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HomeMy WebLinkAboutDRC-2010-004642 - 0901a068801bb2e5DENISO MINES DRC •2010-004642 August 19, 2010 Denison Mhws (USA) Corp. 1050 17th Street Suits 950 Denver, CO 80265 USA Tol: 303 628-7798 Fax:303 389-4125 www.denlsonminas.coin VIA ELECTRONIC FILE AND OVERNIGHT DELIVERY Mr. Rusty Lundberg Executive Secretary Utah Radiation Control Board Department of Environmental Quality 195 North 1950 West PO Box 144810 Salt Lake City, Utah 84114-4820 BeC9!V8d AUG ::c :u Division of Radiation Conircf Re: Denison Mines (USA) Corp. State of Utah 11e.(2) Byproduct Material License # UTI 900479 White Mesa Mill, Blanding, Utah License Condition Number 9.5 - Surety Update Request for Information, June 16, 2010 Dear Mr. Lundberg: We are responding to the June 16, 2010 Request for Information from Dave Rupp asking for additional clarification on the March 2010 update, Revision 4.1, of the White Mesa Mill reclamation cost estimates. Mr. Rupp's comments are restated below, in italics, followed by our response. Where necessary, replacement pages are provided for inclusion in the March 2010 estimate. These revisions are labeled Revision 4.2, and also include the estimated cost for reclamation of tailings Cell 4B, that was submitted as revision 3.2 in June 2010. 1. Equipment Maintenance. The Equipment Costs spread sheet with the subtitle White Mesa Mill Reclamation Costs, shows that the hourly rate for equipment maintenance dropped from $21.15 per hour in the 2009 estimate to $20.53 per hour in the 2010 estimate. The calculation method to derive the hourly maintenance rate for 2010 is unclear. a. Please explain and justify the derivation ofthe hourly equipment maintenance rate for 2010, or b. Correct the hourly maintenance cost for this estimate. Below is a summary of the hourly maintenance cost utilized in the last three versions of the Reclamation Cost Estimate. The fixed maintenance cost remained the same from the March 2009 estimate to the October 2009 estimate, but the totai equipment hours was increased to take into account the maintenance on the Cat 330 with shear and the two mobile cranes. This equipment will require maintenance attention and was previously excluded from the estimated hours. The fixed maintenance cost remained the same but the hourly cost was Letter to Mr. Rusty Lundberg August 19, 2010 Page 2 down because the total hours had increased. The fixed maintenance cost for the March 2010 estimated increased from $62,315 per month to $65,430. The total equipment hours decreased slightly because the Cat 16H motor grader was removed from the equipment fleet as it was not utilized in any of the estimated tasks. The hourly maintenance cost from the October 2009 estimate to the March 2010 estimate actually increased from $18.58 per hour to $20.53 per hour. Plan Revision Fixed Maintenance Cost Equipment Hours Houriy Cost March 2009 $62,315 3,168 $21.15 October 2009 $62,315 3,964 $18.58 March 2010 $ 65,430 3,788 $20.53 2. Tankage and Spare Parts Removal. On page 4 of the Mill Decommissioning portion of the estimate. Misc. Tankage and Spare Parts Removal costs are shown in a table titled the same. Per DUSA's previous surety letter of October 5, 2009, this table includes only the reclamation of the newly constructed uranium and vanadium SX feed tanks and the SX raffinate tank. However, the reclamation of all the other existing tank systems at the mill appears to be omitted from the March 3,2010 estimate. Please demonstrate that the reclamation of all the existing tank systems at the mill are included in the current estimate with appropriate hours budgeted for each system. If not, please add this work to the estimate. Reclamation of the process equipment, tankage and concrete for the unit operations of the Mill area is included in the estimates for each of the general areas, such as "Mill Building", "Ore Feed", "SX Building", "CCD Circuit", "Sample Plant", "Boiler", etc. The demolition of the actual structure is a relatively small part of the total cost of each of these areas, with the majority of the manpower and equipment time allocated to demolition of the mechanical equipment, tankage and concrete. No salvage of any equipment or materials is assumed and therefore no special care as been assumed for preservation of the integrity of the materials or equipment 3. Insurance. Last year we requested several insurance items be included in the estimate. The Contractor Equipment Floater, Workman's Compensation, and Employer's Liability estimates are acceptable as included in the current estimate. An exception is the estimate for contractor's General Liability submitted in the March 3, 2010 surety update, which we feel needs adjustment We also desire to have insurance for motor vehicles that will be involved in the work, included in the estimate. For these two insurance types, we are requesting that DUSA (and the other Utah U-mills) apply the limits of liability used by the Utah Dept. of Transportation (UDOT), and other adjustments described in paragraphs a and b below: a. General Liability Insurance. Last year we estimated this amount to be between 0.25 and 0.64% of the total project cost An average amount of 0.45% was added to the estimate. We have DENISO MINES Letter to Mr. Rusty Lundberg August 19, 2010 Page 3 discovered this cost range was actually an estimate for Builder's Risk insurance. We are not currently interested in Builder's Risk insurance for the project However, we are interested in budgeting for the general liability insurance we originally intended. The extent of liability and requirements for this insurance must have the following minimum limits of liability: (1) . $1,000,000 Bodily Injury and Property Damage - Each Accident (2) . $2,000,000 General Aggregate (3) . $2,000,000 Products and Complete Operations Annual Aggregate b. Automobile Liability Insurance. Provide Automobile Liability Insurance for claims arising from the ownership, maintenance, or use of motor vehicles involved in project work with the following minimum limits: (1). $1,000,000 Combined single Limit Bodily Injury and Property Damage per Occurrence The costs for these insurance must be documented, based on quotes or reputable cost book figures. Costs for general Liability and auto insurance have been revised based on a quote from Denison's insurance carrier, Aon Reed Stenhouse Inc. Insurance costs were estimated for a 7 year period and have been included as a separate line item in the Cost Summary, replacing the Builder's Risk insurance included in the previous estimate. 4. Reclamation costs for decommissioning, demolishing and disposal of the New Reagent Storage Building needs to in the estimate. Costs for decommissioning, demolishing and disposal of the new reagent storage building have been added to the estimated costs for the Alternate Feed Circuit. 5. Cosfs of pumping, monitoring and disposal after mill closure: a. Slimes drain pumpage for Cells 2, 3, and 4A will be 6.5 years or more. (1) . This adds extra time for pumping facilities and monitoring beyond the 5-years for environmental monitoring already budgeted, which needs to be added to the estimate. The time frame for environmental monitoring has been increased in the estimate from 4.5 years to 7.0 years. (2) . It seems that if reclamation were to begin now, that the tailings ponds would be closed to acceptance of tailings and wastewater. If the White Mesa Mill Tailings Cells are closed to further influent, the costs for a separate pond for storage of pumpage, or other wastewater treatment method will need to be included in the estimate. DENISOl MINES Letter to Mr. Rusty Lundberg August 19, 2010 Page 4 For purposes of reclamation costing we have assumed that the free water from the active tailings cells and the slimes drain pumping will be pumped to the Cell 1 evaporation pond during the early stages of the reclamation activities. Based on the estimated flow rates from the slimes drains in Cells 2, 3, 4A and 4B for the first three years after commencement of reclamation, use of Cell 1 wiil be adequate to contain and evaporate the flow from the slimes drains. For the final dewater effort (years 4 to 7 after commencement of reclamation), a 22 acre lined containment will be constructed on the tailings surface in Cell 4A or Cell 4B, directly on top of the tailings sands. This containment will remain active until the dewatering effort is complete. Costs for construction of this containment have been included under the Miscellaneous category of the cost estimate. b. Costs for treatment of the chloroform and nitrogen plumes at the White Mesa Mill site need to be included in the estimate. Facilities and time for aquifer pumping and related wastewater treatment or disposal pond system must be estimated and justified. A separate wastewater treatment or disposal pond system from the slimes drainage may be needed. It may not be feasible to co-mingle wastewater from the chloroform and nitrogen plumes with slimes drain wastewater pumpage discussed above. The current average flow rate from pumping of five (5) chloroform wells totals 4.1 gallons per minute. This volume will continue to be pumped to the evaporation cell, Cell 1, until the 22-acre secondary solution containment described above is available. Thereafter, it will be pumped into that containment. Based on the estimated flow rates from the Cell 2, 3, 4A and 4B slimes drains and from the five chloroform pumping wells, there will be adequate space and evaporative capacity in that containment for the pumped chloroform water. The Preliminary Corrective Action Plan ("CAP") submitted to the State in 2007 proposes continued pumping of the wells for an indeterminate period of time, followed by monitored natural attenuation. The current pumping costs are incidental to Mill operations. We currently believe it is reasonable to assume that the chloroform concentration in the groundwater will be reduced by the pumping to levels suitable for natural attenuation within the seven-year time frame assumed for dewatering of the tailings cells. The annual incremental cost of pumping over these seven years is negligible and would fall under the Miscellaneous category of the cost estimate. Denison also submitted the Nitrate Contamination Investigation Report to the State on December 30, 2009 concerning the apparent nitrate and chloride contamination to the north of the Mill facility, with evidence pointing to an offsite source of the contamination. At this time Denison does not believe the nitrate/chloride contamination is from Mill operations or other activities controlled by Denison and we should not be held accountable for any future cleanup costs. No additional costs have been included in the reclamation estimate with respect to this contamination. 6. Potential Closure of monitoring well WW2. DUSA is required to submit a plugging and closure plan in Part I.H.3 ofthe imminent Ground Water Discharge Permit to address the possibility of hydraulic interconnection ofthe chloroform plume and the deep aquifer (tribal drinking water supply). Please include the costs for this plan and implementation in the estimate. Denison is currently working with drilling contractors to evaluate procedures for rehabilitating WW2 for continued use as a water supply well. The well currently provides potable water to the Mill facility and is a valuable asset. Denison fully expects to successfully rehabilitate this well to the State's satisfaction, but in the interim we have included estimated plugging and abandonment costs under the Miscellaneous category. DENISO MINES Letter to Mr. Rusty Lundberg August 19, 2010 Page 5 If you have any additional questions or comments, please feel free to contact me. Yours very truly, DENISON MINES (USA) CORP. <Jo Ann Tischler Director, Compliance and Permitting cc: Ron F. Hochstein Harold R. Roberts David C. Frydeniund Rich E. Bartlett David Turk DENISO MINES Dmbon Mines (USA) Corp. 1050 17th Straat, Suita 950 DE NI SON m USA MINES Tel: 303 628-7798 Fax: 303 389-4125 www.denisonmlnes.com Attachment C White Mesa Mill Reclamation Plan Revision 4.2 Revised Cost Estimates for Reclamation of the White Mesa Mill and Tailings Management System August 2010 state of Utahlle.(2) Byproduct Material License # UT1900479 ^ Copy 1 State of Utah Denison Mines (USA) Corp. I lOSO 17th street, Suite SSO I Tel : 303 628-7798 www.danlsonmines.coni | Denver, CO, USA 80265 | Fax: 303 389-4125 Cost Summary WHITE MESA MILL RECLAMATION COST ESTIMATE August 2010 Revision 4.2 Mill Decommissioning $2,074,022 Cell 1 $1,696,333 Cell 2 $1,579,075 Cell 3 $2,041,413 Cell 4A $1,336,754 Cell 4B $1,325,780 Miscellaneous $3,295,240 Subtotal Direct Costs $13,348,617 Profit Allowance 10.00% $1,334,862 Contingency 15.00% $2,002,293 Licensing & Bonding 2.00% $266,972 UDEQ Contract Administration 4.00% $533,945 Contractors Equipment Floater $82,250 General liability Insurance $284,600 Long Term Care Fund $797,448 Total Reclamation $18,650,986 Revised Bond Amount $18,650,986 8/19/2010 - 2:24 PM - WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill Mill Decommissioning MILL DECOMMISSIONING MILL DECOMMISSIONING Mill Building Demolition Resource Description Units Cost/Unit Task Units Task Cost hrs $18.94 720 $13,636 hrs $16.53 640 $10,577 hrs $12.51 320 $4,002 hrs $1.35 960 $1,296 hrs $93.53 640 $59,860 hrs $16.67 640 $10,671 hrs $133.14 160 $21,302 hrs $128.07 160 $20,491 hrs $151.36 160 $24,218 hrs $78.10 160 $12,497 hrs $51.46 80 $4,117 hrs $20.53 1,360 $27,925 sf $3.30 37,500 $123,750 Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 60 Ton Crane 30 Ton Crane Equipment Maintenance (Butler) Concrete Removal Total Mill Building Demolition Ore Feed Demolition Resource Description Units Cost/Unit Task Units $334,341 Task Cost hrs $18.94 48 $909 hrs $16.53 64 $1,058 hrs $12.51 32 $400 hrs $1.35 96 $130 hrs $93.53 64 $5,986 hrs $16.67 64 $1,067 hrs $133.14 16 $2,130 hrs $128.07 16 $2,049 hrs $151.36 16 $2,422 hrs $51.46 0 $0 hrs $20.53 112 $2,300 Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 30 Ton Crane Equipment Maintenance (Butler) Total Ore Feed Demolition SX Building Demolition Resource Description Units Cost/Unit Task Units $18,450 Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 60 Ton Crane 30 Ton Crane Equipment Maintenance (Butler) Concrete Removal Total SX Building Demolition hrs $18.94 240 $4,545 hrs $16.53 320 $5,288 hrs $12.51 160 $2,001 hrs $1.35 480 $648 hrs $93.53 320 $29,930 hrs $16.67 320 $5,336 hrs $133.14 80 $10,651 hrs $128.07 80 $10,246 hrs $151.36 80 $12,109 hrs $78.10 0 $0 hrs $51.46 0 $0 hrs $20.53 560 $11,498 sf $3.30 55,970 $184,701 $276,953 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING CCD Circuit Removal Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 60 Ton Crane 30 Ton Crane Equipment Maintenance (Butler) Concrete Removal Total CCD Circuit Removal hrs $18.94 135 $2,557 hrs $16.53 120 $1,983 hrs $12.51 60 $750 hrs $1.35 180 $243 hrs $93.53 120 $11,224 hrs $16.67 120 $2,001 hrs $133.14 30 $3,994 hrs $128.07 30 $3,842 hrs $151.36 30 $4,541 hrs $78.10 30 $2,343 hrs $51.46 15 $772 hrs $20.53 255 $5,236 sf $3.30 15,000 $49,500 $88,986 Sample Plant Removal Resource Description Units Cost/Unit Task Units Task Cost hrs $18.94 24 $455 hrs $16.53 32 $529 hrs $12.51 16 $200 hrs $1.35 48 $65 hrs $93.53 32 $2,993 hrs $16.67 32 $534 hrs $133.14 8 $1,065 hrs $128.07 8 $1,025 hrs $151.36 8 $1,211 hrs $51.46 0 $0 hrs $20.53 56 $1,150 sf $3.30 4,200 $13,860 Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 30 Ton Crane Equipment Maintenance (Butler) Concrete Removal Total Sample Plant Removal $23,085 Boiler Demolition Resource Description Units Cost/Unit Task Units Task Cost hrs $18.94 120 $2,273 hrs $16.53 160 $2,644 hrs $12.51 80 $1,000 hrs $1.35 240 $324 hrs $93.53 160 $14,965 hrs $16.67 160 $2,668 hrs $133.14 40 $5,326 hrs $128.07 40 $5,123 hrs $151.36 40 $6,054 hrs $78.10 0 $0 hrs $51.46 0 $0 hrs $20.53 280 $5,749 sf $3.30 2,900 $9,570 Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 60 Ton Crane 30 Ton Crane Equipment Maintenance (Butler) Concrete Removal Total Boiler Demolition $55,696 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING Vanadium Oxidation Circuit Removal Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears 60 Ton Crane 30 Ton Crane Equipment Maintenance (Butler) Concrete Removal Total Vanadium Oxidation Circuit Removal hrs $18.94 48 $909 hrs $16.53 64 $1,058 hrs $12.51 32 $400 hrs $1.35 96 $130 hrs $93.53 64 $5,986 hrs $16.67 64 $1,067 hrs $133.14 16 $2,130 hrs $128.07 16 $2,049 hrs $151.36 16 $2,422 hrs $78.10 0 $0 hrs $51.46 0 $0 hrs $20.53 112 $2,300 sf $3.30 1,200 $3,960 $22,410 Main Shop/Warehouse Demolition Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears Equipment Maintenance (Butler) Concrete Removal Total Main Shop/Wareiiouse Demolition hrs $18.94 96 $1,818 hrs $16.53 128 $2,115 hrs $12.51 64 $800 hrs $1.35 192 $259 hrs $93.53 128 $11,972 hrs $16.67 128 $2,134 hrs $133.14 32 $4,260 hrs $128.07 32 $4,098 hrs $151.36 32 $4,844 hrs $20.53 224 $4,599 sf $3.30 19,300 $63,690 $100,591 Decon Pads (2) Demolition Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears Equipment Maintenance (Butler) Concrete Removal Total Decon Pads (2) Demolition hrs $18.94 48 $909 hrs $16.53 64 $1,058 hrs $12.51 32 $400 hrs $1.35 96 $130 hrs $93.53 64 $5,986 hrs $16.67 64 $1,067 hrs $133.14 16 $2,130 hrs $128.07 16 $2,049 hrs $151.36 16 $2,422 hrs $20.53 112 $2,300 sf $3.30 1,350 $4,455 $22,905 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING Office Building Demolition Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears Equipment Maintenance (Butler) Concrete Removal Total Office Building Demolition hrs $18.94 72 $1,364 hrs $16.53 96 $1,587 hrs $12.51 48 $600 hrs $1.35 144 $194 hrs $93.53 96 $8,979 hrs $16.67 96 $1,601 hrs $133.14 24 $3,195 hrs $128.07 24 $3,074 hrs $151.36 24 $3,633 hrs $20.53 168 $3,450 sf $1.25 12,100 $15,125 $42,801 Septic Tanks and Drain Fields Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears Equipment Maintenance (Butler) Total Septic Tanks and Drain Fields hrs $18.94 16 $303 hrs $16.53 0 $0 hrs $12.51 16 $200 hrs $1.35 32 $43 hrs $93.53 16 $1,496 hrs $16.67 16 $267 hrs $133.14 8 $1,065 hrs $128.07 8 $1,025 hrs $151.36 0 $0 hrs $20.53 32 $657 $5,056 Misc. Tankage & Spare Parts Removal Resource Description Units Cost/Unit Task Units Task Cost hrs $18.94 36 $682 hrs $16.53 48 $793 hrs $12.51 24 $300 hrs $1.35 72 $97 hrs $93.53 48 $4,489 hrs $16.67 48 $800 hrs $133.14 12 $1,598 hrs $128.07 12 $1,537 hrs $151.36 12 $1,816 hrs $20.53 84 $1,725 Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears Equipment Maintenance (Butler) Total Misc. Tankage & Spare Parts Removal $13,838 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING Alternate Feed Circuit and Reagent Storage Building Resource Description Equipment Operators Mechanics Laborers Small Tools Cat 770 Haul Truck Truck Drivers Cat 988 Loader Cat 365 Excavator PC 300 w/metal Shears Equipment Maintenance (Butler) Concrete Removal Units Cost/Unit Task Units Task Cost hrs $18.94 118 $2,235 hrs $16.53 50 $826 hrs $12.51 50 $625 hrs $1.35 96 $130 hrs $93.53 48 $4,489 hrs $16.67 50 $834 hrs $133.14 34 $4,527 hrs $128.07 32 $4,098 hrs $151.36 52 $7,871 hrs $51.46 166 $8,542 sf $3.30 3,500 $11,550 Total Alternate Feed Circuit and Reagent Storage Building $45,727 Mill Yard Decontamination Resource Description Units Cost/Unit Task Units Task Cost hrs $18.94 582 $11,022 hrs $205.10 257 $52,712 hrs $133.14 65 $8,654 hrs $94.96 65 $6,173 hrs $80.38 65 $5,225 hrs $107.49 65 $6,987 hrs $70.59 65 $4,588 hrs $20.53 582 $11,950 Equipment Operators Cat 637 Scraper Cat 988 Loader Cat D8N Dozer With Ripper Cat D7 Dozer Cat 651 Watenwagon Cat 14G Motorgrader Equipment Maintenance (Butler) Total Mill Yard Decontamination $107,311 Ore Storage Pad Decontamination Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Cat 637 Scraper Cat 988 Loader Cat D8N Dozer With Ripper Cat D7 Dozer Cat 651 Waterwagon Cat 14G Motorgrader Equipment Maintenance (Butler) hrs $18.94 429 $8,125 hrs $205.10 189 $38,765 hrs $133.14 48 $6,391 hrs $94.96 48 $4,558 hrs $80.38 48 $3,858 hrs $107.49 48 $5,159 hrs $70.59 48 $3,388 hrs $20.53 429 $8,809 Total Ore Storage Pad Decontamination $79,053 Equipment Storage Area Cleanup Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Cat 637 Scraper Cat 988 Loader Cat D8N Dozer With Ripper Cat D7 Dozer Cat 651 Watenwagon Cat 14G Motorgrader Equipment Maintenance (Butler) hrs $18.94 153 $2,898 hrs $205.10 68 $13,947 hrs $133.14 17 $2,263 hrs $94.96 17 $1,614 hrs $80.38 17 $1,366 hrs $107.49 17 $1,827 hrs $70.59 17 $1,200 hrs $20.53 153 $3,142 Total Equipment Storage Area Cleanup $28,258 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING Revegetate Mill Yard & Ore Pad Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Cat 637 Scraper Cat 988 Loader Cat D8N Dozer With Ripper Cat D7 Dozer Cat 651 Watenwagon Cat 14G Motorgrader Seed Mix Equipment Maintenance (Butler) hrs $18.94 231 $4,375 hrs $205.10 132 $27,074 hrs $133.14 0 $0 hrs $94.96 33 $3,134 hrs $80.38 33 $2,653 hrs $107.49 0 $0 hrs $70.59 33 $2,329 Acre $322.50 50 $16,125 hrs $20.53 231 $4,743 Total Revegetate Mill Yard & Ore Pad $60,433 Total Demolition and Decontamination I $1,325,894| CLEANUP OF WINDBLOWN CONTAMINATION Scoping Survey Resource Description Units Cost/Unit Task Units Task Cost Soil Samples each $50.00 100 $5,000 Sun/ey Crew hrs $15.91 752 $11,961 Sample Crew hrs $15.91 1,312 $20,868 Total Scoping Survey $37,829 Characterization Survey Resource Description Units Cost/Unit Task Units Task Cost Soil Samples each $50.00 472 $23,600 Sample Crew hrs $15.91 1,136 $18,069 Total Characterization Survey $41,669 Final Status Survey Resource Description Units Cost/Unit Task Units Task Cost Soil Samples each $50.00 300 $15,000 Sample Crew hrs $15.91 3,552 $56,497 Total Final Status Survey $71,497 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING Windblown Cleanup Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $18.94 1,190 $22,537 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $205.10 680 $139,471 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $94.96 170 $16,144 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $80.38 170 $13,665 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $70.59 170 $12,000 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) each $50.00 500 $25,000 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $15.91 163 $2,593 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $15.91 83 $1,320 Equipment Operators Cat 637 Scraper Cat D8N Dozer With Ripper Cat D7 Dozer Cat 14H Motorgrader Soil Samples Survey Crew Sample Crew Equipment Maintenance (Butler) hrs $20.53 1,190 $24,434 Total Windblown Cleanup $257,164 Quality Control Resource Description Units Cost/Unit Task Units Task Cost Quality Control Contractor hrs $62.00 2,080 $128,960 Total Quality Control Total Cleanup Windblown Contamination $128,960 I $537,1191 Conventional Ore Disposal Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators hrs $18.94 1,070 $20,272 Cat 770 Haul Truck (3) hrs $93.53 612 $57,264 Cat 988 Loader hrs $133.14 204 $27,171 Cat 651 Watenwagon hrs $107.49 204 $21,936 Cat 14G Motorgrader hrs $70.59 50 $3,529 Equipment Maintenance (Butler) hrs $20.53 1,070 $21,978 Total Conventional Ore Disposal Total Quantity I $152,151] 120,000 Cubic Yards* 196 Cubic Yards per Truck per hour 612 Truck Hours * 162,000 tons maximum projected for December 2010 Alternate Feed Disposal Cabot and FMRI Material Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators hrs $18.94 158 $2,984 Cat 770 Haul Truck (3) hrs $93.53 65 $6,035 Cat 988 Loader hrs $133.14 22 $2,863 Cat 651 Watenwagon hrs $107.49 22 $2,312 Cat 14G Motorgrader hrs $70.59 50 $3,529 Equipment Maintenance (Butler) hrs $20.53 158 $3,235 Total Cabot & FMRI Material Total Quantity 12,646 Cubic Yards* (as of 01/31/2010) 196 Cubic Yards per Truck per hour 65 Truck Hours $20,957 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill MILL DECOMMISSIONING Includes Linde, Cabot and FMRI Cameco Barrels and Honeywell Barrels Resource Description Units Cost/Unit Task Units Task Cost hrs $16.67 296 $4,929 hrs $55.00 296 $16,260 hrs $18.00 591 $10,643 hrs $20.53 296 $6,070 $37,902 29,563 Barrels (as of 01/31/2010) 40 Barrels per load 0.4 Hours per load 296 Truck Hours Tons lbs. per barrel No. Drums CaF2 1,083 727 2,978 Calcined 2,547 320 15,919 Regen 329 406 1.621 KF 1,305 309 8,447 UF4 164 547 599 5,428 29,563 Equipment Operators Flat Bed Trailer and Tractor* Fork Lift (2) Equipment Maintenance (Butler) Total Cameco and honeywell Barrels * includes operator Sub-Total Alternate Feed Disposal TOTAL MILL DECOMMISSIONING I $2,074,022] 8/19/2010 - 2:24 PM-WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill Miscellaneous MISCELLANEOUS ITEMS MISCELLANEOUS ITEMS Equipment Mobilization Resource Description Units Cost/Unit Task Units Task Cost Butler Machinery Mobilization LS $351,322 1 $351,322 Other Equipment Mobilization LS $4,550 1 $4,550 Cranes LS $2,700 2 $5,400 Total Equipment Mobilization $361,272 Office Facilities Resource Description Units Cost/Unit Task Units Task Cost Install New Po«/eriine LS $15,000 1 $15,000 Utilities for Offices months $1,000 36 $36,000 Temporary Office Trailer months $1,500 3 $4,500 Temporary Office Trailer, mob, demob & setup LS $3,000 1 $3,000 Total Office Facilities $58,500 Decontamination Pad Resource Description Units Cost/Unit Task Units Task (Dost Laborers hrs $13 8,320 $104,046 Construct Wheel Wash Faciiity LS $180,000 1 $180,000 Total Decontamination Facilities Facilities constructed in 2000 & 2008 ($180,000) $104,046 Plug and Abandon WW2 Resource Description Units Cost/Unit Task Units Task Cost Laborers hrs $0 8,320 $0 Contract Services LS $20,000 1 $20,000 Total Plug and Abandon WW2 $20,000 Slimes Drain Evaporation Pond Resource Description Units Cost/Unit Task Units Task Cost Equipment Operators hrs $18.94 200 $3,788 60 mil HOPE Liner sq.ft. $0.35 960,000 $336,000 Cat 637 Scraper hrs $205.10 100 $20,510 Cat 825 Compactor hrs $93.85 25 $2,346 Cat D7 Dozer hrs $80.38 25 $2,010 Cat 651 Watewagon hrs $107.49 25 $2,687 Cat 14G Motorgrader hrs $70.59 25 $1,765 Equipment Maintenance (Butler) hrs $20.53 200 $4,107 Total Slimes Drain Evaporation Pond $373,213 MANAGEMENT/SUPPORT Resource Description Units Cost/Unit Task Units Task Cost Manager/Engineer hrs $58.19 6,240 $363,114 Radiation Safety Officer hrs $45.47 6,240 $283,713 Secretary hrs $18.39 6,240 $114,744 Clerk hrs $15.13 4,866 $73,621 Environmental Technician ( Part time, 4.5 years) hrs $25.60 4,866 $124,590 Maintenance Foreman hrs $33.36 6,240 $208,185 Chemist hrs $26.77 2,080 $55,678 Security hrs $9.85 18,720 $184,462 Safety Engineer hrs $25.60 4,160 $106,513 Misc. Materials & Supplies hrs $36.45 6,240 $227,448 Health Physics Costs hrs $64.81 2,080 $134,800 Environmental Monitoring Costs, Laboratory years $71,620.00 7.0 $501,340 Totai Management/Support $2,378,209 TOTAL MISCELLANEOUS ITEMS $3,295,2401 8/19/2010 - 2 24 PM - WMM Rec Plan Est August 2010 Rev 4.2 Denison Mines (USA) Corp. White Mesa Mill General Liability Insurance & Auto Insurance General Liability and Auto Insurance Project Life 7 years GL Insurance per full year $ 35,000 Auto $ 1,200 $ 12,000 Vehicles Vehicle Ins. GL Insurance Year 1 5 $ 6,000 $ 20,000 Year 2 10 $ 12,000 $ 35,000 Years 10 $ 12,000 $ 35,000 Year 4 10 $ 12,000 $ 35,000 Years 10 $ 12,000 $ 35,000 Years 10 $ 12,000 $ 35,000 Year/ 3 $ 3,600 $ 20,000 $ 69,600 $ 215,000 Project Cost $ 284,600 8/19/2010 WMM Rec Plan Est August 2010 Rev 4.2 Harold Roberts From: Sent: To: Subject: Jim Anderson Thursday, July 29, 2010 7:16 AM Harold Roberts FW: Denison Mines Harold, is Tom's assumption correct? Jim Anderson Executive Vice President & Cliief Financial Officer t; 416-979-1991 x372 | f: 416-979-5893 595 Bay Street, Suite 402, Toronto, ON M5G 2C2 DENISON MINES CORP www.denisonmines.com This e-mail is intended for exclusive use the person{s) mentioned as the recipient(s). This message and any attached files with it are confidential and may contain privileged or proprietary information. If you are not the intended recipient(s) please delete this message and notify the sender. You may not use, distribute print or copy this message if you are not the intended recipient(s). From: Thomas.McBeath@aon.ca [mailto:Thomas.McBeath@aon.ca] Sent: July 29, 2010 8:07 AM To: Jim Anderson Subject: Re: Denison Mines Jim, Would it be correct to assume that the $16mil reclaimation project would be done over several years? The letter hints at this with 5 years of monitoring, and 6.5yrs of pumping. I have used that assumption and recommend the following premiums: a) General Liability: $35,000 per year b) Automobile: $1,200 per vehicle per year. Thus, $12,000 for 10 vehicles. Trust this meets your needs. Feel free to call if questions. Sincerely, Tom Thomas McBeath, P.Eng. | Aon Reed Stenhouse Inc. Vice President | Risk Management Practice 20 Bay Street, Toronto, ON M5J 2N9 Tel: 416.868.2449 | Fax: 416.868.5580 thomas.mcbeath(a>aon.ca www.aon.ca Jim Anderson <JAnderson(a)denisonmines.com> Jul/23/2010 02:29 PM AST To "Thomas.McBeath@aon.ca" <Thomas.McBeath@aon.ca> cc Subject Denison Mines Tom, we are re-estimating our reclamation liability for the White Mesa mill in the US. The attached letter outlines some additional information required by the State. On page two in the paragraph marked they require some specific estimates on insurance. Once you have had a chance to review, could you give me a call to discuss how best to address this? Jim Anderson Executive Vice President & Chief Financial Officer t: 416-979-1991 x372 | f: 416-979-5893 595 Bay Street, Suite 402, Toronto, ON M5G 2C2 DENISON MINES CORP http://www.denisonmines.com/ This e-mail is intended for exclusive use the person(s) mentioned as the recipient(s). This message and any attached files with it are confidential and may contain privileged or proprietary information. If you are not the intended recipient(s) please delete this message and notify the sender. You may not use, distribute print or copy this message if you are not the intended recipient(s). [attachment "Scanned001.pdf" deleted by Thomas McBeath/ARS/CA/AON] This communication (and any attachments) is directed in confidence to the addressee(s) listed above, and may not otherwise be distributed, copied or used. The contents of this communication may also be subject to privilege, and all rights to that privilege are expressly claimed and not waived. 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