White Canyon Uranium caps off most successful quarter, ASX uranium producer

Friday, January 29, 2010

White Canyon Uranium (ASX: WCU) capped off its most successful quarter in its history - joining the select ranks of uranium producers listed on the Australian Stock Exchange. The list includes: Energy Resources of Australia (ASX: ERA), Paladin Resources (ASX: PDN) and now White Canyon Uranium.

Junior WCU does not have the resource base of its brethren, it does have a Toll Milling Agreement locked-in with Denison Mines (TSX:DML, NYSE AMEX:DNN).

Denison will process all material produced from White Canyon’s owned and operated Daneros project in Utah. The agreement has a three year term with an optional two year extension and commences in January 2010.

Initial production is to be sourced from the Daneros mine, which is located approximately 100kms from the White Mesa complex. Additional production is expected to be sourced from the Company’s Lark Royal, Geitus, Blue Jay, Marcy Look and Yellow Cat projects, which are also in close proximity to the White Mesa Mill.

White Canyon will transport material produced to Denison’s White Mesa Mill for processing of up to 55,000 tons per annum. The Company will pay to Denison the direct costs to mill its material produced, a capital charge plus a toll milling fee per ton of ore, which will be partly linked to the long‐term uranium price.

Processing will be scheduled by Denison and can commence after the production and stockpiling of 36,000 tons of White Canyon material. First processing of Daneros ore is expected in H1 2011 allowing White Canyon to meet expected delivery dates in H2 2011.

It is likely WCU will seek a contract buyer, rather than sell its uranium into the spot market. White Canyon could be looking at a sale contract to deliver 200,000 pounds of uranium ore in July 2011, and potentially another 100,000lbs by December 2011.

WCU announced an underwriting agreement with Cunningham Peterson Sharbanee Securities Pty Ltd for the outstanding listed options (ASX: WCUO) that are presently on issue and due to expire on January 29, 2010.

WCU will kick exploration and mining feasibility studies into high gear with receipt of the funds. White Canyon said it expects production rates to increase with additional mines coming into production as a result of this work.

The process of applying to list on the TSX Venture Exchange is progressing. This is a compliance listing only with no fundraising associated with the process.

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