I'm Charlotte Mloud with investingnews.com and here today with me is David Kates, president and CEO of Dennis and Minds. Thank you so much for being here. Great to have you. >> Oh, I'm I'm so excited to be here. This conference is uh a very important part of our uh marketing season. >> Yes. For context for everybody, we've made it to day three of PDAC. Maybe we can start with just a quick look at what you've been seeing and hearing on the show floor. I heard it's busy.


>> It has been busy. Uh I was out here Sunday morning. Um look, a lot of positive energy around natural resources in Canada. That seems like an obvious thing, but uh it's a major uh improvement in sentiment that we've seen over past years. Uh the public seems to understand natural resources are an important part of our Canadian economy. Yes, it sounds like people outside the sector are finally starting to come in in a positive way. So, it's great to hear and this is it's our first time


talking, but it's coming really at the perfect time. Just last week, Dennis announced a final investment decision for the Phoenix ISR uranium mine. So, congratulations. Very exciting. And I believe that will make it the first new large-scale Canadian uranium mine in over two decades. So, we can we can see the significance. Maybe you can talk me briefly through that process because we know this doesn't happen overnight. >> Oh, no. Yeah, natural resources is a is a long-term business and our Phoenix


deposit was discovered by Dennis in 2008. Uh we delineated uh made a discovery of another deposit nearby, the Griffin deposit in 2014. And then since then, it's been significant amount of technical derisking, project evaluation. And it was really in 2019 uh 2018 2019 where we made the decision to advance the Phoenix project as an insitue recovery uranium mine and and since then it's been environmental permitting uh permitting environmental um assessments indigenous engagement design engineering


procurement and all of that leading up to our final regulatory approvals to start construction in February and then shortly thereafter that final investment decision. I think it's it's great to just hear all the items that are involved. And it sounds like now that you've made that final investment decision, things can really kick off. It looks like site preparation, construction actually start this month in March. So, can you lay out the next steps for us? >> Yeah, it you know, to be ready to


actually start construction so quickly has been a major accomplishment for us. uh we've we've had a been blessed with a great project and that's what's allowed us to work over these last several years to be at this point where we can execute and owing to that really rigorous uh regulatory process we've had some extra time and that's allowed us to build um detailed plans and so we are truly ready to start construction and as you mentioned we'll start site preparations


and construction this month because our mine's an insitu recovery mine we have a much shorter construction timeline line. We're not sinking a shaft or opening a pit. Uh we're not building a big mill. Uh we're drilling a series of vertical or nearvertical wells uh that are like a water well that'll go from surface into the ore body. And we're building a process plant. Uh we don't have a tailings facility to build and we have a small workforce, so not a large uh sort of work camp either. But what that does


is it means that we're really on a 2-year construction timeline. That's probably in the range of two to three years shorter than if we were building a large underground mine. We also benefit from the fact that we have infrastructure where our project is. We're we're on the road and we have access to power. Um actually Sask Power, the provincial utility has already installed the high voltage connection to the to the main distribution line at our site. And so that helps us to have that


very short construction timeline and puts us on track for first production by middle of 2028. >> Okay. So that's the the time that we'll be looking out for and I think anybody who is involved in the mining industry knows that sometimes the best laid plants can go off track. So how you make sure that you stay on track because of course we need we need that uranium today. >> Well the most important work has probably already happened. Uh detailed design is at a really advanced stage.


We're roughly 90% on total engineering for the project. I mean, for those that maybe aren't as familiar with the mining industry, many mining projects are starting with much lower engineering and the engineering is finished as the build happens. So, we're we're essentially or very close to fully engineered before we start. So, that is is a significant derisker. Um, you know, and then it it's really about leveraging our team that we've built over the last few years. We've onboarded now construction


management firm, which is wood. their uh you know international engineering procurement firm. They have worked with us through the engineering design as well. So that team is not having to ramp up. Uh we're really continuing the work that we've already done and that helps us to ensure that we have as seamless an execution as possible. >> All right. Well, we'll definitely be watching to see how that progresses and I think it's also important to highlight where we are in the uranium cycle, how


>> the mine will be entering into. So let's talk about that. I know experts see very positive long-term fundamentals for the sector due to tight supply, growing demand. Where would you place us in that cycle? >> Yeah, look, we are seeing demand uh evolve at a very rapid rate. Uh global adoption of nuclear power is is happening as fast as it ever has. I've been in the industry 18 years. Uh we have not seen the type of of tailwind for demand uh ever like this. And it's happening after a period of very low


prices. So that's what puts the supply side sort of behind. Um very few projects have had the kind of investment that we've been able to justify in our project. And so we don't have a pipeline of construction ready projects. When you look at global projects that can come to the market um in a meaningful size, you know, multi-million pounds a year production, there are few if any uh other than Phoenix that can come to the market before 2030. And then even the ones that could come sort of in that


post 2030 range, most of them aren't yet incented by prices. We haven't quite got there. There's a few real top tier assets that that are likely to move ahead anyways, but aren't pre2030. And then after that, again, it's the assets that we will need need much higher prices. >> Well, that's a great point. What do you think is the incentive price for for most projects out there at the moment? Well, every every project is is different, right? They'll stack up differently. If we try to search for


that marginal project is the last one to come on, it's it's a bit theoretical, but we can look at the signals from players that don't have the top tier minds, and we can see that there's still hesitation on investment. We can look at Kamo. Uh Kamako has existing producing assets. They have mines that they've already shut and they've not turned back on. So it tells us that those minds and they're not top tier, the ones that are not turned on, but we haven't triggered


those to come on yet. So it's likely that we need that second tier, third tier of asset before we can actually get to that fourth tier asset that is the one that balances the market. So I think we're quite a ways away from it. And again, owing to like a decade plus of low investment, we we don't have this deep pipeline of rich, you know, top tier projects. The other part of our industry that's really curious is that the growth projects, the best ones, they're not in the major miners hands.


If you look at the other commodities, right, gold or copper or any of the base metals, usually the biggest players have the next asset ready to go. In our industry, our big players are Camo, Kazadrom, and Orano. And none of them have top tier, lowcost, largecale assets ready to develop. So we have to rely then on the independent intermediates like Adenison or even beyond us. We're going to be looking at ASX listed companies with with projects in Africa. >> Yeah. Yeah. That is really interesting


and it it raises questions about what the maybe the M&A landscape could end up looking like. Do you think those large producers would want to come in and start lining up their next supply? >> Well, look, some of the producers have have talked extensively about discipline. Uh that's that's an understandable thing because we've gone through a period of very low price. Um but we've also not seen them yet invest in in growth on their own portfolio. So it tells me they're a little bit away


from making that M&A type plunge. But I think that's really to the advantage of the independent intermediates. It allows a company like Denison or even a NextGen to advance an asset to the place where it will be the most valuable before the majors start looking at adding to their project portfolio. >> I want to go back to what you were saying about the market and the prices because we're obviously we're doing so much better in terms of prices than we were a few years ago even. But people


are looking at these positive supply and demand fundamentals and they wonder what is the next catalyst going to be that helps us break higher, maybe get to those better incentive prices. So do you have a a particular point in mind for that? >> Yeah, look in our industry sometimes it requires shock of some degree. Um we've had supply shocks in the past mines, you know, flooded mine that no longer will produce on time, some dramatic events, >> that sort of thing. We've seen demand


shocks, you know, maybe not in a spur-of-the- moment shock, but the growth of China in the last cycle was very rapid and they were very active in buying. I think this time around, um, you know, it's a more natural price discovery process that's going on. So, we are seeing demand come to the market through utilities in contracting and they usually use a request for proposal type uh, you know, structure where they will bid it out to the market. And what we've seen is that prices are moving up


in response to that interest. So they're discovering that the depth of supply isn't there. And to to secure the material they're looking for, they're having to accept higher prices. Now, that's a pretty normal thing, but for our industry, seeing that progress uh more gradually is actually really important because it means we might avoid this concept of a very temporary and and outrageous spike and we may actually work through the process of figuring out what price is necessary for


sufficient supply to meet demand. It's much easier to run your business when you have a predictable or more gradual price move. Yeah. >> And essentially the customers are trying to find the product. If they can't find it, the price moves up and then maybe they've found it. That's that's that's a much healthier way. So I don't think we're going to see well I hope we don't see something too dramatic because it sometimes leads to an unexpected outcome. Mines that shouldn't be built


get built because of a very temporary high price moment. So, I'm hoping that we can avoid that and really discover the necessary price in a more sustained way. >> Right. Right. And utilities, they're such an opaque part of the market for at Phoenix. Are you already having conversations with utilities about the uranium from Phoenix at this point or how does that look? >> Yeah, look, we're active on multiple fronts with future customers. Uh we're a bit unique in that of course we are


talking about supply from Phoenix but we have a large physical holding of uh of uranium already in storage. We purchased 2.5 million pounds U308 in 2021 when the price was sub30 US. Today we have a price that's in the 80 to90 range and we are monetizing some of that to be able to fund our construction at Phoenix. So we're able to offer utilities material over the next 2 years and we also have active production right now from our MLAN lake joint venture where we're producing using the Saber mining method


with our partner Orano. So we're able to market all three of those sources to the customers and we see great interest from from future customers uh primarily because they want to buy Canadian uranium and we have multiple sources of Canadian uranium. Well, and that leads in I did I did want to bring up your other projects as well. So, you mentioned MLAN North. You also have a pretty significant position in the Aabaska Basin. So, how are you going to balance working at your other assets as you move forward at Phoenix? What's the


plan? >> Yeah, Phoenix is critical for us. Phoenix is where we will be focused. Um, it has a very reasonable capex price tag on it, 600 million Canadian. We'll divert our financial resources primarily there. In the background, we're of course staging ourselves with the production profile. So, our Griffin deposit will be moving forward through evaluation and assessment so that we can queue it up to be able to produce and use the cash flow from Phoenix to develop it. Beyond that, we do have a a


very sizable exploration portfolio and we've made multiple investments in other players in the region, primarily juniors, where we've taken assets or projects that we wouldn't necessarily work in the next 3 to 5 years and we've put them into their companies. We still have an interest in the minority a minority interest in the project and we own usually in the range of 20% of their company. So that'd be like a company like Kosa Resources which is TSXV listed foremost clean energy which is NASDAQ


listed and we have an also a significant partnership with Sky Harbor Resources. We have a historical equity position there but we've also formed some new joint ventures basically adjacent to our Wheeler River property. So we'll be exploring as part of our DNA domestically on our projects but also have our partners exploring so that we really are exposed to discovery uh in the region and can add it to our production uh pipeline. >> Well and that is another topic I wanted to cover. So the Atabaska basin that's a


uranium hotspot and I was going to ask if your mind moving forward helps to catalyze other assets in the region and help them get on the way. It sounds like yes. >> Well absolutely. I think Dennis's success is is no doubt success that can that our partner companies can leverage. Uh what we're doing with Phoenix, it will be the first in situ recovery uranium mine in Canada. And so we are opening up a new trail for uh mining in the region and many of the deposits that are being many of the deposits that


could be out there could be amendable to our mining method. But historically uh companies stopped looking for for deposits in the same geological setting where we have Phoenix and that's owing to some of the history around the cigar lake mine which is situated similarly but really struggled with water inflows and flooding during development. Uh, so everyone started to look for basement hosted deposits or sandstone hosted. And I think the fact that we're de-risking this and developing an ISR mine in the


sandstone hosted deposit can open up the frontier of where the juniors and ourselves look for new deposits. You don't need 300 million pounds to make a sandstone hosted deposit work if you're going to use ISR mining. And so the spectrum now of what can be economic is much wider. And I think eventually that will have a benefit because we see people willing to look for those again as opposed to seeking only monstrous deposit sizes, >> right? And that that can be critical for filling that supply gap in that case.


>> Absolutely. Especially when we have shorter development timelines for ISR, you know, again, we're building in two years rather than 5 years. um you know that that's the kind of thing that if we make for example if we or one of our partners makes a discovery of is of an ISR minimal deposit anywhere near our Wheeler River property we absolutely would look at can this be successfully mined as a satellite deposit to our Phoenix plant and the potential then to have a much shorter timeline to get it


to market. >> Well, it sounds like everything is really coming together. I'll send you back out onto the show floor in just a moment, but I want to ask if you have any final thoughts that you would leave uranium investors with. I think they're usually a pretty savvy bunch, but is there anything they should know that they might be overlooking? >> Well, I think the fundamentals are generally appreciated. The test is where will the price go? And you know, I'm not sure that we can always predict that.


So, where we vector back to is what can our company do to generate value for that shareholder regardless of price. And you know I think that's where the investors should be looking is which of these companies will execute and what is their business story. There's a spectrum of companies out there in exploration development uh and it's a tough task actually to be an investor and to sift through that. Uh but quality technical reports uh reasonable economic assessments these are these are clues


for sure about the companies that will succeed regardless of the price. >> All right. Well, thank you so much for coming on to go over everything that's happening at the company as well as developments in the market. This was really valuable. >> Yeah, my pleasure. Thanks for having us. >> Amazing. And once again, I'm Charlotte Mloud with investingnews.com and this is David Aight with Dennis and Mine.