstones (the Gwembe Formation) and finally, fine grained lacustrine sediments of the MMF. The Upper Karoo sediments unconformably overlay the Lower Karoo and comprise a series of arenaceous continental sediments overlain by mudstones capped by basalt.

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Figure 7.2: Stratigraphic Sequence of Mutanga Project (Geological Survey Lusaka Office)

7.2 Local Geology

Within the tenement area the Karoo sediments lie in a northeast trending rift valley. Locally the rift valley is hilly with large fault-bounded valleys filled with Permian, Triassic and possibly Cretaceous sediments of the Karoo Supergroup. The sediments have a shallow dip and are displaced by a series of normal faults, which in general, trend parallel to the axis of the valley (Figure 7.3). Mapping of the Mutanga-Dibwe area delineated normal faults with throws of the order of 100m at intervals of between 100 and 1,500m.

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Figure 7.3: Local Geology and Geological Setting of the Mutanga and Dibwe Uranium Deposits

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Figure 7.4: Dibwe — Mutanga Geological Map

The uranium mineralisation identified to date appears to be restricted the EGF Figure 7.4.

The EGF sequence at the Mutanga deposit comprises at least 120m of sandstone and conglomerates with occasional mudstones and silts (Plate 7.1). The EGF overlies the MMF which comprises a grey to dark grey silty mudstone, with a dark red haematised layer representing either oxidising groundwater or a sub-aerial surface. The mudstone forms an impermeable unit and is thought to have prevented uranium mineralisation from moving further down through stratigraphy.

The contact between MMF and overlying EGF is between two and three metres above the dark red hematised layer.

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Plate 7.1: Typical EGF Sequence from Bungua Prospect

7.2.1 Mutanga Deposit Geology

The Mutanga Prospect is located 31km northwest of Siavonga and was defined by AGIP the largest ‘fracture-controlled’ target for exploration in the area. See surface geological map Figure 7.5.

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Figure 7.5: Surface Geology and Drilling Plan of Mutanga Deposit.

Three stratigraphic zones (“Packages”) have been identified from core logging and were utilised as geological boundaries during the resource evaluation phase at Mutanga. The stratigraphic sequence for these packages commences with Package A as the Basal Zone, overlain by Package B and Package C at the top. The three packages are detailed as the following:

1. ‘Package A’ is approximately 24m thick. Overlying the MMF, a thick, dark grey mudstone coarsening upwards into pyritic, coarse grained sandstones, Plate 7.2. Small scale slump structures (Plate 7.3) and occasional possible dewatering features are observed. Occasional iron oxides are noted. ‘Package A’ is capped by an approximately 5m thick, coarse matrix- supported conglomerate. This conglomerate marks a sudden, high energy event, possibly a channel. The sequence is thought to be representative of a prograding, possibly deltaic system.

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Plate 7.2: Package A, MR09, Coarse Pyrite Nodule.

Plate 7.3: ‘Package A’, MR09, Slump Structure in Sandstones

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2.	‘Package B’, approximately 70m thick. Overlying ‘Package A’ is a sequence of repeated fining up cycles that, as a whole, coarsen upwards. Each fining up unit starts with a very coarse grained sandstone or conglomerate and fines up to a mudstone or siltstone. The units contain a variety of sedimentary structures including trough and tabular cross bedding and laminations (Plate 7.4).
	The fining up cycles are thought to be representative of a fluvial, possibly meandering system, in which mudstones were laid down in calm lacustrine, bow lake or overbank deposits. The deposits laid down in such hiatal periods could give a series of laterally continuous deposits that could be used as marker bands. Their role in mineralisation is discussed below.
	Sulphides are observed to within an approximate depth of 50m from surface. Above this depth oxidization and weathering are evidenced by reddish brown and orange iron oxides and breakdown of micaceous and feldspathic minerals. For drill hole logging purposes, the top of the EGF Package B is taken as being the first down hole presence of mudstone.

Plate 7.4: ‘Package B’, MR09, Box 7. Cross Bedding and Lamination

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3. ‘Package C’, approximately 25m thick. Overlying ‘Package B’, is interpreted from recent drilling as the uppermost unit within the EGF in the area. ‘Package C’, although in sedimentological terms possibly related to ‘Package B’, is distinguished by grain size and structural differences. ‘Package C’ comprises bedded, generally very coarse grained sandstones with occasional conglomerates. Both sandstones and conglomerates contain less sedimentary structures than ‘Package B’ and display smaller variation in grain size with little or no cyclic variation (although individual beds can display sedimentary structures). Mudstones are generally absent, although conglomerates often contain mud balls. ‘Package C’ may represent a less ordered environment than Package ‘B’, possibly a braided channel system. Plate 7.5.

Plate 7.5: Package C, Coarse Sandstones of the EGF.

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7.2.2 Dibwe Geology

The Dibwe prospect (Dibwe, Dibwe West and Dibwe North) is located approximately 10 to 15km west of the Mutanga area; see Figure 4.1 above. Uraniferous mineralisation in the Dibwe area appears to be hosted by relatively un-faulted meandering facies units of the EGF.

The Dibwe area has been split into Dibwe, Dibwe West and Dibwe North, see Figure 7.6. No data has been located to date for Dibwe West and North and very little for Dibwe. Historically the prospect appears to have been defined by a combination of ground magnetic and airborne radiometric surveys overlain on outcropping mineralisation.

Figure 7.6: Dibwe, Dibwe West and Dibwe North Surface Geology and Drill hole Plan.

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8.0 DEPOSIT TYPES

Denison is exploring for sandstone hosted uranium deposits in the Mutanga Project area. Investigations to date suggest that these deposits are hosted within the EGF. The primary mineralisation is considered to be of the sandstone hosted fluvial channel type commonly found in the Colorado Plateau. Further detailed discussion on the mineralisation type is included in Section 9 Mineralization below and in Section 7 Geological Setting.

The exploration program going forward is aimed at improving confidence in the current Inferred Resources through targeted programs of diamond drilling in the Mutanga and Dibwe prospects. Other prospect areas will be explored by RC and diamond drilling programs to gain a broad understanding of the mineralisation styles and occurrences

Given the success of the recent helicopter-borne geophysical surveys it is planned to continue to use this exploration technique in conjunction with mapping and sampling programs to search for extensions to the known deposits.

Through this work a better understanding of the deposit type and geological model will be developed.

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9.0 MINERALISATION

It is probable that the uranium was eroded from the surrounding gneissic and plutonic basement rocks during weathering and deposition of the immature grits and sandstones. The uranium was transported together with this material in a presumably arid environment. Uranium was precipitated during reducing conditions in certain favourable units. Later fluctuations in the groundwater table caused remobilisation of this material; uranium was again dissolved and then re-deposited in reducing often clay-rich areas with a certain degree of enrichment.

Mineralisation is associated with iron-rich areas (goethite) as well as secondary uranium being distributed within mud flakes and mud balls as well in pore spaces, joints and other fractures.

The significant known uranium mineralisation within the Mutanga project occurs at various horizons within the EGF. At Dibwe it is within the upper Meandering Facies G2 unit; and at Mutanga West, Mutanga and Mutanga East it is within the lower Braided Facies G2 unit. The base of the significant mineralisation at Mutanga is about 60m above the underlying MMF. The mineralisation appears to be later than at least some of the normal faults which cut the EGF. This is evident from the good correlation of the radiometric logging data between adjacent holes within the Mutanga deposit separated by interpreted faulting.

Test work (QEMSCAN 2006) indicates that the majority of the uranium (~95%) is contained in uranium-calcite-potassium minerals such as autunite and metaautunite. Approximately 2% of the uranium bearing mineralisation by volume is attributable to brannerite and coffinite. Uranium bearing minerals exist as discrete grains; not intergrown with other minerals.

9.1 Mineralisation and Alteration

The geology of the Mutanga deposits is described in Section 7.2. Since June 2006 significant mapping has been completed in association with the recent drilling programs. The most significant geological improvement since the 2006 resource modelling, is the mapping of the near vertical fracture zones which are believed to be a major control of the distribution of mineralisation. These fracture zones are considered to be related to graben block faulting within the Karoo sandstone units. See Plate 9.1.

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Plate 9.1: Examples of Fault and Fracture Zones Located within the Mutanga Deposit.

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The controls on mineralisation mobility are dominated by features which increase permeability including fractures (Plate 9.4), bedding, joints and cross beds (Plate 9.2). Redox boundaries i.e. lithological or stratigraphic boundaries at which reduction and oxidation reactions have occurred (Plate 9.3), mud clasts and reduced rocks are important to mineralisation precipitation. These features can be recognised in iron cemented zones, micas, iron oxide layers and mud balls.

Plate 9.2: Coarse Grained for Sets Joints and Fracture

Plate 9.3: Localised Redox Boundaries Associated with Mud Balls and Organic Matter

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Plate 9.4: Fractures, Iron Oxides and Clays

The mineralization observed comprises a variety of secondary uranium minerals. The primary mineralization is considered to have been analogous to the fluvial channel deposits of the Colorado Plateau.

9.1.1 Mutanga deposit

The Mutanga deposit is the largest of the Mutanga Project deposits. It is hosted in northeast-south west trending ridge of EGF with a northwest facing scarp. The sedimentary sequence dips generally to the southeast at approximately 20 degrees. Fracturing has been identified both in outcrop and drill core and is considered to be important as a control to the mineralising process.

The mineralisation is confined to a sandstone horizon which dips to the south at about 5 degrees. Thickness and grade mineralisation are related, the higher grades occurring in conjunction with increased thickness, in broad north-south “channels” within the sandstone unit. The stratigraphy of the unit contains conglomeratic beds. The mineralisation is described as being of three types: disseminated, fracture related and mud replacement related. The majority of the mineralisation is disseminated.

Denison’s logging of 11 MR holes identified three styles of uranium oxide mineralisation, disseminated, replacement of mud (balls and flakes) and fracture hosted material. These are discussed separately in Section 7.2, although often the differing styles were found together and may have formed synchronously.

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AGIP identified that minimal vanadium mineralisation is present in association with uranium.

9.2 Mineralisation Styles

9.2.1 Disseminated U₃O₈

Disseminated U₃O₈ mineralisation occurs in sandstones, conglomerates and within mud layers,

mud balls and mud flakes. The U₃O₈ is seen as interstitial crystals of generally fine but varying size and or amorphous material to grains. The concentration of disseminations varied from a visual below 1% to approximately 5%, Plate 9.5.

Plate 9.5: U₃O₈ as Agglomeration in Cavity (right) and Dissemination (left).

Grades vary considerably between zones of disseminations, approximately 20ppm to 2052ppm U₃O₈ (geochemical) in mineralisation thought to be solely of a disseminated nature although mud replacement material may also have been contained within core and therefore not visible during logging leading to higher values.

Lithological units containing iron-oxide and uraniferous mineralisation returned moderate to high assays, as did material containing sulphides (pyrite). Samples from MR05, MR08, MR09, MR10 and MR11 contain both sulphides and micas and disseminated U₃O₈ and were expected to return low assays.

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The presence of sulphides alongside uranium oxides may indicate a transitional zone and or preferential replacement or reduction of uranium compounds by one chemical route over another (e.g. decaying organic matter over oxidation of sulphides) as uraniferous groundwater’s moved through the lithologies.

Replacement of mud material is seen in a number of drill holes, with mud balls and mud flakes contained within conglomerates and sandstones and mud layers, although mud material is not always replaced, Plate 9.6 and Plate 9.7.

Plate 9.6: MR07 Mud Ball Replacement, Thin Near Horizontal Infill, Disseminations in Close Proximity

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Plate 9.7: MR06 Un-replaced Mud Material (possibly large mud ball).

Variation is seen in the degree of replacement, from fully replaced mud balls to mud balls with a thin rime of uranium mineralisation, or wholly un-replaced mud balls and flakes. This variance may be due to, changes in ground water chemistry, differing quantities of reducing matter within the mud, fully replaced material may have been a peat like material. It may also be due to the porosity and/or soft the mud was when affected by uraniferous ground water.

Assay from samples with mud replacement returned results over a range of approximately 461ppm to 4700ppm U₃O₈ (geochemical) although this may include some disseminated material.

9.2.2 Fracture Hosted

AGIP did not conduct angled drilling during work at Mutanga even though fractures were intersected and are shown on section. OmegaCorp and Denison have drilled angled and vertical holes. The fractures intersected in core were generally steep although (rare) shallow angled fractures were logged.

Mineralisation is seen as crystal coatings on surfaces and as concentration close to surfaces. Assays results from fractures and fractured material were as high as 2745ppm U₃O₈ (geochemical), Plate 9.8.

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Plate 9.8: MR09 Coarse U₃O₈ Mineralisation within Fracture.

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10.0 EXPLORATION

Since acquiring the assets of OmegaCorp in September 2007, Denison has completed the following exploration activities:

• Airborne radiometric and magnetic survey,

• Compilation of 2005 and 2008 airborne geophysics data,

• Geological prospect mapping,

• RC and diamond drilling,

• Geological drill core and chip logging,

• Geotechnical drill core logging,

• Database updates and validation.

10.1 Geophysical Surveys

10.1.1 Helicopter-borne Geophysical Survey

During August/September 2008 a helicopter-borne geophysical survey was completed by Fugro, RSA, under the technical direction of Mr Don Carriere, Consultant Geophysicist (Figure 10.1).

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ARC1950 Datum, Z35S MEAN Botswana, Lesotho, Malawi, Swaziland, Zaire, Zambia, Zimbabwe					LATITUDE						LONGITUDE
#	X		Y		DD		MM		SS.s		DD		MM		SS.s
1		631749.00		8170015.00		16		33		03.44S		28		14		04.60E
2		628744.00		8170068.00		16		33		02.31S		28		12		23.22E
3		628936.00		8174985.00		16		30		22.29S		28		12		28.70E
4		640463.00		8186391.00		16		24		08.85S		28		18		54.96E
5		636295.00		8190157.00		16		22		07.18S		28		16		33.67E
6		653437.00		8200045.00		16		16		41.76S		28		26		09.01E
7		665000.00		8209950.00		16		11		16.78S		28		32		35.97E
8		687111.00		8210194.00		16		11		03.08S		28		45		00.27E
9		675000.00		8195000.00		16		19		20.61S		28		38		16.66E
10		670000.00		8189896.00		16		22		07.94S		28		35		29.56E
11		673609.00		8181223.00		16		26		49.15S		28		37		33.52E
12		662167.00		8174115.00		16		30		43.28S		28		31		09.60E
13		660838.00		8172381.00		16		31		40.02S		28		30		25.22E
14		653137.00		8170653.00		16		32		38.07S		28		26		05.91E
15		657905.00		8174880.00		16		30		19.43S		28		28		45.69E
16		662237.00		8177117.00		16		29		05.60S		28		31		11.20E
17		665046.00		8177546.00		16		28		50.95S		28		32		45.80E
18		668521.00		8181259.00		16		26		49.29S		28		34		41.99E
19		660380.00		8189352.00		16		22		28.02S		28		30		05.53E
20		670377.00		8197540.00		16		17		59.17S		28		35		40.25E
21		666759.00		8201301.00		16		15		57.72S		28		33		37.41E
22		658527.00		8197372.00		16		18		07.54S		28		29		01.11E
23		631749.00		8170015.00		16		33		03.44S		28		14		04.60E

Table 10.1: 2008 Airborne Geophysical Survey Boundary Coordinates

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Figure 10.1: Plan Showing Area of 2008 Airborne Geophysical Survey

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2008 Airborne Geophysical Survey Specifications
Minimum Line Length	5,000 metres
Line Spacing and Trend	100 metres at 135º
Tie Line Spacing and Trend	1,000 metres at 224º
Sensor Clearance	Dependent upon culture, terrain & Aviation Safety
Magnetic	~ 15 - 25 metres
Radiometric	~ 15 - 25 metres
Survey Area Coverage	701.4km2
Line Kilometres	9,108lkm
Data to be recorded and positional data	Horizontal magnetic gradient, radiometric
Data sampling
Magnetic	~ 2.5 metres (0.05 sec)
Radiometric	~ 50 metres (1 sec)
Altimetric	~ 5 metres (0.1 sec)
GPS	~25 metres (0.5 sec)
Magnetometer	Cs vapour, 0.005 nT
Radiometric detector	Exploranium GPX 256, 1 024 in3 down
Magnetic base station	CF1 caesium vapour - 1 sec
Navigation	Novatel 3151R real-time DGPS
Altimeter Systems	MRA MK1V and GPS
Data acquisition system	FASDAS
Field processing software	Geosoft Montaj and Oasis Montaj

Table 10.2: 2008 Airborne Geophysical Survey Specifications

10.1.1.1 Digital Products

The following products (presented in ARC1950 Datum, Zone 35S MEAN Botswana, Lesotho, Malawi, Swaziland, Zaire, Zambia, Zimbabwe) were delivered to Denison at the conclusion of the airborne geophysical survey:

• 1:25 000 Colour contour plots of the total field magnetic intensity horizontal gradient enhanced data in RTL format on CD-ROM.

• 1:25 000 Ternary RGB plots of K, U and Th in RTL format on CD-ROM.

• 1:25 000 Colour contour plots of the digital terrain (dependant upon area size) in RTL format on CD-ROM.

• 1:25 000 Colour contour plots of the magnetic first vertical derivative in RTL format on CD-ROM.

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• 1:25 000 Colour contour plots of the total magnetic intensity reduced to pole in RTL format on CD-ROM.

• Geosoft (32 bit) .GRD files images of:

• Total magnetic intensity horizontal gradient enhanced data at suitable grid cell size

• 4 channel NASVD radiometric data at a suitable grid cell size.

• Digital terrain at suitable grid cell size.

• Geosoft .GDB or .XYZ (ASCII) files of the selected data on CD-ROM

10.1.1.2 Re-flight Specifications

Diurnal	In excess of 10nT per 10 min chord for flight lines or non-linear variations of 2nT over 2 mins or 5nT over 10 mins.
Positional	A deviation in excess of 150% or less than 50% of the nominal line spacing for a distance of 2,000m or more or any gap in excess of 175%.
Navigation	If the calculated PDOP is greater than 6 or if less than 4 satellites are useable.
Altitude	In excess of a 15% deviation for 1,000m or more — dependent upon safety.
On-line magnetic data	Noise levels in excess of the following tolerances, over 1,000m or more will result in a re-flight at The Contractor’s expense.
Total Field Intensity Data:	≥ 50pT, peak-to-peak, as determined by a normalised fourth difference.
Horizontal Gradient Data:	≥ 3pT/m, peak-to-peak, as determined by a normalised fourth difference.
Radiometric	In the event that the resolution at a Thorium peak exceeds 7% the section from the previous peak with a valid resolution to the next peak with a valid resolution will be re-flown.

Table 10.3: Re-Flight Specifications

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10.1.1.3 Results Of Airborne Radiometric Surveys

As shown in Table 10.4 and Figure 10.2, the airborne radiometric programs flown by OmegaCorp in 2005 and Denison in 2008 have identified 19 exploration prospects.

Figure 10.2: Radiometric Anomalies Identified by the OmegaCorp 2005 and Denison 2008 Airborne Radiometric Surveys.

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Prospect Name
1	Mutanga Main
2	Dibwe Main
3	Dibwe Mutanga Corridor
4	Mutanga East
5	Mutanga North
6	Shante
7	Changa
8	Mulendema
9	Dibwe North
10	Dibwe West
11	Bungua North Ridge
12	Mbendele
13	Kanyama Series
14	Lufua
15	Chibote
16	Bungua
17	Zyiba Meenda
18	Kanyanga
19	Mutanga West

Table 10.4: Anomalies Identified by 2005 OmegaCorp Airborne Radiometric Program

Exploration drilling of these prospects commenced in July 2008 and continued until December 1 2008. Since then, the Project’s focus has been to complete the tasks necessary to bring the Project into production so further exploration has not been done.

10.2 Mapping

Denison geologists completed detailed geological mapping over the following prospect areas:

• Chizwabowa, Chizwabowa West — Nakwilimba,

• Dibwe, Dibwe West, Dibwe North,

• Lutele,

• Mutanga East,

Reconnaissance mapping was completed for parts of Mutanga and Mutanga North.

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These mapping exercises indicated that lithologies at Dibwe North are either MMF or the EGF. The EGF in the area can further be subdivided into ‘A’, ‘B’ and ‘C’ units. The ‘A’ unit, (base of the stratigraphic sequence), consists of mainly coarse grained, medium to poorly sorted sandstones, ‘B’ is inter-bedded sandstones and mudstones and ‘C’ is mainly composed of fine grained sandstones, with very minor or no clays/mudstones.

The MMF, in the south-western part of the area, is unconformably overlain by the EGF in the northern parts. The MMF consists of dark brownish-grey mudstones with occasional massive dark clay matrix.

At Dibwe West, the geology consists of EGF Package ‘B’ sandstones unconformably overlaying the Madumabisa Mudstones. The mudstones are exposed in the northern part while the sandstones are exposed in the southern part with the strike of almost E-W and shallow dips ranging from 10-18ºS. Overall the sandstones are coarse to fine grained but, from the logged RC chips, two distinct sandstone units can be deduced; (1) coarse to medium grained, presumably Braided Facies, and (2) medium to fine grained, presumably Meandering Facies. The sandstones are interbedded with clay or mudstone layers, mud clasts, mud balls and siltstone layers.

Mutanga East is comprised of coarse to very coarse grained sandstones that display graded bedding and medium to coarse grained cross bedded units. The sandstones are underlain by mudstones and overlain by weathered conglomeritic sandstones.

A brief geological appraisal of the Mutanga North prospect indicates that the geology is devoid of the top most lithological unit of the EGF (i.e. there is no Package C). It seems that the prospect’s geology is dominated by the EGF Package C sediments.

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11.0 DRILLING

Denison commenced reverse circulation (RC) percussion and diamond drill (DD) drilling operations on October 17, 2007 and completed this phase of work on December 1, 2008. The purpose of the drilling programs was to:

• Provide bulk sample material from the Dibwe prospect for metallurgical test work,

• Elevate the Project’s resource classification by increasing the drill hole density to:

• 50m x 50m centres at Mutanga and

• 50m x 100m centres at Dibwe Central.

• Improve the understanding of the geological models for Mutanga and Dibwe,

• Provide first pass exploration data for the radiometric anomalies identified by the 2005 and 2008 airborne geophysics programs.

All holes were logged for lithology, structure, alteration, mineralisation and geotechnical characteristics. Data was entered into DHLogger software on ruggedised tablet PCs in the field. The DHLogger data was transferred into a Fusion database.

All drill hole data was validated throughout the drilling program and as an integral component of the current recent resource estimation work. Hard copies of drill logs are stored at site.

11.1 Development Drilling

The first drilling of the Mutanga Project since Denison’s acquisition of OmegaCorp commenced on October 17, 2008 at Dibwe. The initial focus of the drilling campaign was to collect bulk sample material from the Dibwe prospect. This program continued until the onset of the rainy season in the first week of December 2007.

All rigs were relocated to the Mutanga Prospect for the 2007/08 rainy season. The objective of the program was infill drilling to consolidate the Mutanga JORC Indicated Resource. Drill hole spacing was 50 x 50m. After the end the rainy season (i.e. in April 2008), the rigs returned to Dibwe (Central) for a 50 x 100m infill program to raise the Dibwe resource estimate from Inferred to Indicated category. Development drilling was completed July 17, 2008 (Table 11.1) and the rig fleet transferred to exploration drilling (Table 11.2 and Table 11.3).

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Development Drilling Statistics
Development Drilling (October 17, 2007- December 31, 2007)	4,232m
Development Drilling (January 1, 2008 - July 17, 2008)	41,366m
Total Denison Development Drilling to end 2008	45,598m

Table 11.1: Denison Development Drilling Statistics

Exploration Drilling Statistics
Exploration Drilling (July 18 - December 1, 2008) (Includes 3,317m hydrogeology drilling)	27,341m
Total Denison Exploration Drilling to end 2008	27,341m

Table 11.2: Denison Exploration Drilling Statistics

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Prospect

Holes

Holes Mineralised

Prospect

Prefix

Drilled

> 100ppm

% Success

> 10m

> 500ppm

Hole Spacing

Recommendation

Mutanga West

MW

12

7

58

1

1

400m x 400m; then closed up

Follow up drilling

Dibwe East

DB

14

8

57

2

400m x 400m

Follow up drilling

Dibwe-Mutanga Corridor

DM

75

39

52

14

9

400m x 400m

Follow up drilling

Dibwe West

DW

34

15

44

1

400m x 400m

Follow up drilling

Mutanga East

ME

31

12

39

2

400m x 400m

Follow up drilling

Dibwe North

DN

113

35

31

400m x 400m

Follow up drilling

Bungua North Ridge

BN

15

4

27

400m x 400m; then closed up

Follow up drilling

Mbendele

MB

30

2

7

800m x 800m

Follow up drilling

Chaanga

CH

12

800m x 800m

Review results; walk away?

Shante

SH

26

800m x 800m

Review results; walk away?

Mulendema

ML

12

800m x 800m

Review results; walk away?

Mutanga North

MN

4

800m x 800m

Review results; walk away?

Totals

362

122

16

14

Does not include development drilling at the Mutanga and Dibwe prospects.

Table 11.3: Summary of 2008 Exploration Drilling Program.

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Drill hole collar plans for the Mutanga and Dibwe deposits, as at December 2008, are shown in Figures 11.1 and 11.2.

Figure 11.1: Mutanga Drill Hole Collar Plan — December 2008

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Figure 11.2: Dibwe Drill Hole Collar Plan — December 2008

11.2 Drill Collar and Down Hole Survey Data

A Topcon receiver/antenna/field controller system was purchased by Denison during 2007 to facilitate routine in-house DGPS surveying of drill hole collars. The unit communicates with the Fugro/OmniSTAR satellite service to give sub-metre survey accuracy; considered sufficient for collar surveys and development of a topography Digital Terrain Model (DTM).

During 2007 a program of high precision electronic down hole surveys was completed for the DD holes drilled at Mutanga in 2006. The survey proved that the holes’ dip and azimuth remain consistent within two or three degrees for most holes. The project database was updated with the new survey information and there was no material change to the previously issued resource statements.

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11.3 Specific Gravity

A dry bulk density range of 2.1 to 2.2 gcm³ is used, respectively based on core samples collected by OmegaCorp during 2006 from 12 PQ3 holes at Mutanga and hand specimens of the EGF.

11.4 Down Hole Geophysical Probing

Gamma logs record the amount of natural gamma radiation emitted by the rocks surrounding the drill hole. The most significant naturally occurring sources of gamma radiation are potassium-40 and daughter products of the uranium- and thorium-decay series. Clay- and shale-bearing rocks commonly emit relatively high gamma radiation because they include weathering products of potassium feldspar and mica and tend to concentrate uranium and thorium by ion absorption and exchange.

Down hole probing provides a robust equivalent U₃O₈ grade because it samples a much larger area than that of drill core or chips. The method is not affected by lost core.

During 2007 Denison purchased and implemented two complete “Mt Sopris” gamma probe systems, each consisting of gamma probe, winch, ruggedised notebook PC and software. A resistivity probe, calliper probe and spare gamma probe were also purchased.

Probes were calibrated at Grand Junction, Colorado and routinely in a test hole at Mutanga to monitor and quantify any instrument drift. Operators were trained and supported by Denison consultants on a continuing basis.

Denison’s policy at the Mutanga Project is for trained technicians to probe every drill hole immediately upon completion of drilling. Initially all holes were probed ‘open hole’ but local bad ground conditions and water flows necessitated probing be completed inside the drill string and, depending upon ground conditions, also in the open hole. Representative chips or core from the anomalous sections of holes that collapsed prior to down hole probing were sent for XRF analyses.

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11.5 Drilling Quality and Geotechnical Logging

All drill core and chips from the Denison drilling campaigns were logged for geology by competent geologists.

Geotechnical measurements were collected from drill core by trained technicians supervised by project geologists at the Mutanga core facility. The procedure is described in Appendix 2.

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12.0 SAMPLING METHOD AND ANALYSIS

12.1 Sampling

Sampling of the drill-holes for U₃O₈ content has been by the following methods:

• Down-hole radiometric logging,

• Riffle splitting RC chips,

• Half drill core.

12.2 Scintillometer Logging

All drill core and chips were systematically logged with a Terraplus RS-125 Gamma-Ray Spectrometer/Scintillometer, the data entered into DHLogger software and transferred to the Fusion database.

As detailed in Appendix 2, drill core was logged with two readings taken every 0.50 metres on each count with the results being averaged for analytical work.

12.3 Down Hole Logging

All core was logged in accordance with the procedure detailed in Appendix 2.

12.4 Diamond Core Sampling

On the basis of geological logging and scintillometer readings, mineralised intercepts from selected holes was cut with a dry diamond blade to minimise core destruction and loss of uranium mineralisation by flushing with water.

12.5 RC Drill Hole Sampling

All percussion chips were collected via a cyclone and split on site at the time of drilling. The cuttings for each metre are put through a riffle splitter to give a notional 1.5kg primary sample; a notional 1.5kg field duplicate and, depending on the hammer size, a residual bulk sample of approximately 15-20kg.

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13.0 SAMPLE PREPARATION, ANALYSES AND SECURITY

13.1 Geological Logging

Geological data collected by Denison includes the primary and secondary lithologies, grain size information, matrix type, presence of visible uranium mineralisation, weathering and hardness.

13.2 Sampling — Diamond Drilling

On the basis of geological logging and scintillometer readings, mineralised intercepts from selected holes was cut with a dry diamond blade to minimise core destruction and loss of uranium mineralisation by flushing with water. Half core was sent to Genalysis Analytical Laboratories in Johannesburg, RSA for sample preparation. Pulps were sent to Perth, Australia for analysis at Genalysis’ laboratory by pressed powder XRF methods.

13.3 Sampling — RC Percussion Drilling

Approximately 10% of anomalous intercepts (more than twice background level of Counts Per Second as determined by a hand held scintillometer) in RC holes were selected for assay. Samples of mass approximately 1.5 kg were sent to Genalysis Analytical Laboratories in Johannesburg, RSA for sample preparation. Pulps were sent to Perth, Australia for analysis at Genalysis’ laboratory by pressed powder XRF methods.

Approximately 1.5kg primary samples representing anomalous intervals of RC holes that collapsed before they could be probed were also sent for pressed powder XRF analysis.

13.4 Sample Security

RC and diamond drilling campaigns sample were shipped to Genalysis Laboratories’ Johannesburg (RSA) for preparation. Once prepared, the assay pulps were forwarded by Genalysis to its Perth, Australia assay laboratory where the samples were held in secure, quarantined storage.

13.5 Analytical Laboratories

RC and diamond drilling samples were shipped to Genalysis Laboratories’ Johannesburg (RSA) for preparation. Assay pulps were forwarded by Genalysis to its Perth, Australia assay laboratory.

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13.6 Sample Procedure and Analytical Analysis

Denison’s contracted laboratory, Genalysis Laboratory Services, dries, crushes and mills the RC and diamond core samples. Crushers are cleaned with a silica rock (waste rock) after every sample. Milling is done in ring and puck pulverisers and contamination is avoided by cleaning with compressed air and silica rock (waste rock) after every sample. With every batch of 40 samples one waste rock blank is assayed, to monitor contamination and reported as a sample.

13.7 Assay Standards

During 2006, a bulk sample of material from the outcropping ridge line mineralisation at Mutanga was sent to MinTek, RSA for the production of a set of assay standards. The standards are included as check samples when RC chips are sent for chemical analysis.

13.8 Duplicate and Repeat Sample Analysis

Denison submits duplicate samples for analysis at the ratio of one duplicate to every 19 samples. At Denison’s request, Genalysis (Perth) completed check assays on 310 reject pulps from the SGS (Johannesburg) assaying of OmegaCorp’s 2006 drilling campaign. Overall, the SGS and Genalysis results correlated well despite the fact that reject pulps were used rather than the assay pulps (the original assay pulps had been disposed of). Nine of the 310 samples showed inconsistencies; i.e. +100ppm U₃O₈ from one lab reported as <<100ppm U₃O₈ by the other. Statistically this is within expectations considering the ‘nuggetty’ nature of the mineralisation.

Down hole gamma probing of all holes commenced with Denison’s drilling program in October 2007. Validation of the gamma probe (i.e. eU₃O₈ grades against XRF determinations by Genalysis) is detailed in Section 17.3, Figure 17.4 and Figure 17.7.

These were submitted as two sample batches for analysis in May 2008 from the recent 2007-2008 drilling campaign. The results of this validation is discussed in Section 17.3. Internal and external QAQC samples were included in the analysis, including field duplicates, field standards, field blanks and laboratory standards.

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13.9 Quality Control Procedures

A total of 91 samples underwent assay at SGS for QAQC analysis. These were submitted as two sample batches for analysis in May 2008 from the recent 2007-2008 drilling campaign. They included field duplicates, field standards, field blanks and laboratory standards.

The table below (Table 13.1) summarises the numbers of samples submitted and their proportion as percentages and ratios of the total number of assays submitted.

	Number of		% of Total
QAQC Sample/Assay Type	Samples*		Samples			Ratio
SGS Standard Samples		11		0.83	%		1:120
Omega Standard Samples		15		1.13	%		1:88
Omega Blank Samples		38		2.86	%		1:35
Omega Field Duplicate Samples		27		2.03	%		1:50

* QAQC conducted on holes drilled in 2007-2008. Total number of samples from drill holes drilled in 2007-2008 was 1,327.

Table 13.1: QAQC Sample Breakdown.

13.9.1 Field Duplicates

There is a reasonable correlation between primary samples and their duplicates submitted by Denison. There is a general trend towards the under reporting of duplicates relative to their primary value as can be seen from where the points plot relative to the x=y line. However, 93% of duplicate samples submitted were below 100ppm U₃O₈ and therefore, moderate and higher grades are not well represented.

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Figure 13.1: Field Duplicate Scatter Plot

Three outliers lie significantly off the x=y line (Figure 13.1). All samples were taken from drill core and the effect may account for these outliers. It should be noted that the duplicate dataset contains few samples and as such, conclusions from statistical comparison are somewhat limited, suffice to say there appears to be no significant issues with duplicate repeatability, although it is highly recommended that in future drilling campaigns, the assay QAQC database is significantly increased, to a ratio of 1:20 rather than the current 1:50 and that QAQC samples are representative both of the grade distribution at each deposit/prospect and that sampled material is spatially representative of each prospect/deposit.

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13.9.2 Field Standards

Four field standards (low grade, medium grade, high grade and very high grade) were submitted to SGS for analysis to assess the level of confidence that can be applied to returned assay data from samples submitted in Denison’s recent drill sampling campaign. These are Certified Reference Materials (CRM) of which expected values and 95% confidence limits (low, high) are listed in Table 13.2.

									Data
	Number		Expected		Upper		Lower		Between			Beyond
Name of	of		Value		Action		Action		Action			Action
Standard	Samples		(ppm)		(ppm)		(ppm)		Limits			Limits
UREM 3		5		439		455		423		40	%		60	%
UREM 4		4		100		115		85		100	%		0	%
UREM 5		5		775		792		756		0	%		100	%
UREM 6		5		1887		1925		1867		0	%		100	%
Total		19								32	%		68	%

Table 13.2: List of Field Standards with Expected Values and Action Limits

UREM 3/SARM 23 is a moderate grade standard (expected value 439ppm). There is a trend towards over reporting of this standard. All five samples report over the expected value, with three outside of the action limits (Figure 13.2).

UREM 4/SARM 24 is a low grade standard (expected value 100ppm). Four samples were submitted and all performed well, returning values within the action limits close to the expected value (Figure 13.3). This is the grade range for which most duplicates were submitted.

UREM 5/SARM 25 was a moderate to high grade standard with an expected value of 775ppm. Four samples were submitted and all were above the 95% upper action limit, assaying on average 10% above the certified value (Figure 13.4).

UREM 6/SARM 26 (expected value 1887ppm) also performed poorly. Five samples of this standard were submitted and four over-reported above the 95% upper action limit and one underreported significantly by over 10% (Figure 13.5).

Control plots are plotted against Batch ID and therefore time. In cases where cyclical patterns of assays against Time can be seen in control plots for standards, it can commonly be attributed to analytical drift where assays report closer to their expected values when the analytical equipment is re-calibrated and drift further from their true values between calibrations. However, without consultation with the laboratory addressing the reasons for cyclicity, this cannot be confirmed.

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In future campaigns, assay QAQC should be monitored on an ongoing basis and any cyclicity evident in the data should be investigated with the laboratory.

Figure 13.2: Control Plot for Denison Field Standard UREM3/SARM23

Figure 13.3: Control Plot for Denison Field Standard UREM 4/SARM 24

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Figure 13.4: Control Plot for Denison Field Standard UREM 5/SARM25

Figure 13.5: Control Plot for Denison Field Standard UREM 6/SARM26

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									Data
	Number		Expected		Upper		Lower		Between			Beyond
Name of	of		Value		Action		Action		Action			Action
Standard	Samples		(ppm)		(ppm)		(ppm)		Limits			Limits
UREM 3		2		439		455		423		0	%		100	%
UREM 4		2		100		115		85		50	%		50	%
UREM 5		2		775		792		756		0	%		100	%
UREM 6		1		1887		1925		1867		0	%		100	%
Total		7								10	%		90	%

Table 13.3: List of laboratory Standards with Expected Values and Action Limits

Figure 13.6: Control Plot for all Internal Laboratory Standards

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Figure 13.7: Control Plot for All Internal Laboratory Standard UREM3

Figure 13.8: Control Plot for All Internal Laboratory Standard UREM4

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Figure 13.9: Control Plot for All Internal Laboratory Standard UREM5

Figure 13.10: Control Plot for All Internal Laboratory Standard UREM6

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13.9.3 QAQC Conclusions

Conclusions from the assay QAQC analysis of the 2007-2008 drilling campaign are;

• Blanks submitted by Denison all performed very well with all samples reporting below detection. This suggests that field sampling methods and contamination-limiting procedures at SGS are adequate.

• Results from the submission of external field standards was mixed. On average, two out of every three samples reported within ±10% of their expected values. The aim should be to increase this number and in future drilling campaigns, should any samples fall outside the action limits (±95% confidence levels, the cause should be investigated and resolved by re-assaying the same sample and/or reviewing field and laboratory procedures.

• Results from internal standards (UREM standards) were poor overall (Figures 13.6 to 13.10 and Table 13.3). Six out of seven standards reported within ±10% of their certified values, but the average percentage error was 11% outside the expected value. This issue should be raised with the laboratory and the samples re-assayed to ensure results are accurate.

• Although not available at the time the QAQC review was completed, at the time of reporting, spreadsheet data for additional internal laboratory standard reference material, blanks and duplicate samples was received and reviewed. This data suggests internal laboratory QAQC practises to be adequate. Ongoing monitoring of internal laboratory control alongside external control is highly recommended as part of future drilling programs and should be implemented as a matter of course. A set of pulp duplicates should be submitted to an umpire laboratory which can then be analysed alongside SGS samples, also testing laboratory precision.

• The number of QAQC samples submitted overall was low and it is advisable that in future drilling campaigns, this number should be increased to be more representative. It is highly advisable that, as a matter of course, QAQC data should be analysed concurrently with drilling. By doing this, if issues arise, it allows for the laboratory to be consulted, samples re-assayed and procedures reviewed if necessary, resulting in problems being resolved at the time and prevented for the rest of the campaign.

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14.0 DATA VERIFICATION

14.1 Quality Control Procedures

No detailed QAQC data is available to validate the historical drilling. A comprehensive QAQC program must be completed during the next phase of drilling. CSA are comfortable that if the overall grade distribution of the infill drilling compares favourably with the historical drilling, then the use of the historical data in future resource updates can be justified.

All uranium exploration technical information is obtained, verified and compiled under a formal quality assurance and quality control program in Zambia. The following details the protocols used by all Denison staff and consultants.

14.1.1 Processes for Determining Uranium Content by Gamma Logging

Exploration for uranium deposits in Zambia typically involves identification and testing of sandstones within reduced sedimentary sequences. The primary method of collecting information is through extensive drilling (both Reverse Circulation and Diamond Drill coring) and the use of down hole geophysical probes. The down hole geophysical probes measure natural gamma radiation, from which an indirect estimate of uranium content can be made.

The radiometric (gamma) probe measures gamma radiation which is emitted during the natural radioactive decay of uranium. The gamma radiation is detected by a sodium iodide crystal, which when struck by a gamma ray emits a pulse of light. This pulse of light is amplified by a photomultiplier tube, which outputs a current pulse. The gamma probe is lowered to the bottom of a drill hole and data is recorded as the tool is withdrawn up the hole. The current pulse is carried up a conductive cable and processed by a logging system computer which stores the raw gamma cps data.

If the gamma radiation emitted by the daughter products of uranium is in balance with the actual uranium content of the measured interval, then uranium grade can be calculated solely from the gamma intensity measurement. Down hole cps data is subjected to a complex set of mathematical equations, taking into account the specific parameters of the probe used, speed of logging, size of bore hole, drilling fluids and presence or absence of and type of drill hole casing. The result is an indirect measurement of uranium content within the sphere of measurement of the gamma detector.

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The basis of the indirect uranium grade calculation (referred to as “e U₃O₈ “ for “equivalent U₃O₈”) is the sensitivity of the sodium iodide crystal used in each individual probe. Each probe’s sensitivity is measured against a known set of standard “test pits,” with various known grades of uranium mineralization, located at the U.S. Department of Energy’s Grand Junction, Colorado office. The ratio of cps to known uranium grade is referred to as the probe “K-Factor,” and this value is determined for every gamma probe when it is first manufactured and is also periodically checked throughout the operating life of each probe. In addition, certain boreholes at the Mutanga property are cased and the probes are periodically checked for any instrument drift. Application of the K-Factor, along with other probe correction factors, allows for immediate grade estimation in the field as each drill hole is logged.

14.1.2 Core Sampling, Processing and Assaying

Core and reverse circulation chip samples are collected for a number of purposes in addition to purely geological reasons: verification of lithology as determined from geophysical logging and examination of drill cuttings if RC; determination of uranium content as a general check of gamma probing to determine if gamma measurement and chemical uranium content are close to balance (this is referred to as “radiometric disequilibrium”); whole rock analysis; and specific geochemistry for uranium species and other minerals of interest. Core diameter is typically 76mm. For zones selected for laboratory analyses, one half of the core will normally be used and the other half retained. The minimum length of core submitted is usually 0.2 metres and the maximum length per sample is 0.4 metres. Sample intervals are selected by geologists in the field based on lithology, oxidation/reduction and uranium grade (from gamma logging and from hand-held gamma counters).

Samples are analyzed at the Genalysis Laboratory Services PTY LTD (“Genalysis”) in Perth, Australia. Samples are transported in a dedicated truck from Zambia to Johannesburg, where Genalysis operates a dedicated sample preparation facility. The sample is crushed, pulped and homogenized and a sample pulp is air freighted to the lab in Perth, Australia.

This laboratory has been in operation since 1975 and now processes over 1,000,000 samples per year. It is fully certified and accredited by Australian standards. Genalysis is an accredited NATA (National Association of Testing Authorities, Australia) laboratory (Number 3244). Genalysis has been approved by AQIS (Australian Quarantine and Inspection Service) for the receipt and treatment of samples from interstate and overseas. Genalysis is an Associate Member of the Association of Mining and Exploration Companies Inc. and a Member of the Standards Association of Australia.

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14.1.3 Quality Assurance and Quality Control Measures

Drill hole logging is conducted by trained and dedicated personnel devoted solely to this task. The tools and a complete set of spares, were manufactured by Mount Sopris Instrument Company in Golden, Colorado and were shipped to Zambia in 2007, ahead of the drilling season. Denison has retained the services of a senior geophysical consultant, an expert in down hole geophysical probing for uranium, to oversee training, implementation and quality control protocols with the Zambian logging personnel. All tools were checked and calibrated before being shipped to Zambia and a variety of system checks and standards have also been established for routine checking and calibration of tools. In addition, Denison cased a mineralized hole at one of its centrally located exploration areas and this cased hole was logged periodically to ensure exact repeatability of the gamma probes.

Drill hole logging data is stored on digital media in the logging truck at the exploration sites. The digital data are periodically brought in from the field locations to the Lusaka office. The raw and converted logging data are copied and then sent via e-mail to Denison’s Saskatoon office, where all data is checked and reviewed.

Samples of drill core are chosen on the basis of radiometric data collected during core logging. This radiometric data is obtained by using a hand-held scintillometer and on the basis of subsequent down hole probing. The general concept behind the scintillometer is similar to the gamma probe except the radiometric pulses are displayed on a scale and the respective count rates are recorded manually by the geologist logging the core. The hand-held scintillometer provides quantitative data only and cannot be used to calculate uranium grades, however, it does allow the geologist to identify uranium mineralization in the core and select intervals for geochemical sampling.

Additional samples are collected above and below the horizons of interest in order to “close-off” sample intervals. Sample widths are selected according to radiometric values and lithologic breaks or changes. All reasonable efforts are made to ensure that splitting of the core is representative and that no significant sampling biases occur. Once the sample intervals are identified, an exclusive sample number is assigned each interval and recorded by the on-site geologist.

After the geological logging of the core and sample selection, all of the selected sample intervals of drill core are split longitudinally at the drill site. One half of the core is placed in a new sample bag along with a sample tag corresponding to the sample number. The other half of the core is re-assembled in the core box and stored for future reference. Samples are transported by dedicated truck transport and delivered to Genalysis for preparation. As standard procedure, field duplicates are included in assay suites sent to the laboratory and reference samples are used to verify laboratory controls and analytical repeatability.

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14.2 Survey Control

All recent survey control has been set up using the UTM Coordinate: Arc 1950 Map Datum, Zone 35S. Historical survey control was completed by Datum Surveying Consultants, from Lusaka, Zambia. Denison has a high precision GPS system which has been used for all recent work. The absolute elevation datum for the area is yet to be accurately determined. Until this datum is established, the elevation datum as estimated by the Denison DGPS system has been used. This datum is on average 8m lower that the previously used historical datum. As a result all historical data has been adjusted in elevation to fit the current Denison datum.

14.3 Drill Hole Location

By 2005, several phases of drilling data covered the Mutanga and Dibwe areas (Table 14.1) and not all historical holes could be identified in the field.

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	Hole	Num		Metres
Deposit	Prefix	Holes		Drilled			Comments
Mutanga	DD		65		6,908.1		AGIP Diamond holes
	MR		11		650.2		Omega 2005 Twinned Diamond Holes
	SWD		83		974.0		AGIP Short Wagon Percussion Holes
	WD		124		7,238.0		AGIP Wagon Percussion Holes
Sub-Total			283		15,770.3
Mutanga	DD		4		547.1		AGIP Diamond holes
	WD		23		1,361.0		AGIP Wagon Percussion Holes
Mutanga	DD		1		146.0		AGIP Diamond hole
	WD		7		420	*	AGIP Wagon Percussion Holes (*final depths estimated)
Sub-Total			35		2,474.1
Dibwe	DDH		40		5,255.4		AGIP Diamond holes
	WD		134		13,400.0		AGIP Wagon Percussion Holes (depths assumed to be 100m)
	RMD		36		6,796.5		GSZ Regional Diamond Drill holes (some depths not certain)
Sub-Total			210		25,451.9
TOTAL			528		43,696.3

Table 14.1: Drilling Campaigns at Mutanga and Dibwe (2005)

The collar positions were determined in several stages. The first stage was to locate drill holes with identifiers in the field. The located drill hole coordinates were then used to geo-reference the AGIP drill hole location plan. The geo-referenced plan was used to produce a coordinate list for the remaining drill holes. The geo-referenced coordinates were used to find the remaining drill holes. As more holes were located, a second phase of geo-referencing took place to make the coordinate set more accurate. Drill holes were then marked, where found if located, or at the coordinate position if not located. A permanent peg was placed in the ground to mark these positions. All positions were surveyed with DGPS.

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The proportion of located and not located holes is presented in Table 14.2.

	Hole	Num		Holes		%
Deposit	Prefix	Holes		Located		Located			Comments
Mutanga	DD		65		25		38	%	AGIP Diamond holes
	MR		11		11		100	%	Omega 2005 Twinned Diamond Holes
	SWD		83		1		1	%	AGIP Short Wagon Percussion Holes
	WD		124		45		36	%	AGIP Wagon Percussion Holes
Sub-Total			283		82.0		29	%
Dibwe	DDH		40		20		50	%	AGIP Diamond holes
	WD		134		68		51	%	AGIP Wagon Percussion Holes
	RMD		36		0		0	%	GSZ Regional Diamond Drill holes
Sub-Total			210		88.0		42	%
TOTAL			493		170.0		34	%

Table 14.2: Proportion of Holes Located on the Ground

Further discussion on drill collar and down hold survey data is provided in Section 11.

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14.4 Down Hole Surveys

Historically, all holes were drilled vertically. No down hole survey data is available for historic drilling prior to Omega and Denison drilling campaigns. However, the amount of deviation is considered to be negligible because:

• Hole diameters are relatively large indicating large diameter drill rods with limited flexibility;

• Holes are relatively shallow with depths averaging 40m and ranging from 10 to 110m; and

• Bedding is relatively flat and rock competency low.

Omega drilling up until 2006 and Denison’s 2007-2008 drilling campaign consisted of diamond and reverse circulation drilling, predominately drilled vertically, along with some inclined holes. Limited checks on hole deviation demonstrated deviations of less than 2 degrees. All diamond holes were drilled at angles ranging from 55 to 80 degrees and at a number of azimuths although dominantly towards 135 or 315 degrees. Down hole survey measurements were taken using a single shot camera at 15m down hole intervals.

14.5 Surface Topography Validation 2007

Digital topographic data was supplied by New Resolution Geophysics (NRG), based in South Africa. NRG completed an air borne helicopter geophysical survey in May 2006. As part of that survey topographic elevation points were generated on a 20m x 20m regular grid. This grid was extensive and covered the current resource areas adequately. For both the Mutanga and Dibwe deposits the relevant portion of the topographic grid was extracted and converted into a digital wireframe surface. Due to the elevation datum change (Section 14.3) the wireframe topography surface was warped to fit the surveyed drill hole collar elevations of the Omega 2006 — 2007 data. All historical drill collars were then registered onto the “new” topographic surface and adjusted to fit precisely.

CSA recommend at the time that a correct regional elevation be established for the area and a detailed photogrammetric aerial survey be flown over the project areas to produce surface contours to +/-0.5m accuracy. The resulting DTM could then be used to correct drill hole collar elevations. An accurate topography DTM will be required for the production of accurate infrastructure and other mining related plans.

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The data was provided in UTM Arc 1950, Zone 35S coordinates. The absolute elevation of this data is not accurate but the relative topography profile after adjustment using drill hole collar data was considered reasonable for the purposes of resource estimation at that time.

The wireframe topography surface was compared to the surveyed drill hole collar elevations and the difference recorded.

14.5.1 Mutanga Digital Topography Model 2007

Comparison of the Mutanga drill hole collar surveyed elevation coordinates with the NRG topography wireframe showed an average difference of 2.2m after removing obvious outliers. The topography wireframe was adjusted accordingly by subtracting 2.2m from the Z coordinate. The distribution of differences between drill hole collar elevations and the topography DTM after adjustment is presented in Figure 14.1.

Figure 14.1: Distribution of Differences For Mutanga Topography DTM And Drill Holes

The mean of difference (after DTM adjustment) was close to zero but the variance ranges from -5 to +5 metres. The biggest differences occurred in areas of relatively steep or strongly vegetated topography. An example of the +ve differences after the DTM had been adjusted by the mean difference is shown in Figure 14.2. The differences were due to a combination of holes that were not yet accurately DGPS surveyed and the inaccuracies associated with air borne geophysical topographic survey methods.

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Figure 14.2: Three Dimensional View of Mutanga Drill Holes Showing Inconsistency between
Topography DTM and Drill Hole Collars

14.5.2 Dibwe Digital Topography Model 2007

Comparison of the Dibwe drill hole collar surveyed elevation coordinates with the NRG topography wireframe showed an average difference of 7.4m after removing obvious outliers. The topography wireframe was adjusted accordingly by subtracting 7.4m from the Z coordinate. The distribution of differences between drill hole collar elevations and the topography DTM after adjustment is presented in Figure 14.3.

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Figure 14.3: Distribution of Differences for Dibwe Topography DTM and Drill Holes

As for Mutanga, the mean of difference (after DTM adjustment) was close to zero but the variance ranges from -3 to +3 metres. The biggest differences occurred in areas of relatively steep or strongly vegetated topography. An example of the positive differences, after the DTM has been adjusted by the mean difference, is shown in Figure 14.4. The differences were due to a combination of holes that were not yet accurately DGPS surveyed and the inaccuracies associated with air borne geophysical topographic survey methods.

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Figure 14.4: Three Dimensional View of Dibwe Drill Holes Showing Inconsistency between
Topography DTM and Drill Hole Collars.

CSA recommend that a detailed photogrammetric aerial survey be flown over the resource areas to produce surface contours to +/-0.5m accuracy. The resulting DTM could then be used to correct drill hole collar elevations. An accurate topography DTM will be required for the production of accurate infrastructure and other mining related plans.

In Q1 2008 OML contracted Geoscientific Mineral Resources to collect and supply a bundle of IKONOS satellite data. Data received included:

• Digital elevation model (DEM) with 100m, 50m, 25m, 10m, 5m and 1m contours.

• 1m True Colour Images.

• 1m Multispectral Images.

• 1m Panchromatic Images.

• Combined IKONOS and LANDSAT imagery (to increase the spectrum from 4 bandwidths to 7 bandwidths for easier land use distinction).

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14.6 Drill hole Recovery

The initial appraisal of AGIP data had highlighted significant core losses during drilling. In an attempt to reduce core loss problems during drilling, PQ diameter was generally used for the top sections of drill holes, with the diameter then being reduced to HQ and occasionally NQ. Although core losses were still encountered in weak conglomeritic, mudstone material and in areas of fracturing, slow penetration and telescoping of drill holes is thought to have reduced the possible effects.

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15.0 ADJACENT PROPERTIES

The subject of this report is the current resource estimate of the individual deposits contained within the Mutanga Project area. Discussion of adjacent properties is outside the scope of this report and is not considered material.

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16.0 MINERAL PROCESSING AND METALLURGICAL TESTING

Bench scale test work was carried out by Denison at SGS Ore Test Lakefield in Perth, Western Australia in 2007. The test program was developed to:

• develop the optimal leach parameters;

• establish grindability characteristics of the plant feed;

• establish downstream process performance, e.g. settling and filtration assessments; and

• establish ion exchange performance.

The test material consisted of drill core samples from the Mutanga and Dibwe prospects. Samples consist of PQ3 (83.0mm) or HQ3 (61.1mm) diameter drill core. The net weight of the core despatched is 7,826kg, comprising 5,851.4 from Mutanga (including 1,262kg waste for pilot plant commissioning) and 1,975kg from Dibwe.

Mutanga samples were collected October 2006 and are either full core or have been cut for sampling (either a 1cm sliver sample or half core). Dibwe samples were collected between October — December 2007 and are full PQ3 or HQ3 core.

Metallurgical testing has shown the ore to be amenable to environmentally friendly alkali leaching at coarse grinds with rejection of barren scats from the grinding circuit. The results of the test work were favourable and indicated that U₃O₈ recoveries above 85% could be achieved through an alkali leach process at elevated temperatures, followed by solid-liquid separation and ion-exchange to produce a uranium concentrate.

Further bench scale test work is currently underway to further refine the process parameters in preparation for a pilot plant campaign.

Test work investigating the potential of acid heap leach is also in progress as an alternate processing methodology.

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17.0 MINERAL RESOURCE ESTIMATES

17.1 Mineral Resource Overview and Summary

A previous Mineral Resource estimate and JORC compliant public report including the Mutanga and Dibwe deposits was published by previous owners OmegaCorp (previous ASX listed company) on the ASX website (Titley, M. and Williams, D., November 2006).See Table 17.1.

OmegaCorp — Kariba Uranium Deposits - Zambia

Mineral Resource Estimate 29 August 2006

	Inferred		U3O8		U3O8
Deposit	Tonnes		(ppm)		(lbs)
Mutanga		7,000,000		400		6,200,000
Mutanga Extentions		500,000		340		400,000
Mutanga East		200,000		320		100,000
Mutanga West		500,000		340		400,000
Dibwe		8,200,000		370		6,600,000
Total		16,400,000		380		13,700,000

(Lower Cut-off grade of 200ppm U₃O₈)

Table 17.1: Mutanga and Dibwe Summary of August 2006 Mineral Resource Estimate

Infill drilling at the Mutanga and Dibwe deposits was completed during 2007 and 2008. An updated resource estimate, classified according to the CIM Definitions Standards, for the Mutanga and Dibwe deposits has been completed. This new resource estimate is described in this section.

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It should be noted that an update of resources for the Mutanga Extensions, Mutanga East and Mutanga West areas has not been completed as part of this study and there is no new data for these areas. Therefore, the resource estimates quoted in the 2006 Scoping Study Report remain current. For additional information relating to these resources areas and the methodologies employed to estimate resources, the reader is referred to the 2006 report.

Data manipulation, database creation, modelling and grade estimation was undertaken using Micromine v11 software. 3D block models for both deposits were converted to Datamine Studio format for use in resource optimisation studies, to be carried out by LQS (Perth) and which was underway at the time of writing this report.

During the resource estimation process, to ensure compatibility between Micromine and Datamine, all northing coordinate data was truncated, dropping the first digit. Therefore, a value of 8,000,000 is removed from the northing coordinate. Throughout this section of the report, northing coordinate data is given as truncated coordinates. 3D views shown in figures in this section of the report have had a 3× vertical exaggeration applied, unless otherwise stated.

New data (largely drilling data) was reviewed and validated before being merged with existing data for use in the new resource estimation. The geological and grade models for both deposits were reviewed and the geometry of historically defined mineralised domains improved via the 2D and 3D modelling of a significantly larger dataset than was available in previous resource estimations.

The statistical characteristics of domain data at both deposits were reviewed. Data suitable for inclusion in resource estimation work was flagged prior to the construction of variograms to investigate spatial grade continuity at both deposits. This provided input parameters for the grade interpolation process. 3D block models were created for both deposits constrained to mineralised domains. Grade interpolation into the block models on a domain by domain basis was undertaken using Ordinary Kriging (OK) and validated using the Inverse Distance Weighting (IDW) interpolation technique.

The resource models for both deposits were then validated. The 2008 Mineral Resource estimate for Mutanga and Dibwe is detailed in Table 17.2. CIM Definitions Standards 2005 have been applied for the classification of these Mineral Resource estimates.

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	U3O8
	Lower		Measured						Indicated						Inferred
	Cut-off		Tonnes		U3O8		U3O8		Tonne		U3O8		U3O8		Tonne		U3O8		U3O8
Deposit	(ppm)		(Mt)		(ppm)		(Mlbs)		s (Mt)		(ppm)		(Mlbs)		s (Mt)		(ppm)		(Mlbs)
Mutanga		100		1.88		481		1.99		8.4		314		5.82		7.2		206		3.3
Mutanga Ext*		200														0.5		340		0.4
Mutanga East*		200														0.2		320		0.1
Mutanga West*		200														0.5		340		0.4
Dibwe		100								—		—		—		17.0		234		9.0
Total				1.88		481		1.99		8.4		344		5.82		25.47		231		13.16

Resources for Mutanga Ext, Mutanga East and Mutanga West have not been updated in 2008 and remain current.

Table 17.2: Mutanga Project — Summary of Current Resources as at December 2008

17.2 Input Data

17.2.1 Drilling Data

The existing project data base was combined with new drilling data from the 2007 and 2008 infill drilling program. All data was validated and converted to Micromine format. This process ensured a single validated database was available for resource estimation.

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The types of drilling data available for use in modelling and resource estimation are presented in Table 17.3 and Table 17.4. This data comprises historical data collected prior to Omega’s involvement and recent drilling data from Omega and Denison drilling campaigns between 2005 and 2008.

Deposit	Hole Prefix	Holes		Drilled (m)		Comments
Mutanga	DD		65		6,908.8	AGIP Diamond holes
	MR		11		650.2	Omega 2005 Twinned Diamond Holes
	SWD		83		974.0	AGIP Short Wagon Percussion Holes
	MWD		124		7,238.0	AGIP Wagon Percussion Holes
	MRC		71		2,052.0	Omega 2006 RC holes
	MTDH		12		465.9	Omega 2006 PQ Metallurgical Diamond Holes
	MDH		16		1,001.6	Omega 2006 HQ and PQ Geological Diamond
	MTC		211		11,494.27	Denison 2007-08 infill RC holes
	MTD		217		12,513.32	Denison 2007-08 infill Diamond Holes
	MGSC		28		1032.00	Denison 2007-2008 Geostatistical RC holes
	MGSD		16		566.07	Denison 2007-2008 Geostatistical Diamond holes
Sub-Total			854		44,896.16
Dibwe	DDH		40		5,255.4	AGIP Diamond holes
	DWD		134		13,400.0	AGIP Wagon Percussion Holes (depths assumed to
	RMD		25		3,804.7	GSZ Regional Diamond Drill holes (depths not
	DRC		25		1,362.0	Omega 2006 RC holes
	DWRC		8		608.0	Dibwe West Omega 2006 RC holes (not used for
	DBC		89		5,547.45	Denison 2007-2008 infill RC holes
	DBD		165		14,492.09	Denison 2007-2008 infill Diamond holes
Sub-Total			486		44,469.64
TOTAL			1340		89,365.80

Table 17.3: Drilling Data Used in 2008 Modelling and Resource Estimations.

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In addition to the historical data discussed in Section 6, assay and gamma data from the recent 2007-2008 drilling campaign was checked for errors. Validated drilling information is included in Table 17.4. Data which could not be validated has been excluded from the resource estimate.

	Hole					XRF assays				Gamma Readings
Deposit	Prefix	Holes		Metres Drilled		Num		m		Holes		Records*
Mutanga	MTC		211		11,494.27		23		526.00		193		93,400
	MTD		217		12,513.32		21		468.00		206		10,864
	MGSCC		28		1032		0		0		28		9,601
	MGSD		16		566.07		0		0		15		4,707
Sub-Total			472		25,605.66		44		992.00		442		118,572
Dibwe	DBC		89		5,547.45		12		260.00		84		40,221
	DBD		165		14,492.09		6		73.00		159		31,827
Sub-Total			254		20,039.54		18		343.00		243		72,048
TOTAL			726		45,645.20						685		190,610

* Composited 1m gamma records.

Table 17.4: Recent Sample Data Used in Resource Estimation

17.2.2 Topographic Data and Validation

Topographic data over the project area was available for use in resource estimation work. The deposit is located in an area of low to moderate relief, with an elevation differential of approximately 45m between highest and lowest drill hole collars. The land surface is near parallel to the south-south-easterly dip of the sediments (15^o to 20^o) south dip of the sediments. The northern side of the deposit is bounded by a north sloping escarpment, where elevation falls approximately 30m over a distance of 200m.

Updated digital topographic data for the project from Geoscientific Mineral Resources SA (Centre for Advanced Satellite & Mineral Exploration) and comprised orthorectified and re-projected IKONOS Satellite Image data as 20m, 10m and 5m contour data. The 5m contoured digital data was imported into Micromine and a new DTM topographic surface created (Figure 17.1) and compared to historic topographic data held by CSA. A review of this data highlighted several discrepancies between the positions of known holes in relation to prominent topographic highs at Mutanga (particularly the escarpment to the north) and Bungua (a prospect to the east of Dibwe).

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Further investigation found that the digital topographic data supplied was presented in WGS84 datum coordinates and not the more relevant Arc 1950 (Area 44) datum, which is used on site and covers the project area. Therefore, the conversion from WGS84 to Arc 1950 (44) was applied and the DTM surface recreated. The conversion applied to x and y values was +288m added to the y (northing) and 0.6m added to the x (easting). Once recreated, the DTM surface was reviewed and hole positions relative to surface features investigated once again.

Figure 17.1: Mutanga Topographic DTM (Oct 2008).

Although the updated topographic surface is an improvement over historical data held, the 5m contoured data does not include spot heights and as such, topographic highs are shown as flat contours resulting in potential elevation inaccuracies, especially at relatively high levels.

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After DGPS collar re-surveying of new holes at Mutanga and Dibwe, collar elevations were compared to the topographic DTM. The difference between each collar elevation and the elevation of the topographic surface at the same x and y coordinate was calculated. Figure 17.2 below shows the difference in elevation for each hole at Mutanga (top left) and Dibwe (bottom centre). Classical statistical analysis was undertaken on elevation data and the average differences generated. At Mutanga, an average difference of 10.5m is observed, whilst at Dibwe this value is 11.5m. On closer inspection, it is apparent that the greatest differences occur in areas with relatively high elevation (Figure 17.3), a function of topographic contour smoothing at the highest elevations.

To investigate ways in which collar elevations could be assigned more accurately, collar elevations were adjusted at Mutanga and Dibwe by 10.5m and 11.5m respectively (Table 17.5) and a revised topographic DTM created using the new collar points. This DTM was then compared to the satellite image derived DTM. The modified topography does not honour the contouring of the recent topographic surface and introduces a greater degree of variation in elevation than is observed on the ground. Therefore, it was decided that collar elevations written to the database would be derived by draping existing collars on to the recent topographic surface, with no elevation correction applied.

The satellite image derived DTM surface represents the most accurate topography and draped collar elevations are accurate to +/- 2.5m at lower levels and +/- 5.0m at higher elevations.

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Figure 17.2: Recent Drill Hole Collars, Coloured by RL difference.

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				All				Mutanga				Dibwe
Recent				outliers				outliers				outliers
Drilling		All		removed		Mutanga		removed		Dibwe		removed
Re-surveyed collars	MEAN		11.30		10.22		10.90		10.80		11.84		9.41
	MEDIAN		10.42		10.23		11.28		11.20		10.23		9.45
Non-resurveyed collars	MEAN		11.13		10.80		11.00		10.53		11.48		11.48
	MEDIAN		10.64		10.58		9.33		9.22		11.68		11.68
RL adjustment to be applied to original RL values									10.5				11.5

Table 17.5: Average Elevation Difference of New Holes at Mutanga and Dibwe.

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Figure 17.3: Mutanga Collars, Coloured by RL Difference.

17.3 Data Validation

17.3.1 Drill Hole Data Validations.

Collar, down-hole gamma data, chemical assay data and survey data for new drilling was converted from excel spreadsheets to .csv file format and imported into Micromine. A temporary database of new data was created and the following validations were preformed:

• Checking for duplicate collar, gamma, assay and survey data.

• Checking for overlapping intervals.

• Checking for missing data.

• Checking for incorrect survey dip and azimuth data.

• Validation of end of hole depths.

• Visual validation of hole positions with respect to local cross section nomenclature.

• Visual validation of collar x, y and z coordinates against updated topographic data.

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The validation phase highlighted a number of errors in the new data provided:

• A significant number of recent holes were found to plot incorrectly on the cross sections to which they were assigned. It was found that some holes had collar coordinates generated via hand-held GPS rather than via the more accurate DGPS. All GPS surveyed collar holes were re-surveyed on-site via DGPS and the database updated accordingly. Details of this work are contained in Table 17.6;

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			No of holes
			requiring		No of holes
Deposit	No of new holes		re-survey		re-surveyed
Mutanga		472		24		54	*
Dibwe		249		74		102	*
Mutanga & Dibwe		721		98		213	**

*	In addition to those holes requiring re-survey due to GPS inaccuracies, additional holes were selected by Denison validation purposes.
**	In addition to those holes from Mutanga and Dibwe that were re-surveyed, additional holes drilled outside of these resource areas were also the subject of re-surveying activities.

Table 17.6: GPS Surveyed Holes Re-surveyed by DGPS

• Several holes had conflicting end of holes depths when comparing gamma data and collar data. Where these issues could not be resolved, the holes in question were flagged in the database, used in the grade interpretation stage but removed from the final resource estimation dataset. A total of 3/472 holes were flagged in the database.

• Following re-surveying, all holes were checked in 3D and on cross section. Several holes were found to plot incorrectly. Where these discrepancies could not be resolved, these holes and all data pertaining to them were removed from the final resource estimation dataset. A total of 14/472 additional holes were removed from the final resource estimation dataset.

• Following re-surveying activities, collar elevation data was compared to the new topographic DTM and any discrepancies investigated. A number of issues came out of this work, which are discussed in Section 17.2.2.

17.3.2 Gamma Data Review

During the recent drilling campaigns at Mutanga and Dibwe, down-hole gamma logging was routinely undertaken at the completion of each hole, except in those holes which suffered wall cave-ins or where a high risk of tool loss was present.

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Historical resource estimates for both Mutanga and Dibwe have relied to a large extent on historic chemical assay data, some of which cannot be verified. With the recent infill drilling campaign the drill hole database has become significantly larger. Gamma probe derived e U₃O₈ is the dominant grade data medium. See Section 14.1.1 for further discussion on the application, test work and reliability of the gamma logging conducted for these deposits. No significant issues have arisen from this work and gamma probe data is considered valid for use in resource estimation work. Gamma probe calibration information (including an example of the WellCAD output for routine probe calibration QAQC using the MTD test hole on site, as well as tool calibrations undertaken in the US) is contained in Appendix 4.

Prior to the consideration to use gamma data from new holes in the resource estimations, a comparison was made between gamma data and corresponding QAQC chemical assay data. At Mutanga, a total of 486 drill holes were used in the grade interpretation, comprising 240 recent holes with gamma data and 246 holes (largely historic holes) with assay data. 339 recent chemical assays from 16 holes, along with 1,313 historical assays were available for comparison with gamma data.

At Dibwe, a total of 208 drill holes were used in the grade interpretation, comprising 149 recent holes with gamma data and 59 historical holes with assay data. 89 QAQC chemical assays from 7 holes, along with 193 historical assays were available for comparison with gamma data.

Given this small sample population relative to gamma data, direct comparison on an interval-by-interval basis was not considered, not least because available assay data is not representative of all mineralised grade ranges (especially grade ranges >200ppm) nor spatially representative of each deposit. A more valid approach is to use the comparison of overall population statistics from all assay data and all gamma data, to assess the validity of gamma data for use in resource estimation. It was this approach that was adopted.

17.3.2.1 Mutanga

Classical statistics and histogram/probability plot (Figure 17.4 and Figure 17.5) comparisons for Mutanga are contained in Table 17.7.

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Summary Statistics — All Mutanga Assay and Gamma Data

	U3O8 (ppm)		e U3O8 (ppm)
Number		1,652		3,505
Minimum		0		0
Maximum		8,400		12,906
Mean		317.24		374.95
Median		157.00		175.00
Std Dev		556.29		697.51
Variance		309,453.53		486,518.78
Std Error		0.34		0.20
Coeff Var		1.75		1.86
Log Num		1,612.00		3,504.00
Geom Mean		168.04		206.42
Log Min		0.00		2.71
Log Max		9.04		9.47
Log Mean		5.12		5.33
Log S Dev		1.16		0.96
Log Var		1.35		0.92
Sichel Stats
Mean		330.05		326.47
V		1.35		0.92
Gamma		1.96		1.58
Percentiles
10		45		71
20		73		101
30		100		120
40		124		143
50		157		175
60		199		220
70		258		289.5
80		383.6		428
90		680		731.5
95		1,107.2		1,309.75
97.5		1,888.3		2,080.125
99		2,888.32		3,698.8

Table 17.7: Comparative Sample Statistics — Mutanga

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Figure 17.4: Raw Data Histogram Trace of Mutanga Assay Data (orange) and Gamma Data
(blue) Populations.

Figure 17.5: Raw Data Probability Plot of Mutanga Assay Data (orange) and Gamma Data
(blue) Populations.

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A review of the population graphs above indicates that the gamma population exhibits higher grades overall, especially in grade ranges below 200ppm and this trend is not unexpected. The shape of the two distributions is broadly similar, being slightly positively skewed, with greater relative deviation at the extremes of the distribution.

Further analysis of a variety of grade ranges (<100ppm, 100ppm-500ppm and 500ppm+) showed that in the range 100-500ppm, which represents most of the potentially economic mineralisation over the project, absolute population average grade differs by only 5ppm and the statistical characteristics of the two populations (as as shown by the box and whisker plots in Figure 17.6 below) are very similar. A modification value of 5ppm was subtracted from all values within the gamma population and the population statistics revisited (Table 17.8).

Figure 17.6: Probability Plot of Mutanga Raw Assay and Gamma Data (>100ppm<500ppm)

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Summary Statistics — Mutanga Assay and Gamma Data

	U3O8 (ppm)		adj e U3O8 (ppm)		e U3O8 (ppm)
Number		1,652		3,505		3,505
Minimum		0		10		0
Maximum		8,400		12,901		12,906
Mean		317.24		370.055		374.95
Median		157.00		170		175.00
Std Dev		556.29		697.58		697.51
Variance		309,453.53		486,617.526		486,518.78
Std Error		0.34		0.199		0.20
Coeff Var		1.75		1.885		1.86
Log Num		1,612.00		3,504		3,504.00
Geom Mean		168.04		199.045		206.42
Log Min		0.00		2.303		2.71
Log Max		9.04		9.465		9.47
Log Mean		5.12		5.294		5.33
Log S Dev		1.16		0.985		0.96
Log Var		1.35		0.97		0.92
Sichel Stats
Mean		330.05		323.226		326.47
V		1.35		0.97		0.92
Gamma		1.96		1.624		1.58
Percentiles
10		45		66		71
20		73		96		101
30		100		115		120
40		124		138		143
50		157		170		175
60		199		215		220
70		258		284.8		289.5
80		383.6		423.2		428
90		680		726.6		731.5
95		1,107.2		1,304.8		1,309.75
97.5		1,888.3		2,075.4		2,080.125
99		2,888.32		3,694.24		3,698.8

Table 17.8: Mutanga Summary Statistics (Modified Data)

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Figure 17.7: Histogram Trace of Mutanga Raw Assay Data (orange) and Modified Gamma Data (blue)

Figure 17.8: Probability Plot of Mutanga Raw Assay Data (orange) and Modified Gamma Data (blue).

Although the population average of gamma data remains somewhat higher than that for assay data, Figure 17.8 above shows that a good correlation is evident between the two datasets in the grade range 100-500ppm. Although there is a marked difference between the assay and gamma populations in the lower grade range (<100ppm), the influence this data will have on the resource

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estimate, which is constrained to domains based on a 100ppm lower cut-off, is likely to be small. At the higher grade range (>500ppm), although gamma data has returned higher grades than chemical assays, this data represents less than 2% of the sample population and the influence of high grade outliers will be controlled, to some degree, by the balancing cut applied prior to modelling.

17.3.2.2 Dibwe

Classical statistics and histogram/probability plot comparisons for Dibwe are contained in the following tables (Table 17.9) and graphs (Figures 17.9 and 17.10).

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Summary Statistics — All Dibwe Gamma and Assay Data

	CHEMICAL ASSAY		e U3O8
	U3O8 (ppm)		(ppm)
Number		282		1498
Minimum		0.1		0
Maximum		1680		3102
Mean		244.11		242.40
Median		170.00		162.00
Std Dev		252.77		248.75
Variance		63,892.17		61,875.28
Std Error		0.90		0.17
Coeff Var		1.04		1.03
Log Num		282.00		1,471.00
Geom Mean		121.20		173.57
Log Min		-2.30		2.57
Log Max		7.43		8.04
Log Mean		4.80		5.16
Log S Dev		1.73		0.84
Log Var		2.99		0.71
Sichel Stats
Mean		665.91		246.85
V		2.98		0.70
Gamma		5.49		1.42
Percentiles
10		24		54
20		57		89
30		102		112
40		134		136
50		170		162
60		217		197
70		275		256
80		376		359
90		556		525
95		723		672
97.5		972		858
99		1,174		1,219

Table 17.9: Comparative Sample Statistics — Dibwe

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Figure 17.9: Histogram Trace of Dibwe Raw Assay Data (orange) and Modified Gamma Data (blue)

Figure 17.10: Probability Plot of Dibwe Raw Assay Data (orange) and Gamma Data (blue).

The assay and gamma populations at Dibwe show similar statistical characteristics (Figures 17.9 and 17.10), having similar mean and standard deviation values and both showing normal distributions with similar dispersion as shown by a low CV of close to 1. Above 100ppm the two distributions show close correlation and therefore the decision was made not to modify the gamma data.

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17.3.3 Gamma Data Review — Conclusions

The number of recent check assays with which to validate the large amount of gamma data generated during the recent infill drilling campaign is low. In order to increase the level of confidence that can be applied to the indirect method of uranium grade calculation via gamma probing, it is recommended that additional check assaying be undertaken, particularly at Dibwe, that ensures not only that returned assays are representative of all grade ranges estimated by gamma probing, but also spatially representative.

Nevertheless, combining recent assay data with validated historic data has allowed a larger sample population to be used to validate gamma data. Statistical analysis suggests the two data populations show similar characteristics and are statistically compatible. These two sample supports are considered reliable for the purposes of resource estimation.

17.4 Geological Modelling

Data available for the resource update included the historical data used in the December 2006 resource estimation plus all available recent 2007 and 2008 Denison drilling data.

Prior to updating the geology/grade models for each deposit, historic interpretations were reviewed in the light of significant new data which has provided valuable infill drilling data at both deposits. Infill drilling has allowed the cross sectional interpretation of mineralised zones at both deposits to be refined. The positions of major bounding fault and fracture zones at both deposits constructed using surface mapping data and developed for use in the December 2007 resource estimations remain valid and these bounding structures have influenced the subdivision of the mineralised zones at both deposits in to several domains.

Mineralisation outlines based on U₃O₈ (historical data) and eU₃O₈ (recent data) grade intercepts were interpreted using a 100ppm cut-off, honouring the local stratigraphy and bounding fault or fracture structures.

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17.4.1 Geological Interpretation — Mutanga Deposit

The four mineralised zones outlined during the previous resource estimate in 2006 remain valid and an additional zone has been delineated in the west of the deposit. Five sets of fault bounded zones were digitised and coded with a MIN code to differentiate the zones (Figure 17.11).

1.	MIN 1 — West boundary zone, bounded by fault or fracture zones trending NNE. Outcrops on western edge of the Mutanga escarpment.
2.	MIN 2 — Upper near surface zone of mineralisation. Outcrops along Mutanga escarpment. Gentle dip to SSE, bounded to the south by inferred NE trending fault or fracture zone.
3.	MIN 3 — Deepest zone. Down-thrown mineralisation, trending NE. Bounded by two NE trending steep fault or fracture zones.
4.	MIN 4 — Near surface mineralisation, trending NE. Bounded by two NE trending steep fault or fracture zones.
5.	MIN 5 — Sub-horizontal zone of mineralisation, below MIN4. Bounded by two NE trending steep fault zones.

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Figure 17.11: Mutanga Mineralised Domains and Drill Hole Coverage.

The revised mineralised envelopes at Mutanga were interpreted in 2d cross section using available hole intercepts. In some areas the envelopes were extrapolated through some “barren” holes to maintain geological continuity, however extensive zones of barren material were not included so that grade dilution was kept to a minimum. Generally only intercepts which were greater than 1m in thickness were considered in the interpretation. At the margins of the deposit, mineralised envelopes were extrapolated by a distance equal to half the drill hole spacing where drill coverage exists and by 50m at the edge of drill coverage.

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The mineralised outlines were linked to form 3-D solid wireframe shapes and validated to ensure no openings or crossing triangles. Representative cross section and a 3-D view are presented in Figure 17.12 and Figure 17.13. Note that a 3X vertical exaggeration has been applied to the cross section and 3-D view.

Figure 17.12: Representative Mutanga Cross Section (NW-SE)

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Figure 17.13: Representative Mutanga 3-D View

17.4.2 Geological Interpretation — Dibwe Deposit

A process similar to that described for Mutanga was used at Dibwe. Dominant fault and fracture positions were reviewed in the light of new data and mineralised zone interpretations refined. Outlines at a nominal U₃O₈ cut-off of 100ppm were interpreted to follow gross bedding horizons. The overall bedding dip at Dibwe appears steeper than at Mutanga. As part of the resource estimation undertaken in 2006, general uncertainty surrounding the exact position of some of the mineralised intercepts and relatively sparse data coverage resulted in a more generous mineralisation interpretation than that used for Mutanga. In the light of new infill drilling data, mineralised zone extents are better defined and therefore the constraint of half drill hole spacing or 50m extrapolation was applied at Dibwe.

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The mineralisation zones at Dibwe appears to be more closely related to stratigraphic control with minor faulting or fracture related features occurring in the central zone. The Dibwe mineralisation envelope is thinner than Mutanga with an average thickness of around 3-5 metres. As in December 2006, three sets of fault bounded zones were digitised and coded to differentiate the zones:

1.	NW — Small isolated north-west zone based on a two drill hole intercepts, bounded by fault or fracture zones trending NE.
2.	CENTRAL — Dominant central zone of mineralisation, bounded on both sides by inferred NE trending fault or fracture zones. Comprising 13 discrete and semi-continuous sub-zones.
3.	SE — Deepest zone. Down-thrown mineralisation, trending NE. Potentially open at depth to the SE and comprised of 9 discrete sub-zones.

Representative plan, cross section and 3-D views of the Dibwe mineralisation are presented in Figure 17.14, Figure 17.15 and Figure 17.16. Note 3X vertical exaggeration used in the section and 3D views.

Figure 17.14: Dibwe Mineralised Domains and Drill Hole Coverage.

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Figure 17.15: Representative Mutanga Cross Section (NW-SE)

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Figure 17.16: Dibwe 3D View of Mineralisation Surfaces.

17.5 Statistical Analysis

17.5.1 Historic Data Analysis

During 2007 a review was undertaken of the various methods of uranium determination undertaken at both deposits during historic drilling (pre-2005) campaigns. At that time the sample database was dominated by data derived via historical indirect uranium determination and calibrations: Fluorimetry, Spectrometry and Logging techniques as well as direct uranium determination via assaying of large diameter hole samples. Limited information was available at the time in which to validate this historical data and confirmatory drilling implemented by Omega and Denison between 2005 and 2007, which generated reliable chemical assay data derived from pressed pellet XRF assays using methods named X75 and X79 (X79 for samples exceeding 4000ppm U₃O₈) and implemented following appropriate drilling and sampling techniques and QAQC protocols was deemed the most reliable data for the project.

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Given the limited number of confirmatory holes, the previous resource estimate relied heavily upon the use of historical data in order to provide enough data necessary for estimating resources over both deposits. As such, a detailed statistical analysis of historical indirect uranium data was undertaken in order to assess the reliability and validity of this data for use in resource estimations and it’s compatibility with the more reliable Omega and Denison assay data. The various drilling campaigns and sampling methods represented different sample supports and it was critical that their compatibility was assessed prior to resource estimation. Results from regression statistics indicated that there was no statistical differences between data derived from Fluorimetry, Spectrometry and Logging techniques when a modification factor was applied directly from the regression statistics and as such, data derived via these mediums was used in the previous estimations, in the absence of large amounts more recent, reliable data. In addition and a critical issue at the time, an investigation was undertaken to assess the grade distribution in un-sampled parts of historical holes situated within the mineralised zones.

Sixty percent of the historically probed hole intervals had no data recorded and these were arbitrarily set to 0.1ppm in the sample database and were commonly thought to be in areas where grade <250ppm had been intersected. This was a significant portion of the total data set within the mineralised envelopes. Therefore a simulation exercise was undertaken in order to generate reasonable values for un-sampled intervals at grades less than about 250ppm U₃O₈. These simulated values were checked and found to honour both the range and variability evident in the low grade samples in the drilling at the time. The low grade simulated values were found to better reflect the low grade portion of the statistical populations and provided a reasonable data set for variography and grade estimation.

Whilst these investigations enabled a certain degree of confidence to be applied to historical input data such that Inferred Resources could be classified for those parts of each resource estimated using only historical data, in the light of a significant amount of new gamma probe data derived from the recent drilling campaigns (2007-08), which included valid QAQC protocols and monitoring and which may be considered to represent the grade distribution of domains at both deposits in a spatial sense. This recent data supersedes most of the old historical data, being more reliable for use in resource estimation and which may facilitate the classifying of higher confidence resource categories.

Therefore, following a review of all data held for the project, grade data used in these resource estimation updates comprises all valid data from the recent drilling campaigns as well as chemical assay data from historic drilling campaigns undertaken by Omega/GeoQuest, but omits historical data from previous campaigns undertaken by Agip, see Table 17.3, in favour of more reliable recent data. Exceptions to this general rule are in the case of MIN2 at Mutanga and domains at Dibwe, discussed in the following sections.

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17.5.2 Statistical Analysis — Mutanga

17.5.2.1 Statistical Analysis — Drill Type

Following a review of interpreted domains, updated domain wireframes were used to flag the sample database and assign each U₃O₈ value to the domain in which it occurs. Statistical analysis was then undertaken on U₃O₈ grade populations within each domain in order to investigate the typical grade characteristics, variability and data skewness. Before undertaking statistical analysis by domain, descriptive statistics and histograms were generated for grade data by drill type, so as to confirm these data types as compatible for use in resource estimation. Tabulated statistics by drill type are shown below.

Recent drilling data (2007-08), comprising gamma data from RC and Diamond holes accounts for 77% of valid total project data and is considered to representative of the deposit, both spatially and in terms of the grade distribution. The grade populations from MTC, MTD and MRC holes exhibit broadly similar characteristics and have similar mean values (Table 17.10).

MGSC and MGSD holes show much higher average grades than other datasets, a function of these holes being drilled as close spaced holes in a high grade area of the deposit, for use in geostatistical analysis, therefore the high grade nature of these populations is expected and data from these holes is still valid for use in resource estimation since these holes define a localised, small volume of the resource and the influence these clustered, high grade samples will have on the overall resource estimate is small since grade interpolation parameters and the application of search distances during grade interpolation will essentially control the influence of these samples.

MDH and MR grade populations are somewhat higher grade than other datasets, however MDH holes, which represent 6% of total project data and total 15 holes, 13 of which occur in the MIN2 domain, do not have an undue effect on overall domain statistics in MIN2 and their influence is restricted to the MIN2 domain. The high grades exhibited by the MR hole population are unlikely to have a significant effect on the overall resource estimate since this data accounts for 4% of project data and total 11 holes.

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	Drill Type
							M
Statistics	MDH			MR			RC			SWD			MTC			MTD			MGSC			MGSD
Data Type	ASSAY			ASSAY			ASSAY			ASSAY			GAMMA			GAMMA			GAMMA			GAMMA
% of all data		6	%		4	%		13	%		2	%		29	%		25	%		15	%		8	%
Number		311			149			598			131			1306			1068			691			382
Minimum		9			18			0			0			1			0			39			19
Maximum		8,400			2,425			3,456			1,945			7,082			6,296			8,511			12,901
Mean		382.07			391.06			264.30			480.76			263.79			292.42			580.71			571.80
Median		156.50			236.00			144.00			312.00			151.00			143.00			232.00			225.00
Std Dev		789.31			461.79			410.32			423.62			417.32			505.53			952.27			1,147.87
Variance		623,011.95			213,248.07			168,358.74			179,456.40			174,154.03			255,560.40			906,811.63			1,317,601.19
Std Error		2.54			3.10			0.69			3.23			0.32			0.47			1.38			3.01
Coeff Var		2.07			1.18			1.55			0.88			1.58			1.73			1.64			2.01
Log Num		311.00			149.00			597.00			128.00			1306.00			1067.00			691.00			382.00
Geom Mean		182.02			244.42			156.83			340.62			166.02			164.44			299.36			279.20
Log Min		2.20			2.89			0.69			2.08			0.00			2.40			3.66			2.94
Log Max		9.04			7.79			8.15			7.57			8.87			8.75			9.05			9.47
Log Mean		5.20			5.50			5.06			5.83			5.11			5.10			5.70			5.63
Log S Dev		1.08			0.94			0.94			0.92			0.90			0.98			1.04			1.04
Log Var		1.17			0.89			0.89			0.85			0.82			0.95			1.08			1.07
Sichel Stats
Mean		325.09			377.58			243.63			518.29			249.59			264.65			511.33			475.20
V		1.16			0.88			0.89			0.85			0.82			0.95			1.08			1.07
Gamma		1.79			1.55			1.55			1.52			1.50			1.61			1.71			1.70
Percentiles
10		53.20			81.00			57.80			114.10			63.00			54.00			99.00			97.00
20		81.00			108.00			79.00			146.00			86.00			75.00			123.20			119.00
30		100.00			137.00			102.40			193.50			105.00			100.40			151.60			152.00
40		119.20			179.00			117.20			251.00			123.00			120.00			186.00			177.80
50		156.50			236.00			144.00			312.00			151.00			143.00			232.00			225.00
60		202.20			282.60			173.80			446.00			186.00			182.00			321.00			286.00
70		249.70			365.80			217.80			567.00			233.20			240.00			467.00			409.00
80		436.80			504.40			287.00			807.60			333.80			353.40			686.00			573.80
90		857.00			910.20			516.40			1,013.00			515.40			607.60			1,413.80			1,269.20
95		1,209.90			1,510.30			864.80			1,207.20			791.10			945.20			2,268.20			2,201.00
97.5		2,043.58			1,938.38			1,481.40			1,775.00			1,186.50			1,647.90			3,479.40			3,746.65
99		3,786.03			2,232.69			2,439.78			1,775.00			1,773.78			2,535.72			5,092.36			5,421.54

Table 17.10: Summary Statistics of Each Drill Type.

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17.5.2.2 Mutanga Domain Statistics

Descriptive statistics, histograms and probability plots were generated for all domains. A summary of raw data contained within each domain is contained in Table 17.11.

		Hole	No of		Data	No of
Domain	Drill Coverage	Type	Holes		Type	assays*
MIN1	50m × 50m, limited 5m × 50m coverage to N	SWD		12	ASSAY		16
		MRC		10	ASSAY		51
		MTC		3	GAMMA		18
		MTD		9	GAMMA		53
MIN2	50m × 50m plus two 10m spaced fence lines	SWD		51	ASSAY		65
		MRC		41	ASSAY		389
		MR		1	ASSAY		18
		MGSC		17	GAMMA		405
		MGSD		11	GAMMA		255
		MTC		26	GAMMA		257
		MTD		68	GAMMA		331
MIN3	50m × 50m plus two 10m spaced fence lines	MDH		12	ASSAY		229
		MR		8	ASSAY		124
		MRC		14	ASSAY		161
		MGSC		12	GAMMA		287
		MGSD		5	GAMMA		127
		MTC		24	GAMMA		352
		MTD		37	GAMMA		431
MIN4	50m × 50m	MDH		2	ASSAY		26
		MR		1	ASSAY		23
		MTC		45	GAMMA		545
		MTD		28	GAMMA		194
MIN5	50m × 50m, 100m × 50m at edge areas	MDH		1	ASSAY		3
		MTC		31	GAMMA		167
		MTD		19	GAMMA		136

* “assay” refers to gamma derived U₃O₈ data and actual chemical assay U₃O₈ data where appropriate.

Table 17.11: Summary of Raw Data Contained Within Each Domain

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Descriptive statistics for raw data contained within each domain is contained in Table 17.12.

	DOMAIN
Statistics	MIN1		MIN2		MIN3		MIN4		MIN5
Number		137		1681		1787		774		303
Minimum		0		0		0		0		21
Maximum		2,191		12,901		8,400		2,361		4,245
Mean		185.44		490.26		347.54		197.79		220.71
Median		121.00		203.00		175.00		132.00		115.00
Std Dev		258.10		923.70		549.72		216.24		358.99
Variance		66,613.92		853,215.04		302,186.13		46,760.06		128,871.82
Std Error		1.88		0.55		0.31		0.28		1.19
Coeff Var		1.39		1.88		1.58		1.09		1.63
Log Num		135.00		1,674.00		1,785.00		773.00		303.00
Geom Mean		121.98		241.84		194.63		147.41		131.08
Log Min		0.00		0.00		0.69		3.18		3.05
Log Max		7.69		9.47		9.04		7.77		8.35
Log Mean		4.80		5.49		5.27		4.99		4.88
Log S Dev		0.97		1.09		1.01		0.71		0.92
Log Var		0.94		1.18		1.02		0.50		0.85
Sichel Stats
Mean		193.27		435.48		324.73		188.36		199.67
V		0.93		1.18		1.02		0.50		0.85
Gamma		1.58		1.80		1.67		1.28		1.52
Percentiles
10		50.40		74.00		61.00		62.00		44.00
20		64.80		105.20		89.00		84.80		59.60
30		82.50		130.00		112.00		102.00		74.00
40		103.00		160.00		142.00		116.00		99.00
50		121.00		203.00		175.00		132.00		115.00
60		136.20		257.60		225.00		164.00		143.00
70		168.50		369.70		295.90		192.00		181.10
80		203.80		557.00		417.60		245.20		254.00
90		349.10		1,046.20		736.30		373.00		467.90
95		512.30		1,962.70		1,197.30		517.20		694.05
97.5		710.80		3,213.35		2,022.53		747.80		1,169.20
99		1,349.39		5,102.76		2,819.11		1,142.58		1,699.94

Table 17.12: Descriptive Statistics by Drill Type — Mutanga

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17.5.2.3 Compositing

In order to ensure that all data values have a comparable influence on the data statistics, data compositing was undertaken by considering the histogram of sample intervals. Figure 17.17 below clearly shows the dominant sample interval for Mutanga data is 1m. Therefore domained data was composited to 1m down-hole intervals prior to further statistical analysis and top-cutting.

Since gamma data (which makes up the majority of grade data within each of the domains) was already composited to 1m intervals from the original data source, only chemical assay data was required to be composited.

Figure 17.17: Mutanga Sample Interval Histogram

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17.5.2.4 Top-Cuts

The grade distributions within each domain are positively skewed, exhibiting “tails” of high-grade data and commonly domains exhibit high grade outliers that influence the overall domains statistics. The degree of grade dispersion, or skewness is understood by considering the domain COV (coefficient of variation), which ranges from 1.09 to 1.88. A value of 1.0 would suggest a perfectly normal, unskewed distribution. It is important that a top-cut value is applied to extreme grade outliers so that these grades do not overly influence the statistics or result in undue bias towards high grades during grade interpolation. Several criteria are used to determine appropriate top-cuts, including domain COV, visual analysis of the histogram tail and consideration of the percentage of cut data for any given top-cut. At this stage, the MIN2 domain was sub-set in to two sub-domains (MIN2 and MIN2HG) so that the high grade portion of the deposit, defined exclusively by SWD drilling on the escarpment in the NW of the deposit could be domained out and estimated separately from the rest of the MIN2 domain.

Top-cut analysis was performed for each domain and is summarised in Table 17.13 below.

	Top									%			%
Top	Cut		Raw		%		Raw			data			U3O8
Cut	mean		mean		diff		COV		Considerations	cut			cut		Domain
									COV trigger,
800		170		185		-9		1.4	inflection/loss of metal-data balance		6			2	MIN1
									COV trigger,
									inflection/loss of
2,000		250		267		-6		1.9	metal-data balance		6			2	MIN2
									inflection/loss of
2,000		520		580		-10		1.4	metal-data balance		<1	%		8	MIN2_HG
									COV trigger,
									inflection/loss of
3,000		335		348		-2		1.6	metal-data balance		2			1	MIN3
									inflection/loss of
900		189		198		-4		1.1	metal-data balance		2			4	MIN4
									COV trigger,
									inflection/loss of
900		192		221		-13		1.6	metal-data balance		4			13	MIN5

Table 17.13: Top-cut Analysis Performed for Each Domain

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17.5.2.5 Mutanga Top-cut Domain Statistics

Following the application of top-cuts to data within each domain and after compositing the data to standard intervals, descriptive statistics and histograms were generated for each domain,

Descriptive statistics (Table 17.14) and histograms (Figures 17.18 to 17.23) for top-cut composite data are shown below.

	DOMAIN
Statistics	MIN1		MIN2		MIN2HG		MIN3		MIN4		MIN5
Number		136		1189		173		1711		764		300
Minimum		1		0		30		0		24		21
Maximum		800		2,000		2,000		3,000		900		900
Mean		170.64		249.68		520.57		334.78		189.02		191.76
Median		121.00		152.00		336.00		177.00		133.00		115.00
Std Dev		161.40		324.27		486.12		466.45		163.90		203.36
Variance		26,049.27		105,147.78		236,309.90		217,574.22		26,863.07		41,355.80
Std Error		1.19		0.27		2.81		0.27		0.22		0.68
Coeff Var		0.95		1.30		0.93		1.39		0.87		1.06
Log Num		136.00		1,186.00		173.00		1,709.00		764.00		300
Geom Mean		120.47		164.44		354.86		196.06		146.19		127.64
Log Min		0.00		0.00		3.40		0.69		3.18		3.05
Log Max		6.69		7.60		7.60		8.01		6.80		6.80
Log Mean		4.79		5.10		5.87		5.28		4.99		4.85
Log S Dev		0.93		0.86		0.89		0.99		0.68		0.87
Log Var		0.87		0.74		0.79		0.97		0.47		0.76
Sichel Stats
Mean		184.29		237.82		524.34		318.8		183.64		186.17
V		0.86		0.74		0.78		0.97		0.47		0.76
Gamma		1.53		1.45		1.48		1.63		1.26		1.46
Percentiles
10		52.20		66.00		130.00		63.00		62.40		44.00
20		69.20		92.80		149.60		92.00		84.80		59.00
30		88.60		110.00		209.80		113.00		102.00		74.00
40		104.40		128.00		251.00		142.00		115.00		98.00
50		121.00		152.00		336.00		177.00		133.00		115.00
60		136.60		181.00		446.00		226.00		16.00		142.00
70		165.00		222.00		567.90		296.00		192.00		181.00
80		210.60		276.00		811.00		420.80		246.00		251.00
90		372.20		491.10		119.00		732.70		370.60		470.00
95		515.40		825.40		1,775.00		1,174.35		518.40		683.00
97.5		711.40		1,345.28		1,953.10		1,933.05		750.80		900.00
99		800.00		2,000.00		2,000.00		2,720.59		99.00		99.00

Table 17.14: Mutanga Domain Statistics (Composite Data)

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Figure 17.18: Mutanga MIN1 Domain Histogram (Composite Data)

Figure 17.19: Mutanga MIN2 Domain Histogram (Composite Data)

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Figure 17.20: Mutanga MIN2HG Domain Histogram (Composite Data)

Figure 17.21: Mutanga MIN3 Domain Histogram (Composite Data)

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Figure 17.22: Mutanga MIN4 Domain Histogram (Composite Data)

Figure 17.23: Mutanga MIN5 Domain Histogram (Composite Data)

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17.5.3 Statistical Analysis — Dibwe

17.5.3.1 Statistical Analysis — Drill Type

Following a similar methodology to that discussed above for Mutanga, descriptive statistics and histograms were generated for Dibwe grade data by drill type. Significant new data for the deposit has provided more reliable and representative sample data than that used in historic resource estimates. This resource study has utilised data from the drilling campaign of 2007 (DRC holes) and all recent drilling data (DBC and DBD holes) over the deposit. Historical drilling data from DDH and DWD, which was used in the resource estimate of 2007, has not been used in this study.

Recent drilling data (2007-08), comprising gamma data from RC and Diamond holes accounts for 90% of valid total project data and is considered to representative of the deposit, both spatially and in terms of the grade distribution. The grade populations from DBC, DBD and DRC holes exhibit broadly similar statistical characteristics and have similar mean values and COV’s, therefore these three datasets are considered compatible for use in resource estimation work (Table 17.15).

		Drill	Hole	No of			No of
Domain	Sub-Domain	Coverage	Type	Holes		Data Type	assays*
SE	5,6,7,8,10,11,12,18,19 and 22	50m × 100m	DRC		4	ASSAY		38
			DBC		5	GAMMA		29
			DBD		63	GAMMA		537
Central	2,3,4,9,13,14,15,16,17,20,21 and 24	50m × 100m	DRC		16	ASSAY		136
			DBC		45	GAMMA		405
			DBD		47	GAMMA		553
NW	10	50m × 100m	DRC		2	ASSAY		4

* “assay” refers to gamma derived U₃O₈ data and actual chemical assay U₃O₈ data where appropriate.

Table 17.15: Dibwe Raw Data by Domain and Drill Type

During resource estimation work carried out in December 2006, the Dibwe deposit was divided in to three fault bounded domains for resource estimation (Table 17.16). In the light of new data, the mineralised zone interpretation has been refined and mineralised zones are not as continuous throughout the deposit as was inferred from previous interpretation based on limited data. As such, a total of 23 individual mineralised zones have been interpreted with are semi-continuous along strike and reflect the fragmented and fractured nature of the mineralisation at Dibwe.

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During the grade interpolation, these sub-domains were reviewed and those exhibiting similar grade and geometry characteristics and that are adjacent to each other across fault boundaries, were combined for the purposes of grade estimation.

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	Drill Type
Statistics	DBC			DRC			DBD
Data Type	GAMMA			ASSAY			GAMMA
% of all data		26	%		10	%		64	%
Number		445			178			1,088
Minimum		12			0			0
Maximum		2,048			1,318			3,102
Mean		241.35			238.26			244.09
Median		154.50			157.00			166.00
Std Dev		257.22			242.45			248.56
Variance		66,161.21			58,779.55			61,784.24
Std Error		0.58			1.36			0.23
Coeff Var		1.07			1.02			1.02
Log Num		445.00			177.00			1,061.00
Geom Mean		168.97			146.05			175.12
Log Min		2.49			0.69			2.57
Log Max		7.63			7.18			8.04
Log Mean		5.13			4.98			5.17
Log S Dev		0.82			1.10			0.86
Log Var		0.68			1.21			0.74
Sichel Stats
Mean		237.37			266.16			253.25
V		0.68			1.20			0.74
Gamma		1.41			1.82			1.45
Percentiles
10		67.00			34.20			49.00
20		96.00			65.00			86.00
30		113.00			95.20			112.40
40		133.00			124.20			137.00
50		154.50			157.00			166.00
60		192.00			188.40			203.80
70		246.50			263.00			262.00
80		337.00			377.40			367.40
90		477.00			548.00			549.20
95		708.50			735.30			661.00
97.5		933.50			973.40			824.80
99		1,431.55			1,094.42			1,183.20

Table 17.16: Descriptive Statistics by Drill Type (Raw Data) — Dibwe

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17.5.3.2 Compositing

The sample database used for resource estimation at Dibwe contained assay and gamma data over 1m intervals. Therefore, no compositing was needed and the raw intervals of 1m are effectively the composite intervals.

17.5.3.3 Top-Cuts

Similar methodology as that described for Mutanga was applied to Dibwe data. Given the low number of samples that occur within each of the sub-domains 2-24 these did not prove useful for top-cut analysis and attempting to define an appropriate top-cut on such small datasets was not attempted, except for sub-domains 17+19 and 8 (which straddle a fault boundary) which required a top-cut and which contained a reasonable amount of sample data (59 and 147 respectively). Therefore, top-cut analysis was run on these two sub-domains, then on the remaining data in the SE and Central domain. The NW domain, comprising a single sub-domain (10) did not require a top-cut.

Top-cut analysis is summarised in the table below (Table 17.17). Although there are high grade outliers in the central and SE domains and it was felt these should be cut, the application of an appropriate top-cut for these domains has not changed the domain statistics significantly and this will therefore have little effect in the resource estimate.

	Top												%			Domain
Top	Cut		Raw		%		Raw			% data			U3O8			/Sub-
Cut	mean		mean		diff		COV		Considerations	cut			cut			domain
									COV trigger,
									inflection/loss of
750		249		312		-20		1.5	metal-data balance		5			20		17+19
									inflection/loss of
1200		301		315		-4		1.1	metal-data balance		1			4		8
									inflection/loss of
1660		239		240		-1		1.0	metal-data balance		<1	%		<1	%	central
									inflection/loss of
1350		235		236		-1		0.9	metal-data balance		<1	%		<1	%	SE

Table 17.17: Top-Cut Analysis

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17.5.3.4 Dibwe Top-cut Domain Statistics

Following the application of top-cuts to data within each domain, descriptive statistics and histograms were generated for each domain. Descriptive statistics (Table 17.18) and histograms (Figures 17.24 to 17.26) for top-cut composite data are presented below.

	Domain
Statistics	SE		CENT		NW
Number		601		1088		4
Minimum		13		0		37
Maximum		1,350		1,660		184
Mean		251.00		233.89		116.25
Median		166.00		162.00		104.00
Std Dev		229.30		226.41		62.14
Variance		52,577.29		51,262.14		3,861.58
Std Error		0.38		0.21		15.54
Coeff Var		0.91		0.97		0.54

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	Domain
Statistics	SE		CENT		NW
Log Num		601.00		1058.00		4.00
Geom		173.78		170.33		99.78
Log Min		2.57		1.79		3.61
Log Max		7.21		7.42		5.22
Log Mean		5.16		5.14		4.60
Log S Dev		0.88		0.85		0.00
Log Var		0.77		0.73		0.00
Sichel Stats
Mean		255.25		245.17		120.73
V		0.77		0.73		0.37
Gamma		1.47		1.44		1.21
Percentiles
10		58.00		49.00		37.00
20		89.00		86.00		37.00
30		112.30		112.00		50.40
40		135.00		137.00		77.20
50		166.00		162.00		104.00
60		205.00		196.80		118.40
70		269.40		255.00		132.80
80		392.80		348.40		148.80
90		585.50		501.00		166.40
95		725.25		656.80		175.20
97.5		859.95		839.80		179.60
99		1,079.95		1,220.80		182.24

Table 17.18: Dibwe Domain Statistics (Composite Data)

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Figure 17.24: Dibwe SE Domain Histogram (Composite Data)

Figure 17.25: Dibwe Central Domain Histogram (Composite Data)

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Figure 17.26: Dibwe NW Domain Histogram (Composite Data)

17.6 In Situ Dry Bulk Density Statistics

During the recent drilling campaign no new sample data was collected for further bulk density analysis, therefore the information collated in December 2006 remains current and is described here.

A program of density determination was completed from the PQ core available from the Mutanga metallurgical drill hole program during. A total of 97 core samples from 12 holes were selected as being geologically representative of the material drilled. The core was dried and density determined by calculating the core volume which was then divided into the weighed dry mass to calculate the in situ dry bulk density. The mean and median density values are 2.1 tonnes per cubic metre. The distribution has a low variance (tight distribution, Figure 17.27). CSA recommend a global density of 2.1 be applied to for estimation of the Mutanga and Dibwe Mineral Resources (Table 17.19).

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Summary Stats — Bulk Density Data
Details	From		To		Dia		Length		Volume(l)		Mass(gm)		Density
Number		97		97		97		97		97		97		97
Minimum		1.1		1.3		81.9		96.0		0.53		1,010.00		1.82
Maximum		53.8		54.0		85.2		208.0		1.16		2,536.00		2.30
Mean		22.6		22.8		83.8		188.7		1.04		2,188.21		2.10
Median		20.9		20.9		84.0		197.6		1.09		2,277.00		2.10
Std Dev		13.5		13.5		0.7		24.0		0.13		305.11		0.09
Variance		182.0		182.2		0.5		574.2		0.02		93,089.79		0.01
Std Error		0.1		0.1		0.0		0.2		0.00		3.15		0.00
Coeff Var		0.6		0.6		0.0		0.1		0.13		0.14		0.04
Percentiles
10		5.9		6.1		82.8		153.0		0.85		1,603.80		2.00
20		10.0		10.1		82.9		188.8		1.01		2,120.40		2.04
30		13.2		13.4		83.6		193.8		1.06		2,220.00		2.06
40		16.7		16.9		83.9		196.2		1.07		2,237.60		2.08
50		20.9		20.9		84.0		197.6		1.09		2,277.00		2.10
60		24.8		25.0		84.1		198.5		1.10		2,298.80		2.12
70		29.7		29.9		84.3		199.2		1.11		2,319.80		2.13
80		34.6		34.8		84.5		200.6		1.11		2,343.60		2.16
90		42.5		42.7		84.7		202.7		1.12		2,409.20		2.21
95		46.7		46.9		84.7		204.4		1.13		2,480.00		2.25
97.5		50.1		50.3		84.8		205.1		1.14		2,512.35		2.27
99		50.8		51.0		85.1		207.0		1.15		2,536.00		2.30

Table 17.19: Bulk Density Data

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Figure 17.27: Bulk Density Data Distribution

17.7 Variography

A variography study was completed using the current composite datasets to determine the spatial correlation between samples at both deposits, to be used for grade estimation using ordinary kriging equations.

17.7.1 Mutanga — Variography

Variography was attempted for all domains using current composite grade data. Domains MIN1, MIN2HG and MIN5 contain insufficient data for meaningful variograms to be modelled and reliable directions of grade continuity could not be established. Variography performed on domains MIN2 and MIN3 produced more reliable variograms for the first two continuity directions, although poor in the third direction. Details of variography from the MIN2 and MIN3 domains are tabulated below, (Table 17.20).

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	Nugget		Continuity
Domain	(%)		Direction	Dip (O)		Azi(O)		Range (m)
MIN2		25	DIR1		12		126		50
			DIR2		0		216		20
			DIR3		78		306		15
MIN3		28	DIR1		0		036		50
			DIR2		0		126		25
			DIR3		90		306		15

Table 17.20: Variography from the MIN2 and MIN3 Domains

The close spaced drilling (CSD) undertaken during the recent drilling campaign over a 200m × 200m portion of the deposit straddling domains MIN2 and MIN3 (see Figure 17.11 and Figure 17.28 below) provides useful data with which to model variography using a close spaced dataset, that may be more representative of grade continuity over both domains. Accordingly, variograms were modelled using this data, which resulted in well behaved variograms that described the grade continuity directions and ranges reliably and which honour the general strike and dip of the mineralised zones in these domains.

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Figure 17.28: Close Spaced Drilling used for Geostatistical Analysis

The modelled nugget effect is low to moderate at about 20% of the total variability. Ranges extend further along the dip direction than the strike direction and the models honour the shallow dip of mineralisation to the SW (6^o) and shallow dip to the SE (6^o).

Details of variography from close spaced drilling is tabulated below (Table 17.21). Variogram plots for the down-hole variogram and continuity directions are shown in Figures 17.29 to17.32. Variability is scaled on the y axis, against the range in metres on the x axis.

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			Continuity
Domain	Nugget (%)		Direction	Dip (O)		Azi(O)		Range (m)
Close Spaced Drilling		21	DIR1		6		132		75
			DIR2		6		223		40
			DIR3		81		357		10

Table 17.21: Details of Variography from Close Spaced Drilling

Figure 17.29: Close Spaced Drilling, Down Hole Variogram

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Figure 17.30: Close Spaced Drilling, Direction 1 Variogram

Figure 17.31: Close Spaced Drilling, Direction 2 Variogram

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Figure 17.32: Close Spaced Drilling, Direction 3 Variogram

In order to test the robustness of these variogram models for use in the Kriging equations, a cross validation exercise was performed using the three variogram models, applied to domains MIN2 and MIN3 in order to see whether one model is more reliable at describing the grade continuity parameters than the others. The cross validation exercise methodology was to remove a composite data value from the population and use the surrounding values to estimate the removed grade. The resulting value is then compared to the estimate. The total average estimates are then compared to the actual estimates and if the variogram model is robust, the figures should be very close. The average error statistic should be close to zero and the standard deviation of the error statistic should be close to one. The table below summarises the results of the cross validation exercise (Table 17.22).

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	Variogram
Domain	Model	Error Statistic		SD
MIN2	MIN2		0.00127		0.433
	CSD		0.00199		0.420
MIN3	MIN3		0.00246		0.710
	CSD		0.00204		0.700
MIN1	CSD		0.000555		0.140
MIN2HG	CSD		-0.0364		0.57
MIN4	CSD		-0.000074		0.210
MIN5	CSD		0.00103		0.330

Table 17.22: The Results of the Cross Validation Exercise

Results from this work show there is little difference between the domain variography and CS variography for domains MIN2 and MIN3 and although the SD’s appear relatively low, the very small error statistics are a good result. The ranges determined through the CSD variography are longer than those defined by the MIN2 and MIN3 variography and these variogram parameters are considered more robust for use in the kriging equations.

Therefore, the CSD variogram model was applied not only to the MIN2 and MIN3 domains, but to other domains for which variogram parameters could not be modelled, i.e. all domains.

During the grade interpolation stage, Kriging was initially undertaken into blocks of the MIN2 and MIN3 domains using the MIN2 and MIN3 variogram model. The Kriging process was then re-run using the CSD variogram model. The overall block Kriging variance using the CSD variogram model was lower than the variance using the domain variogram models. This outcome goes some way to validating the choice of variogram model.

17.7.2 Dibwe Mineralisation U₃O₈ Variography

Although the dataset for the Dibwe deposit is significantly larger than in December 2007, the current drill hole spacing of 100m × 50m is still not sufficient to describe the grade continuity throughout the deposit and the narrow and highly fragmented and fractured nature of the mineralised zones within the deposits coupled with thee observed high variability in U₃O₈ throughout

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the deposit make modelling grade continuity difficult. Therefore, the CSD variogram model was tested on Dibwe domain data (resulting in an error statistic of 0.000594 and SD of 0.30 when applied to the Dibwe Centre domain and -0.00179 and 0.30 for the Dibwe SE domain. The CSD model parameters were applied to Dibwe for the purposes of grade estimation.

17.8 Grade Estimation

U₃O₈ grades were estimated into a block model for each deposit, constructed to honour the interpreted mineralised zones and the surface topography. Blocks within each model were coded by the relevant domains using the domain wireframes and then constrained to the surface topography. Blocks situated above the topographic surface were deleted. Adequate waste was built into the block models to ensure that they were suitable for open pit optimisation and mine planning. To speed up processing time, waste blocks were filtered out of each block model prior to grade interpolation and then re-merged into the block file after grades were assigned to each model.

Ordinary Kriging was used to estimate U₃O₈ based on the modelled variogram parameters. Inverse Distance squared estimation was completed as a comparison with the Kriged estimate.

The grade interpolation strategy for both deposits involved setting up search parameters in a search ellipse for each domain, which was then aligned to the geometry of each domain. A series of grade interpolation “runs” were then completed, at progressively larger search distances until all blocks received an interpolated grade. Constraints were applied to the number of grade values and holes used in the interpolations in order to improve the reliability of the estimates.

Upon completion of grade estimation for both deposits, a series of block model validations were completed to test the robustness of each estimate.

17.8.1 Mutanga Grade Estimation

17.8.1.1 Mutanga Block Model Construction

A sub celled block model was constructed from the wireframes defining the mineralised envelope and topographic surface. The model dimensions are presented in Table 17.23.

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Parameter	Minimum		Maximum
Easting Range		658,400m		660,000m
Northing Range		193,800m		195,200m
Elevation		500m		620m
Easting Block Size		20m		2m
Northing Block Size		20m		2m
Elevation Block Size		5m		0.5m

Table 17.23: Mutanga Block Construction Parameters

17.8.1.2 Mutanga Grade Estimation Parameters

Sample search parameters for Mutanga are tabulated in Table 17.24. The search ellipse was aligned with the dominant variogram directions and domain geometries.

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SEARCH ELLIPSE PARAMETERS MIN1

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		205/3		205/3		205/3		205/3
DIP		5		5		5		5
RADII 1 RANGE		35		50		100		200
RADII 2 RANGE		50		75		150		300
RADII 3 RANGE		3		10		20		40
Min samples per estimate		5		3		1		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

SEARCH ELLIPSE PARAMETERS MIN2

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		216/0		216/0		216/0		216/0
DIP		6		6		6		6
RADII 1 RANGE		35		50		100		200
RADII 2 RANGE		50		75		150		300
RADII 3 RANGE		3		10		20		40
Min samples per estimate		5		3		1		1
max samples per estimate		25		25		25		25
min hole per estimate		3		3		1		1

SEARCH ELLIPSE PARAMETERS MIN2HG

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		230/0		230/0		230/0		230/0
DIP		10		10		10		10
RADII 1 RANGE		35		50		100		200
RADII 2 RANGE		50		75		150		300
RADII 3 RANGE		3		10		20		40
Min samples per estimate		5		3		1		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

SEARCH ELLIPSE PARAMETERS MIN3

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		240/0		240/0		240/0		240/0
DIP		5		5		5		5
RADII 1 RANGE		35		50		100		200
RADII 2 RANGE		50		75		150		300
RADII 3 RANGE		3		10		20		40
Min samples per estimate		5		3		1		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

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SEARCH ELLIPSE PARAMETERS MIN4

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		240/0		240/0		240/0		240/0
DIP		5		5		5		5
RADII 1 RANGE		35		50		100		200
RADII 2 RANGE		50		75		150		300
RADII 3 RANGE		3		10		20		40
Min samples per estimate		5		3		1		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

SEARCH ELLIPSE PARAMETERS MIN5

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		240/0		240/0		240/0		240/0
DIP		5		5		5		5
RADII 1 RANGE		35		50		100		200
RADII 2 RANGE		50		75		150		300
RADII 3 RANGE		3		10		20		40
Min samples per estimate		5		3		1		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

Table 17.24: Grade Estimation Search Ellipse and Sample Parameters

Octant searching was not used. Grades were interpolated into parent cells so that sub-cells were assigned the value of their parent cell, to reduce adverse volume variance issues. Grades were interpolated into the model using the first run. Blocks which did not receive an interpolated grade were then used in successive runs until all blocks were populated.

17.8.1.3 Mutanga Model Validation

Once the grade estimates were completed, a series of model validations were completed to test the robustness of the estimate. These included:

• Comparison of average composite grade with average block grade for each domain.

• Swath plots of grade trends in depth, northing and easting.

• Visual validation of composite grades with block grades, throughout the deposit.

• Comparison of domain wireframe volumes with block volumes.

• Comparison of IDW estimate with the OK estimate.

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The comparison of average composite grades with block model grades is contained in Table 17.25.

	Block U3O8		De-clustered		Difference
Domain	(ppm)		composite U3O8 (ppm)		(%)
MIN1		136		146		-7.0
MIN2		344		321		5.7
MIN2HG		522		521		0.3
MIN3		332		335		-2.1
MIN4		189		182		-0.7
MIN5		196		192		-1.5
ALL		279		271		2.9

Table 17.25: Comparison of Average Composite Grades with Block Model Grades

The comparison of de-clustered composite grades and block model grades shows that the input and output data compare well. The exception is in domain MIN1 which contains relatively few data points and grades within this domain appear more smoothed than the rest of the model.

Swath plots showing grade trends in depth, northing and easting in each domain, are contained in Figures 17.33 to 17.38.

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Figure 17.33: Swath Plots MIN1

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Figure 17.34: Swath Plots MIN2

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Figure 17.35: Swath Plots MIN2HG

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Figure 17.36: Swath Plots MIN3

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Figure 17.37: Swath Plots MIN4

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Figure 17.38: Swath Plots MIN5

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The swath plots clearly show that the trends observed in the composite data sets for each domain are honoured by the block grade data, but with a degree of smoothing, which is to be expected with any grade estimation. In domains with relatively few data points (e.g. MIN1), the trends are less evident and the degree of smoothing greater. Local estimates of block grade within the MIN1 domain are likely to be less reliable than for other domains and as such, block grades above a cut-off are likely to be highly variable.

Visual validations were undertaken by reviewing slices through the block model and comparing composite grades to block grades by domain. Screenshots of domain slices are contained in Figures 17.39 to 17.43.

Figure 17.39: NW-SE Cross Section Through MIN1

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Figure 17.40: NW-SE Cross Section Through MIN2

Figure 17.41: NW-SE Cross Section Through MIN2HG,

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Figure 17.42: NW-SE Cross Section Through MIN3

Figure 17.43: NW-SE Cross Section Through MIN4 (top) and MIN5 (bottom)

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The cross sections through each domain indicate that block grades honour the general sense of the composite grades.

Wireframe volumes were compared to domain block volumes to ensure these are honoured and that the tonnage estimate is reliable. This Comparison is summarised in Table 17.26. Results from this comparison show that the difference between the wireframe volume and block model volume is negligible.

	Wireframe		Block Model		Difference
Domain	Volume (m3)		Volume (m3)		(%)
MIN1		223,761		222,968		-0.354
MIN2		2,104,117		2,104,394		0.013
MIN2HG		89,658		89,194		-0.517
MIN3		3,374,440		3,370,704		-0.111
MIN4		2,086,381		2,086,344		-0.002
MIN5		830,386		830,628		0.029

Table 17.26: Wireframe Volumes Compared to Domain Block Volumes

At the completion of the kriged estimate, the estimate was run again using the Inverse Distance Weighting (IDW) interpolation method, raised to the second power. The input data, search parameters and interpolation strategy were identical to the kriged model except that variography was not used. IDW estimates differ from kriged estimates in that they assume a zero nugget; nevertheless they are useful comparative estimates. These two estimation methods are compared in the following table (Table 17.27).

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	OK		IDW2
Material	U3O8 ppm		U3O8 ppm		diff %
ALL		279		281		-0.6
ALL>100ppm		287		290		-0.7
MIN1		136		127		-3.4
MIN2		344		336		1.0
MIN2HG		522		519		0.6
MIN3		332		331		-0.8
MIN4		189		187		-3.2
MIN5		196		189		-0.1

Table 17.27: Comparison of Mutanga OK Model and IDW2 Model

It is concluded from the validations performed on the Mutanga resource model, that the estimate of tonnage and grade can be considered reliable, robust and honours the input data used in its creation.

17.8.2 Dibwe Grade Estimation

17.8.2.1 Dibwe Block Model Construction

A sub celled block model was constructed from the wireframes defining the mineralised envelopes and topographic surface. The model dimensions are presented in Table 17.28.

Parameter	Minimum		Maximum
Easting Range		652,990m		655,510m
Northing Range		184,240m		186,520m
Elevation		440m		610m
Easting Block Size		20m		2m
Northing Block Size		20m		2m
Elevation Block Size		5m		0.5m

Table 17.28: Dibwe Block Construction Parameters

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17.8.2.2 Dibwe Grade Estimation Parameters

Sample search parameters for Dibwe are tabulated in Table 17.29. The search ellipse was aligned with the dominant domain geometries.

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SEARCH ELLIPSE PARAMETERS SE DOMAIN

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		046/0		046/0		046/0		046/0
DIP		9		9		9		9
RADII 1 RANGE		100		150		300		450
RADII 2 RANGE		65		100		200		300
RADII 3 RANGE		7		10		20		30
Min samples per estimate		5		5		5		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

SEARCH ELLIPSE PARAMETERS CENTRAL DOMAIN

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		052/2		052/2		052/2		052/2
DIP		9		9		9		9
RADII 1 RANGE		100		150		300		450
RADII 2 RANGE		65		100		200		300
RADII 3 RANGE		7		10		20		30
Min samples per estimate		5		5		5		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

SEARCH ELLIPSE PARAMETERS NW DOMAIN

	Run 1		Run 2		Run 3		Run 4
AZI/PLUNGE		065/0		065/0		065/0		065/0
DIP		0		0		0		0
RADII 1 RANGE		100		150		300		450
RADII 2 RANGE		65		100		200		300
RADII 3 RANGE		7		10		20		30
Min samples per estimate		5		5		5		1
max samples per estimate		20		20		20		20
min hole per estimate		3		3		1		1

Table 17.29: Grade Estimation Search Ellipse and Sample Parameters

Octant searching was not used. Grades were interpolated into parent cells so that sub-cells were assigned the value of their parent cell, to reduce adverse volume variance issues. Grades were interpolated into the model using the first run. Blocks which did not receive an interpolated grade were then used in successive runs until all blocks were populated.

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17.8.2.3 Dibwe Model Validation

As for Mutanga, once the grade estimates were completed, the model validations were undertaken and are described below. The comparison of average composite grades with block model grades is contained in the following table (Table 17.30).

	Block		De-Clustered
	U3O8		composite U3O8
Domain	(ppm)		(ppm)		Difference (%)
SE		242		235		+3.0
CENTRAL		231		235		-2.0
NW		133		139		-4.0

Table 17.30: Comparison of Average Composite Grades with Block Model Grades

De-clustered mean composite grades compare favourably with average block grades for each domain. Swath plots showing grade trends in depth, northing and easting in each domain are contained in Figure 17.44.

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Figure 17.44: Swath Plots, All Domains

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The swath plots show that the trends observed in the composite data set are honoured by the block grade data, but with a degree of smoothing. Visual validations were undertaken by reviewing slices through the block model and comparing composite grades to block grades by domain. Screenshots of cross section slices are contained in Figures 17.45 to 17.47.

Figure 17.45: NW-SE Cross Section Through the CENTRAL and SE Domains,

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Figure 17.46: NW-SE Cross Section Through the CENTRAL and SE Domains,

Figure 17.47: NW-SE Cross Section Through the SE, CENTRAL and NW Domains

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The entire wireframe volume, comprising the 23 mineralised zones was compared to the block volume to ensure the wireframe model is honoured and that the tonnage estimate is reliable. This Comparison is summarised in Table 17.31. Results from this comparison show that the difference between the wireframe volume and block model volume is negligible.

	Wireframe		Block Model		Difference
Domain	Volume (m3)		Volume (m3)		(%)
ALL		8,423,537		8,383,616		-0.40

Table 17.31: Wireframe Volume, Compared to the Block Volume

At the completion of the kriged estimate, the estimate was run again using the Inverse Distance Weighting (IDW) interpolation method, raised to the second power. The input data, search parameters and interpolation strategy were identical to the kriged model except that variography was not used. IDW estimates differ from kriged estimates in that they assume a zero nugget, nevertheless they are useful comparative estimates. These two estimation methods are compared in Table 17.32.

	OK		IDW2
	U3O8		U3O8
Material	ppm		ppm		diff %
ALL		234		236		-0.8

Table 17.32: Comparison of Mutanga OK Model and IDW2 Model

It is concluded from the validations performed on the Dibwe resource model, that the estimate of tonnage and grade can be considered reliable, robust and honours the input data used in its creation.

17.9 Mineral Resource Reporting

The Mineral Resource Estimate as at 30 December 2008 presented in this document has been estimated and classified according to recommendations in the CIM Definitions Standards and in accordance with the rules of NI43-101. Classification of a Mineral Resource requires consideration of both the reliability of the sample data and other data used in the estimate, coupled with knowledge of the host geology.

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17.9.1 Classification of the Mutanga and Dibwe Mineral Resource Estimates

Confidence criteria used to classify interpolated blocks includes:

• Interpolation criteria based on sample density, variography, search and interpolation parameters.

• Assessment of the reliability and confidence that can be given to geological, sample, survey and bulk density data used in modelling

• Robustness of the geological model.

• Drilling and sample density.

Recent drilling at Mutanga has tightened the drilling grid to 50m × 50m centres, which has allowed the geometry of deposit domains to be refined. In addition, good variography has provided reliable directions and ranges of grade continuity over the deposit. Results from the variography study indicate the ranges of grade continuity to be 75m in the strike direction and 50m in the dip direction. This base range is sufficient to define Indicated Resources. Blocks which received an interpolated grade during the first run (being informed by at least 5 samples from at least 3 drill holes, at search ranges less than the base range) were classified as Measured Resources. Measured Resources are located in the area of close spaced Geostatistical drilling, within domains MIN2 and MIN3. Blocks that received an interpolated grade during run2 (at distances equal to the range), and form a contiguous volume were classified as Indicated Resources. Those blocks within the model that were captured during interpolation runs 3 and 4 were classified as Inferred Resources. In addition to these criteria, all blocks within the MIN1 domain are classified as Inferred Resources by virtue of the lack of sample data within this domain. All MIN2HG blocks are also classified as Inferred Resources since this domain occupies the escarpment on the NW edge of the deposit where topographic error is at its highest.

Future upgrade of defined Mineral Resources requires:

1.	Improvements in the accuracy of the topographic surface DTM (currently +/-2.5m).
2.	Infill drilling to improve geological and grade continuity so as to increase the confidence that can be applied to the classification of Mineral Resources.
3.	More QAQC data. This is required to further confirm the validity of gamma data used in the resource estimations.
4.	More bulk density data. This is required from each of the domains, in order to improve the tonnage estimate.

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The figure below (Figure 17.48) shows the Mutanga Block Model, coloured by resource class (magenta = Measured, red=Indicated, blue=Inferred).

Figure 17.48: Mutanga Resource Model Coloured by Resource Class.

At Dibwe, recent drilling has brought the drilling grid in to 100m × 50m centres, which has allowed the geological model to be improved and the geometry of deposit to be modified. Recent infill drilling defines the mineralised zones as narrow, semi-continuous, geologically and structurally controlled zones within the three fault bounded domains. Infill drilling has allowed a degree of grade continuity to be established over the deposit though local grade variability remains high. Geological and grade continuity is established to a level sufficient to classify resources over the deposit as Inferred Resources only.

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No resources were classified as Indicated Resources due to:

• The current drill spacing is not adequate to establish geological and grade continuity along strike, to the level required to classify Indicated Resources.

• Additional assay QAQC data is required in order to validate the use of gamma probe data in resource estimation work at Dibwe.

• Deposit specific variography has not been undertaken at Dibwe. In order to increase the confidence in the resource estimate, valid directions and ranges of grade continuity need to be established using Dibwe domain data.

17.9.2 Mineral Resource Tabulations

	U3O8
	Lower		Measured						Indicated						Inferred
	Cut-off		Tonnes		U3O8		U3O8		Tonnes		U3O8		U3O8		Tonnes		U3O8		U3O8
Deposit	(ppm)		(Mt)		(ppm)		(Mlbs)		(Mt)		(ppm)		(Mlbs)		(Mt)		(ppm)		(Mlbs)
Mutanga		100		1.88		481		1.99		8.4		314		5.82		7.2		206		3.3
Dibwe		100		—		—		—		—		—		—		17.0		234		9.0
Total				1.88		481		1.99		8.4		344		5.82		24.2		226		12.3

Table 17.33: Updated Mineral Resource Estimates for Mutanga and Dibwe (2008).

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Figure 17.49: Mutanga Block Model, Coloured by U₃O₈ ppm

Figure 17.50: Dibwe Block Model, Coloured by U₃O₈ ppm.

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	U3O8
	Lower
	Cut-		Measured						Indicated						Inferred
	off		Tonnes		U3O8		U3O8		Tonnes		U3O8		U3O8		Tonnes		U3O8		U3O8
Deposit	ppm		(Mt)		ppm		(Mlbs)		(Mt)		ppm		(Mlbs)		(Mt)		ppm		(Mlbs)
Mutanga		100		1.88		481		1.99		8.4		314		5.82		7.2		206		3.3
Mutanga Ext*		200														0.5		340		0.4
Mutanga East*		200														0.2		320		0.1
Mutanga West*		200														0.5		340		0.4
Dibwe		100								—		—		—		17.0		234		9.0
Total				1.88		481		1.99		8.4		344		5.82		25.4		231		13.2

* Resources for Mutanga Ext, Mutanga East and Mutanga West have not been updated in 2008 and remain current.

Table 17.34: Mutanga Project — Summary of Current Resources as at December 2008

17.9.3 Comparison to previous estimates

The recently completed resource estimate (Tables 17.33 and 17.34, Figures 17.49 and 17.50) was compared to that reported in 2006 (Table 17.2) and this comparison is detailed below. It should be noted that a direct comparison can only be made between that part of the resource termed Mutanga in the 2006 estimate and the recent Mutanga estimate. Mutanga Extensions, Mutanga East and Mutanga West resource areas were not included in the 2008 mineral estimate update but remain current.

The 2006 estimate of resources quotes the Mutanga resource as 7.0Mt at a grade of 400ppm U₃O₈, totalling 6.2Mlbs of U₃O₈, at a 200ppm cut-off. The entire resource was classified as Inferred Resources.

Following infill drilling at Mutanga, the new resource estimate, at a 100ppm lower cut-off is 17.51Mt @ 287ppm U₃O₈ for a total of 11.1Mlbs U₃O₈. This estimate contains 150% more tonnes, at a 28% reduced grade, for a 79% increase in contained uranium compared to that which was reported by CSA in December 2006. In addition and as a result of recent infill drilling, 18% of the estimated resource tonnage is now classified as Measured Resources (11% of resource uranium lbs), 52% as Indicated Resources (48% of uranium lbs) and 30% Inferred Resources (41% of uranium lbs). Following infill drilling at Dibwe, the resource estimate, at a lower cut-off of 100ppm is 17.04Mt @ 239ppm U₃O₈ for 8,967,000lbs U₃O₈. This estimate contains 107% more tonnes, at a 35% reduced grade for a 36% increase in contained uranium compared to the December 2006 model.

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At Mutanga and Dibwe, the significant tonnage increase and grade reduction is as a result of the decision to reduce the cut-off grade from 200ppm (as was used in 2006) to 100ppm following mineral extraction improvements and upgrades which has allowed lower grade mineralization to become economical. Using a 100ppm cut-off has added significant tonnage, diluting the overall grade.

Some additional tonnage can be attributed to the delineation of an additional zone of mineralization at Mutanga, MIN5 that had not been defined in early drilling campaigns. Infill drilling has also allowed the MIN4 domain to be extended by 250m to the NE. Deposit edges have been refined following additional drilling.

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18.0 OTHER RELEVANT DATA AND INFORMATION

18.1 De-mining and UXO Program

In April 2006 a team from MineTech International (MTI) commenced a Level 1 General Mine Action Assessment Survey of the Mutanga camp, proposed Mutanga open pit and plant site areas. The purpose of the assessment was to provide general information and advice to mitigate any risk of landmines or unexploded ordinance (UXOs) to staff, vehicles and equipment engaged in geological prospecting.

In addition to this campaign, Denison completed another two during 2008. The clearing operations located rocket propelled grenades and casings, an anti tank mine and numerous projectiles (i.e. bullets).

Further clearance work is required along the Zyiba Meenda Road as this is the proposed route for the site access road.

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19.0 INTERPRETATION AND CONCLUSIONS

The resource estimates completed in 2006 for the Mutanga and Dibwe deposits were estimated at a 200ppm U₃O₈ lower cut-off grade and classified as Inferred due to the limited understanding of geological continuity, low drilling density and uncertainty surrounding the relationship between the different assay and radiometric methods used to determine the sample U₃O₈ grades. The 2006 resource was not considered for upgrading to the Indicated category due to uncertainty surrounding absolute U₃O₈ grades and low confidence in the local grade estimations, the requirement for clarification on down hole gamma logger grades, the need for increased understanding of the geological controls on mineralisation and mineralogy and the specific locations of the in-situ dry density determinations.

A series of recommendations were outlined by CSA following the 2006 resource estimate, designed to facilitate the upgrade of Inferred Resources to Indicated Resources. These are summarised below:

• Complete infill RC and diamond drilling at both deposits and combine this work with mapping and geological interpretation, so as to continue to enhance the understanding of the geological and structural controls on U₃O₈ mineralisation.

• Complete test work to ensure the cheaper and more effective down hole gamma logging technology can be used to determine down hole U₃O₈ equivalent grades, with the aim of reducing the reliance on time consuming and expensive off-site assay methods.

• Continue to develop an understanding of the mineralogy, metallurgical and communition properties of the potential U₃O₈ ore bearing material by completion of representative metallurgical core drilling and sampling programs.

• Collect additional in-situ dry bulk density data for both the potential ore and surrounding waste material for both Mutanga and Dibwe, so as to improve the tonnage estimate.

Accordingly, the recent drilling (post 2006) campaigns were implemented and steps taken to address the issues and sensitivities outlined in the 2006. A Mutanga, infill drilling on a 50m x 50m grid was completed whilst at Dibwe, 50m infill on 100m spaced cross sections was completed.

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Historical resource estimates for both Mutanga and Dibwe have relied to a large extent on historic chemical assay data, some of which cannot be verified. With the recent infill drilling campaigns the drill hole database has become significantly larger and gamma probe derived e U₃O₈ is the dominant grade data medium.

In order to validate the use of gamma data in resource estimation, check sampling was undertaken of drill material and sent for chemical assay. QAQC analysis of chemical assay data concludes:

• Blanks submitted all performed very well with all samples reporting below detection. This suggests that field sampling methods and contamination-limiting procedures at SGS are adequate.

• Results from the submission of external field standards was mixed.

• Results from internal standards (UREM) was poor overall. Six out of seven standards reported within ±10% of their certified values, but the average percentage error was 11% outside the expected value.

• Although not available at the time the QAQC review was completed, at the time of reporting, spreadsheet data for additional internal laboratory standard reference material, blanks and duplicate samples was received and reviewed. This data suggests internal laboratory QAQC practises to be adequate, but follow up on erroneous UREM samples is recommended. Ongoing monitoring of internal laboratory control alongside external control is highly recommended as part of future drilling programs and should be implemented as a matter of course.. A set of pulp duplicates should be submitted to an umpire laboratory which can then be analysed alongside SGS samples, also testing laboratory precision.

• The number of QAQC samples submitted overall was low (91) and it is advisable that in future drilling campaigns, this number should be increased to be more representative. It is highly advisable that, as a matter of course, QAQC data should be analysed concurrently with drilling. By doing this, if issues arise, it allows for the laboratory to be consulted, samples re-assayed and procedures reviewed if necessary, resulting in problems being resolved at the time and prevented for the rest of the campaign.

Given this small sample population relative to gamma data, direct comparison on an interval-by-interval basis was not considered, not least because available assay data is not representative of all mineralised grade ranges nor spatially representative of each deposit.

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The recent chemical assay QAQC program to validate gamma data against assay data did not return assay grades from all grade ranges exhibited by gamma probe data, and so is considered sub-optimal. Given that comparison on an interval by interval basis could not be undertaken, a more valid approach is to use the comparison of overall population statistics from all assay data and all gamma data, to assess the validity of gamma data for use in resource estimation. It was this approach that was adopted.

The number of recent check assays with which to validate the large amount of gamma data generated during the recent infill drilling campaign is low. In order to increase the level of confidence that can be applied to the indirect method of uranium grade calculation via gamma probing which in turn influences the overall classification of resources, it is recommended that additional check assaying be undertaken, particularly at Dibwe, that ensures not only that returned assays are representative of all grade ranges estimated by gamma probing, but also spatially representative.

Nevertheless, combining recent assay data with validated historic data has allowed a larger sample population to be used to validate gamma data. Statistical analysis suggests the two data populations show similar characteristics and are statistically compatible. These two sample supports are considered reliable for the purposes of resource estimation.

Therefore, following a review of all data held for the project, grade data used in these resource estimation updates comprises all valid data from the recent drilling campaigns as well as chemical assay data from historic drilling campaigns undertaken by Omega/GeoQuest, but omits historical data from previous campaigns undertaken by Agip, in favour of more reliable recent data.

The close spaced drilling (CSD) undertaken during the recent drilling campaign over a 200m × 200m portion of the deposit straddling domains MIN2 and MIN3 (see Figure 17.11 and Figure 17.28) provides useful data with which to model variography using a close spaced dataset, that may be more representative of grade continuity over both domains. Accordingly, variograms were modelled using this data, which resulted in well behaved variograms that described the grade continuity directions and ranges reliably and which honour the general strike and dip of the mineralised zones in these domains.

Although the updated topographic surface is an improvement over historical data held, the 5m contoured data does not include spot heights and as such, topographic highs are shown as flat contours resulting in potential elevation inaccuracies, especially at relatively high levels. Draped collar elevations are accurate to +/- 2.5m at lower levels and +/- 5.0m at higher elevations. It is recommended that spot height data be sourced (from which the contoured surfaces were created) and topographic DTM surfaces be refined using this data, prior to future resource updates.

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It is concluded from the validations performed on the Mutanga resource model, that the estimate of tonnage and grade can be considered reliable and robust and honours the input data used in its creation.

The Mutanga and Dibwe resource estimates have been classified using CIM guidelines and in accordance with the rules of NI43-101. Confidence criteria used to classify interpolated blocks includes:

• Interpolation criteria based on sample density, variography, search and interpolation parameters.

• Assessment of the reliability and confidence that can be given to geological, sample, survey and bulk density data used in modelling.

• Robustness of the geological model.

• Drilling and sample density.

Recent drilling at Mutanga has tightened the drilling grid to 50m × 50m centres, which has allowed the geometry of deposit domains to be refined. In addition, good variography has provided reliable directions and ranges of grade continuity over the deposit. Results from the variography study indicate the ranges of grade continuity to be 75m in the strike direction and 50m in the dip direction. This base range is sufficient to define Indicated Resources. Blocks which received an interpolated grade during the first run (being informed by at least 5 samples from at least 3 drill holes, at search ranges less than the base range) were classified as Measured Resources. Measured Resources are located in the area of close spaced Geostatistical drilling, within domains MIN2 and MIN3. Blocks that received an interpolated grade during run2 (at distances equal to the range), and form a contiguous volume were classified as Indicated Resources. Those blocks within the model that were captured during interpolation runs 3 and 4 were classified as Inferred Resources. In addition to these criteria, all blocks within the MIN1 domain are classified as Inferred Resources by virtue of the lack of sample data within this domain. All MIN2HG blocks are also classified as Inferred Resources since this domain occupies the escarpment on the NW edge of the deposit where topographic error is at its highest.

Future upgrade of defined Mineral Resources requires:

1. Improvements in the accuracy of the topographic surface DTM (currently +/-2.5m).

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2.	Infill drilling to improve geological and grade continuity so as to increase the confidence that can be applied to the classification of Mineral Resources.
3.	More QAQC data. This is required to further confirm the validity of gamma data used in the resource estimations.
4.	More bulk density data. This is required from each of the domains, in order to improve the tonnage estimate.

These sensitivities should be considered when planning additional resource definition drilling to upgrade parts of the resource to higher categories.

At Dibwe, recent drilling has brought the drilling grid in to 100m × 50m centres, which has allowed the geological model to be improved and the geometry of deposit to be modified. Recent infill drilling defines the mineralised zones as narrow, semi-continuous, geologically and structurally controlled zones within the three fault bounded domains. Infill drilling has allowed a degree of grade continuity to be established over the deposit though local grade variability remains high.

Geological and grade continuity is established to a level sufficient to classify resources over the deposit as Inferred Resources only. No resources were classified as Indicated Resources due to:

1.	The current drill spacing is not adequate to establish geological and grade continuity along strike to the level required to classify Indicated Resources.
2.	Additional assay QAQC data is required in order to validate the use of gamma probe data in resource estimation work at Dibwe.
3.	Deposit specific variography has not been undertaken at Dibwe. In order to increase the confidence in the resource estimate, valid directions and ranges of grade continuity need to be established using Dibwe domain data.

These sensitivities should be considered when planning additional resource definition drilling to upgrade parts of the resource to higher categories.

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At Mutanga and Dibwe, the significant tonnage increase and grade reduction is as a result of the decision to reduce the cut-off grade from 200ppm (as was used in 2006) to 100ppm following mineral extraction improvements and upgrades which has allowed lower grade mineralization to become economical. Using a 100ppm cut-off has added significant tonnage, diluting the overall grade.

Some additional tonnage can be attributed to the delineation of an additional zone of mineralization at Mutanga, MIN5 that had not been defined in early drilling campaigns. Infill drilling has also allowed the MIN4 domain to be extended by 250m to the NE. Deposit edges have been refined following additional drilling.

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20.0 RECOMMENDATIONS

The current resource estimates for Mutanga and Dibwe are considered reliable, robust and suitable for inclusion in Feasibility Study work. However, additional infill drilling should be planned for the Mutanga and Dibwe deposits with the objective of upgrading current inferred and Indicated Resources to higher categories. The current drill spacing of 50m × 50m at Mutanga may be sufficient to define Measured Resources over the deposit, based on interpolation and search criteria only. Further Measured Resources can only be classified once sensitivities concerning gamma data validation and topography have been addressed. At Dibwe, the current drill hole spacing of 100m × 50m is not adequate to establish geological and grade continuity along strike for the classification of Indicated Resources.

Following a review of the recent resource updates, CSA are confident that higher category resources can be classified in future resource estimates, with additional infill drilling and/or by addressing data sensitivities, which include;

1.	Ongoing monitoring of internal laboratory control alongside external control is highly recommended as part of future drilling programs and should be implemented as a matter of course. A set of pulp duplicates should be submitted to an umpire laboratory which can then be analysed alongside SGS samples, also testing laboratory precision.
2.	In order to increase the level of confidence that can be applied to the indirect method of uranium grade calculation via gamma probing which in turn influences the overall classification of resources, it is recommended that additional check assaying be undertaken at Mutanga and Dibwe that ensures not only that returned assays are representative of all grade ranges estimated by gamma probing, but also spatially representative. At this time the number of QAQC samples available for comparison is low. It is advisable that in future drilling campaigns, a minimum of 10% of mineralised zone intersections should be sampled and analysed via chemical assay so as to provide a reliable dataset with which to validate the use of gamma data.
3.	CSA recommends Denison acquire aerial survey topographic data and generate contours at 1m intervals at an accuracy of +/- 0.5m for all areas that are potentially required for future mining and infrastructure development. In the short term, current 5m contour spot height data should be sought to further refine the current topography model.

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4.	Additional bulk density sampling should be undertaken and representative samples collected from each domain from a variety of ore types and grade ranges. This information should be incorporated into future resource estimation work to improve the tonnage estimate.
5.	Although the variography study at Mutanga gave reliable variogram parameters that were used in the kriging equations, deposit specific variography has not been undertaken at Dibwe. In order to upgrade Dibwe resources to higher categories, valid directions and ranges of grade continuity need to be established using Dibwe domain data from additional drilling.
6.	The number of QAQC samples submitted overall was low (91) and it is advisable that in future drilling campaigns, this number should be increased to be more representative. It is highly advisable that, as a matter of course, QAQC data should be analysed concurrently with drilling. By doing this, if issues arise, it allows for the laboratory to be consulted, samples re-assayed and procedures reviewed if necessary, resulting in problems being resolved at the time and prevented for the rest of the campaign.

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21.0 REFERENCES

Chisholm, J. and Doepel, J., December 2005, Resource Estimation Mutanga-Dibwe Uranium Project Zambia, Continental Resource Management Pty Ltd (CRM), Internal Report.

Green, JD., 2006 Renewal Application Prospecting Licence LS PL 237 “The Kariba Uranium Project” Southern Province Republic of Zambia, GeoQuest Limited, Internal Report.

Fugro, July 2008, Technical Proposal Helicopter Borne Magnetic Horizontal Gradient (MIDAS^TM) and Radiometric Geophysical Survey Programme Near Lake Kariba,

Zambia, Fugro, Internal Report.

Mwalimu, SM., January 2009, Letter RE Application for Renewal of Large Scale Prospecting Licence - LPL237, Republic of Zambia Mines Development Department, Lusaka, Correspondence.

QEMSCAN, July 2006, QEMSCAN Analysis of 12 U-Ore Samples for U Classification. SGS Lakefield Ore Test — Ref No: BAMF00017a, QEMSCAN, Internal Report.

Titley, M. and Williams, D., August 2006, Announcement to the Australian Stock Exchange: 29 August 2006 JORC Compliant resource Increases by 25% at Kariba Project, OmegaCorp Limited, ASX Website.

Titley, M. and Williams, D., November 2006, Announcement to the Australian Stock Exchange: 13 November 2006 Scoping Study Confirms Strong Cash Margins Expected from Kariba Project, OmegaCorp Limited, ASX Website.

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22.0 DATE AND SIGNATURE PAGE

The following people are responsible for supervising and or preparing this report:

Name :	Malcolm Titley
Degree and Professional Association:	BSc, MAusIMM, MAIG
Position:	Principal, CSA Global (UK) Ltd
Signuature:
Date:	19 March 2009

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23.0  ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT PROPERTIES AND PRODUCTION PROPERTIES

There are no additional data or information relating to this section.

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24.0 ILLUSTRATIONS

All illustrations for this report have been included in appropriate sections.

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25.0 CERTIFICATES AND CONSENTS

2 Peel House, Barttelot Road
Horsham, West Sussex RH12
1DE United Kingdom

Phone: + 44 1403 255 969
Fax:     + 44 1403 240 896
Email: csauk@csaglobal.com

19 March 2009

Certificate of Qualification and Non Interest

I, Malcolm Titley, do certify the following:

• That I am a Principal of CSA Global UK Ltd (CSA) with the office at 2 Peel House, Barttelot Road, Horsham, West Sussex, RH12 1DE, United Kingdom.

• That I am a graduate of the University of Cape Town, South Africa, with a degree of Bachelor of Science, Geology & Chemistry (1979).

• That I have practised my profession as a geologist in the minerals industry for twenty seven (27) years. o That I am a member in good standing of the Australasian Institute of Mining and Metallurgy (AusIMM) and the Australasian Institute of Geoscientists (AIG).

• That I am a “Qualified Person” for purposes of National Instrument 43-101 (“NI 43-101”).

• That I am the author of the technical report titled ‘NI43-101 Technical Report, The Mutanga Project.

• That I am responsible for the preparation of all sections of the Technical Report and have had no prior involvement with The Mutanga Project.

• That, as of the date of this certificate, to the best of my knowledge, information and belief, the Technical Report contains all scientific and technical information that is required to be disclosed to make the technical report not misleading.

• That I have read the NI 43-101, Companion Policy 43-101CP and Form 43-101F1 and the statement of resources in the Technical Report is in compliance with NI 43-101 and Form 43-101F1.

Yours sincerely,

Malcolm Titley
Principal Consultant
CSA Global (UK) Ltd

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2 Peel House, Barttelot Road
Horsham, West Sussex RH12 1DE
United Kingdom

Phone: + 44 1403 255 969
Fax:     + 44 1403 240 896
Email: csauk@csaglobal.com

19 March 2009

Ontario Securities Commission
British Columbia Securities Commission

Dear Sirs/Mesdames,

Consent of Expert

Malcolm Titley,

The undersigned has been responsible for preparing or supervising the preparation of all of the Technical Report The Mutanga Project to be filed with the above listed securities commissions by Denison Mines Corp. Pursuant to Section 8.3 of National Instrument 43-101 – Standards of Disclosure for Mineral Projects, this letter is filed as the consent of the undersigned to the public filing of such Technical Report and to extracts from or a summary of, the Technical Report in the news release dated 19 March 2009 (the “Disclosure”). The undersigned confirms that he has read the Disclosure and that the Disclosure fairly and accurately represents the information in the Technical Report and the Technical Report supports the Disclosure.

Yours sincerely

Malcolm Titley
Principal Consultant
CSA Global (UK) Ltd

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Appendix 1: Examples of Core Logging Schemes and Field Sheets

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Selected examples of detailed logging sheets from diamond drill hole number DMD 78000-03.

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Selected examples of detailed logging sheets from RC hole number DMC 75600-03.

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Appendix 2: Drill Core Handling Procedure

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1- Drill hole logging procedures at Mutanga are:

a.	Hole is drilled.
b.	Hole is probed.
c.	Core is brought to core yard.
d.	Core yard supervisor records core location, date etc.
e.	Core is washed.
f.	Trays are laid out in order.
g.	Gamma probe data is processed.
h.	Gamma probe data is printed in WellCAD and Gamlog,
i.	Geologist interprets lithologies, structures and mineralisation in Gamlog (i.e. at 10cm resolution) WITHOUT reference to the core (yet),
j.	Geologist and core yard technician inspect the core; objective is for Geologist to locate the lithologies, structure(s) and mineralisation identified in Gamlog in the core,
k.	Geologist to check whether the core block depths correlate with these features,

i.	If OK, proceed to step 1,
ii.	If there are errors, geologist is to use a TEMPORARY marker (eg lead pencil) and, moving up and down from the feature, make metre marks on the core all the way to the next feature OR until the depths tally with the core blocks,
iii.	Repeat the previous step up and down from the each feature until the temporary marks are aligned. Only when this happens can it be said that the core depths correlate with the gamma probe depths,

l. Using a permanent marker, mark the depth on the core with large, clear lines and arrow heads as shown in the diagram,

i. Core yard technician(s) to calculate and record the following STRAIGHT INTO DH Logger (NO PAPER COPIES OR INTERMEDIATE SOFTWARE eg EXCEL):

1.	Core recovery,
2.	Longest piece,

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3. Scintillometer readings:

NOTE: SCINTILLOMETER READINGS ARE TO BE ENTERED DIRECTLY INTO DHLogger – NO pieces of paper, NO subsequent data entry and NO intermediate software (eg Excel)

a.	At 50cm intervals IN THE TRAY – do not remove (because there is no way of ensuring that each piece sampled will be the same size),
b.	When a reading exceeds 700cps, takes readings every 10cm up and down to the next 50cm mark.

ii. Core yard technician to mark each core tray with the following:

1.	On end and long side: Hole ID, Tray Number, Depth From, Depth To. (Add yellow sticker (if available) with this information on the end).
2.	On upper side, top box edge: Hole ID, Tray Number, Depth From.
3.	On upper side, bottom box edge: Depth To.

iii.	Geologist check outs drill log to laptop; now ready to log core.
iv.	Geologist logs the core:

1. Lithology (major and minor)

a.	Escarpment Grit Formation Package C à B boundary
b.	Escarpment Grit Formation Package B à A boundary
c.	Escarpment Grit Formation Package A à Madumabisa Mudstone boundary
d.	Correlatable mudstone boundaries (in accordance with cross section information)
e.	Other significant, unusual or potentially correlatable lithologies.

2. Alteration:

a. Identify zones of limonite, hematite and goethite by colour.

3. Structure

a.	Alpha angles
	Most core is too broken to permit orientation marks and lines so the collection of beta angles (i.e. angle of rotation against a line running down the bottom of the hole is difficult – or not possible. Thus, record the alpha angles, i.e. the angle to the long core axis. Try to record at least one bedding plane per tray – as well as every measurable contact between the key lithologies.

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b.	Fault(s)
c.	Other significant, unusual or potentially correlatable structures.

4. Mineralisation (in conjunction with WellCAD and Gamlog data)

a.	Confirm/refute high grade zones (i.e. +700cps) as indicated by the scint data.
b.	Attempt to identify ore mineral species and habit.

5. Any other information or comments.

v. Geologist returns to the office.

1.	Adds the collar survey data,
2.	Adds drill hole summary.
3.	Checks the hole into the Central database.

vi. MEANWHILE the core trays are photographed

1.	Dry, then
2.	Wet.

vii. The photography technician:

1.	Downloads the core photos to the server and
2.	Edits the file name to show Hole ID, Depth From, Depth To and Wet or Dry.

viii. The core yard technician:

1.	Stacks the core into the racks,
2.	Notes the Shed, Row, Bay and shelf number,
3.	Enters this data into DHLogger.

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Appendix 3: Down Hole Geophysics Procedure

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This procedure is followed by trained technicians at site; under supervision of a project geologist as required.

• When doing the down hole geophysical logging some tools which are required are:

• Computer (Laptop) with the

• matrix Soft ware

• Matrix and Winch Probe (probing tool)

• Power (Generator)

• Docking station for the Laptop to cool it and charge it at the same time.

• The power supply cables are connected to the Matrix and the Winch

• The USB cable is connected between the computer and the matrix.

• the 19 pin single cable should be connected to the matrix and the winch because it brings data from the winch to the matrix

• The bulk head is cleaned and well connected to the probe because when these two are connected together they will be able to bring information from the probe itself to the computer.

• After all the connections are done open the matrix soft ware in your computer by double clicking•

• Click the arrow pointing down in the tool panel to select the tool you are using.

• Give power to the tool you are using by clicking ON in the tool panel and test if the tool is receiving power by clicking ON in the Acquisition panel

• Zero the tool by clicking the sign of maximizing in the depth panel on top right side

• Pull the list box to select either going up or down and click ON that is in the acquisition panel. Also to write the Hole ID click the black dot , after then save it and run the winch

• to stop “click the black squire in the acquisition panel” and check the data

• The maximum speed should be 5.0m per minute if more that more errors will appear and the data will be bad.

• To Close the programme right on the depth

• on the dash board there are six panels namely:

• Depth panel

• Tool panel

• Telemetry panel

• Acquisition

• Browsers And processor panel

• Status Panel

1.	Depth panel
	The depth panel displays depth information and logging speed, it also allows the user to change the depth value and zero the tool before beginning the logging run.

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2. Tool panel:

	Displays the currently selected tool type .It also displays the actual tool power supply voltage and current consumption. It also gives the control of tool specific function such as caliper. It provides the means to switch to power ON and OFF.
3.	Telemetry panel:
	It shows the information about the data sampling and provides the facility to tune communication setting as appropriate. There are three led panel which displays;

I.	Data sec: rate of data sampling.
II.	Data: Indicates the number of data samples read unique to a recording or in the replay session.
III.	Errors: Counts the error or number of times during the acquisition that the system failed to obtain valid data upon request. When data is not correctly received, the status led shows red.
•	A tab labelled “setting” allows you to set the type of winch, which may be used.

4.	Acquisition panel:
	This panel is used to select data recording modes; set sampling rate, start and stop data recording. There are options to select through the drop down menu and these are;

• Time

• depth up

• Depth down.

5.	Browser and processer panel:
	This controls starting and stopping of client processor which consists of applications that support such function as data processing on screen display and printing.
6.	Status panel:
	This displays the status of the various component of the logging system, where a green light indicates correct operation and a red light indicate an error.

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Appendix 4: Gamma Probe Calibration Data (2007-2008)

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Gamma Probe Calibration Data from the 2007-2008 Omega Drilling Campaign. This appendix comprises internal Omega e-mail communication detailing gamma probe calibration data in the US and on-site via test hole probing, and associated discussion. This information is referred to in Section 17.3.2.

TO:	Roger Staley
CC:	all other users
From:	Ken Sweet
Subject:	Gamma Calibration
Date:	20 August 2008

The calibration numbers below are to be used for uranium calculations. Drill holes logged before Aug 2008 should continue to use the old numbers.

Grade=Cal*CPS

Of course corrections must be made for dead time and bole conditions.

Calibration factors to use as of 20 August 2008

Tool	Cal		Dead		N3		U3		U2		U1		Date/Location
2PGA3732_2PEA3742		1.19E-05		7.40		17330		29548		58347		86393	Oct 2007/GJ
2PGA4184_2PEA4073		1.26E-05		6.90		16245		28060		57286		85465	Aug 2008/GJ	Repaired
2PGA3443_2PEA3449		1.23E-05		7.25		16990		29003		58330		86525	May 2008/GJ
2PGA4296_2pea4340		1.22E-05		7.30		17032		29223		58213		86156	Aug 2008/GJ	New tool

Tool 2PGA4184_2PEA4078 was sent back to the manufacture for repair. Water had leaked into the tool.

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Calibration factors to use as of 31 May 2008

Tool	Cal		Dead		N3		U3		U2		U1		Date/Location
2PGA3732_2PEA3742		1.19E-05		7.400		17330		29548		58347		86393	Oct 2007/GJ
2PGA3732_2PEA4078		1.20E-05		7.200		17349		29588		58978		86251	Oct 2007/GJ
2PGA4184_2PEA3742		1.23E-85		6.600		17302		29591		60114		91485	Oct 2007/GJ
2PGA4184_2PEA4078		1.23E-05		6.600		17222		29581		60208		91339	Oct 2007/GJ
2PGA3443_2PEA3449		1.23E-5		7.25		16990		29003		58330		86525	May 2008/GJ

Tool 2PGA3443_2PEA3449 malfunctioned and was returned to Mr. Sopris for repairs. After the repair the tool was recalibrated at Grand Junction, Colorado, USA. The old and new calibration factors are shown below. There is very little difference, the tool has not changed.

Holes logged prior to the repair, May 2008 should use the Oct 2007 factors shown below. New logging should use the new factors, May 2008. Pipe factors and water factors have not changed.

Tool	Cal		Dead		N3		U3		U2		U1		Date/Location
2PGA3443_2PEA3449		1.25E-5		7.30		17330		29548		58347		86393	Oct 2007/GJ
2PGA3443_2PEA3449		1.23E-5		7.25		16990		29003		58330		86525	May 2008/GJ

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TO:	Roger Staley
CC:	all other users
From:	Ken Sweet
Subject:	Gamma Calibration
Date:	20 August 2008

As part of the continuing log quality control program drill hole MTD52050-05 has been logged several times to check the consistency of the grade calculations.

Individual zones have not been compared. I have compared the mineralization from 15.95 meters to 30.5 meters. Using a thick mineralized zone minimizes any depth errors and provides a good statistical comparison.

				Avg		GT		%
Tool	date	Thick		PPM		(M*PPM)		variation
2PGA4184_2PEA4078	10-Mar-08		14.10		284		401		2.0	%
2PGA3443_2PEA3449	10-Mar-08		14.10		289		407		3.6	%
2PGA3732_2PEA3742	10-Mar-08		14.10		290		409		4.0	%
2PGA4184_2PEA4078	14-Apr-08		14.10		288		406		3.4	%
2PGA3443_2PEA3449	14-Apr-08		14.10		302		426		8.4	%
2PGA3732_2PEA3742	14-Apr-08		14.10		296		418		6.3	%
2PGA3443_2PEA3449	5-Jun-08		14.10		247		348		-11.4	%
2PGA3443_2PEA3449	12-Aug-08		14.10		245		345		-12.1	%
2PGA3732_2PEA3742	20-Aug-08		14.10		267		376		-4.2	%
		Average=			279		393

Two tools are being shipped back this week with new calibrations. As soon as the tools arrive in Zambia we will relog the holes and make another comparison.

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TO:	Japhet
CC:	Roger, Logging operators, Geologists
Subject	Comparison of tools 2PGA4296_2PEA4340 and 2PGA4184_2PEA4078
From:	Ken Sweet
Date:	11 Sept 2008

You sent me two logs of drill hole MTD51900-04 logged with the two newly calibrated logging tools, 2PGA4296_2PEA4340 and 2PGA4184_2PEA4078. You send me the raw data, the gamlog printout, and your comparison spreadsheet. You did a good job.

I have redone the spreadsheet so it is easier for me to compare the data. My copy is attached.

The best way to compare is to sum the entire mineralized zone. Individual 10 cm measurements can be different, the tool position might be little different.

Here the comparison is excellent:

	Sum of grades			Tool
Sum grades 0.5-14.0=		90143		2PGA4296_2PEA4340
Sum grades 0.5-14.0=		89326		2PGA4184_2PEA4078
Percent difference		0.9	%

I would like to see the data from the bent tool in this hole.

We need to log all three tools in drill hole DH MTD52050.

As you said in your Skype chat we should survey the hole 1 time per month. We should schedule for the first day of each month.

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Appendix 5: Reduced Area Boundary PL LS 237

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	Deg.Min.Sec				ARC1950 35S
ID	Longitude		Latitude		East		North		Description
A		28.13.06		-16.33.00		630000.0		8169992.0	Due west of U
B		28.13.06		-16.30.06		630032.3		8175339.2	Due north of A
C		28.15.06		-16.27.54		633615.6		8179374.0	Diagonally (45 degrees) from B
D		28.17.12		-16.27.36		637355.9		8179903.7	Diagonally (85 degrees) from C
E		28.19.12		-16.24.12		640955.7		8186150.0	Diagonally (35 degrees) from D
F		28.19.12		-16.22.06		640980.9		8190022.3	Due north of E
G		28.24.30		-16.18.06		650467.8		8197334.8	Diagonally (45 degrees) from F
H		28.28.12		-16.16.42		657076.1		8199869.9	Diagonally (50 degrees) from G
I		28.34.06		-16.13.30		667630.8		8205692.7	Diagonally (45 degrees) from H
J		28.42.30		-16.11.06		682635.1		8209999.1	Diagonally (40 degrees) from I
K		28.42.30		-16.11.06		682635.1		8209999.1	Due East of J
L		28.33.18		-16.22.18		666081.8		8189475.9	Diagonally (210 degrees) from K
M		28.37.42		-16.26.54		673847.8		8180931.6	Diagonally (150 degrees) from L
N		28.32.12		-16.31.06		664000.0		8173263.0	Diagonally (215 degrees) from M
O		28.26.12		-16.32.24		653308.5		8170944.6	following the lake outline
P		28.22.42		-16.32.24		647082.7		8170988.1	Due west of O
Q		28.23.00		-16.31.48		647623.9		8172090.9	following the lake outline
R		28.25.12		-16.29.18		651570.0		8176673.6	Diagonally (45 degrees) from Q
S		28.24.18		-16.28.30		649978.9		8178160.0	Diagonally (315 degrees) from R
T		28.20.30		-16.31.42		643177.9		8172305.3	Diagonally (220 degrees) from S
U		28.16.00		-16.33.00		635158.0		8169960.1	following the lake outline
A		28.13.06		-16.33.00		630000.0		8169992.0	Due west of U

Table 4.1(a): Co-ordinates of PL LS 237 6 January 2009

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EX-3

Exhibit 3

March 12^th, 2009

British Columbia Securities Commission
Alberta Securities Commission
Saskatchewan Financial Services Commission
The Manitoba Securities Commission
Ontario Securities Commission
Autorite des marches financiers
New Brunswick Securities Commission
Nova Scotia Securities Commission
Prince Edward Island — Department of Provincial Affairs and Attorney General Securities Division, Department of Justice — Government of Newfoundland and Labrador

Dear Sirs/Mesdames,

CONSENT of EXPERT

Re: Denison Mines Corp (the “Company”) — Filing of Technical Report dated March 12^th, 2009

I, Malcolm Titley, BSc (Geology & Chemistry), MAusIMM, MAIG., consent to the public filing of the technical report titled “Technical Report on the Mutanga Project, located in the Southern Province, Republic of Zambia” (the “Technical Report”) prepared by CSA Global (UK) Ltd.

I further confirm that I have read the written disclosure in the Company’s news release entitled “DENISON ANNOUNCES NI 43-101 RESOURCE ESTIMATE ON MUTANGA PROJECT, ZAMBIA” dated March 12, 2009 and confirm that it fairly and accurately represents the information in the Technical Report that supports the disclosure. This letter is provided to the securities regulatory authorities to whom it is addressed pursuant to the requirements of applicable securities legislation, and not for any other purpose.

Yours sincerely

Malcolm Titley
Principal Consultant
CSA Global (UK) Ltd

Statement of Consent www.csaglobal.com

EX-4

Exhibit 4

Denison Mines Corp.
Atrium on Bay, 595 Bay Street, Suite 402
Toronto, ON M5G 2C2
Ph. 416-979-1991 • Fx. 416-979-5893 • www.denisonmines.com

PRESS RELEASE

DENISON MANAGEMENT CHANGE

Toronto, ON — March 23, 2009... Denison Mines Corp. (DML:TSX) (NYSE Amex:DNN) (“Denison” or the “Company”) reports that at the Annual Meeting of Shareholders on April 30, 2009, Mr. E. Peter Farmer will step down as Chief Executive Officer and as a Director of the Company. Candidates to replace Mr. Farmer have been identified and a search for other candidates has commenced.

Mr. Farmer has been with the Company since 1985 and has indicated that it is time for a change in leadership at Denison and the Annual Meeting is an appropriate time for this change.

Mr. Farmer said, “it has been a privilege to be a part of Denison and its exceptional Boards of Directors, officers and employees for 24 years. I thank them all for their dedication and loyalty to the company. It is time for me to pursue with more vigour, the many other activities I enjoy.”

Under Mr. Farmer’s leadership, Denison has grown to become a premier mid-tier uranium producer in North America. He has presided over the Company through good times as well as challenging times in the uranium market and throughout all cycles Denison has always maintained a reputation for excellence, dependability, and superior corporate governance.

The Board of Directors would like to thank Mr. Farmer for his outstanding contribution to Denison over the years. His dedication and loyalty to the Company are greatly appreciated and we wish him all the best in his future endeavours.

Lukas H. Lundin, Chairman of Denison, commented, “The Company is highly regarded and respected in the industry and that is due in no small part to Peter’s work over the years. I would like to express my personal gratitude to him and wish him the very best.”

About Denison

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. Further, the Company has ownership interests in two of the four conventional uranium mills operating in North America today. Denison also has a strong exploration and development portfolio with large land positions in the United States, Canada, Mongolia and Zambia.

For more information, please contact

E. Peter Farmer	(416) 979-1991 Extension 231
Chief Executive Officer
Ron Hochstein	(416) 979-1991 Extension 232
President and Chief Operating Officer
James R. Anderson	(416) 979-1991 Extension 372
Executive Vice President and Chief Financial Officer

Cautionary Statements

This news release contains “forward-looking statements”, within the meaning of the United States Private Securities Litigation Reform Act of 1995 and similar Canadian legislation concerning the business, operations and financial performance and condition of Denison.

Forward looking statements include, but are not limited to, statements with respect to estimated production; the development potential of Denison’s properties, including those of its joint ventures; the future price of uranium; the estimation of mineral reserves and resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; capital expenditures; success of exploration activities; permitting time lines and permitting, mining or processing issues; currency exchange rate fluctuations; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; title disputes or claims; and limitations on insurance coverage. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”.

Forward looking statements are based on the opinions and estimates of management as of the date such statements are made, and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Denison to be materially different from those expressed or implied by such forward-looking statements, including but not limited to risks related to: unexpected events during construction, expansion and start-up; variations in ore grade, tonnes mined, crushed or milled; delay or failure to receive board or government approvals; timing and availability of external financing on acceptable terms; actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of uranium and vanadium; possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in the completion of development or construction activities, as well as those factors discussed in or referred to under the heading “Risk Factors” in Denison’s Annual Information Form dated March 28, 2008 available at http://www.sedar.com and its Form 40-F available at http://www.sec.gov. Although management of Denison has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended.

There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Denison does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws. Mineral resources, which are not mineral reserves, do not have demonstrated economic viability. Readers should refer to the Annual Information Form and the Form 40-F of Denison for the year ended December 31, 2007 and other continuous disclosure documents filed since December 31, 2007 available at http://www.sedar.com, for further information relating to their mineral resources and mineral reserves.