07:41 AM EST, 11/27/2024 (MT Newswires) -- Denison Mines ( DNN ) said on Wednesday that it signed an agreement with Cosa Resources ( COSAF ) to form three uranium exploration joint ventures in the eastern portion of the Athabasca Basin region in northern Saskatchewan.

Denison's share price was up 0.4% to US$2.28 at last look in NYSE American pre-market trading following the news.

Under the terms, Cosa will acquire a 70% interest in Denison's 100%-owned Murphy Lake North, Darby and Packrat properties in exchange for 14.2 million Cosa shares, $2.25 million in deferred equity consideration, and a commitment to spend $6.5 million in exploration expenditures at Murphy Lake North and Darby.

"Denison is pleased to collaborate with Cosa in a way that is mutually beneficial and enhances our exposure to the potential discovery of a meaningful uranium deposit on the properties and through Cosa's existing uranium exploration portfolio," said David Cates, Denison's president and CEO.

Denison said it will maintain a minimum 30% direct interest in the properties and will become Cosa's largest shareholder with a 19.95% stake.

Denison also secured a 2% net smelter royalty (NSR) on Darby and Packrat, and a 0.5% NSR on Murphy Lake North.

Cosa can reduce the NSR on each of Darby and Packrat to 1% for $2 million per project.

The Darby project is also subject to a buydown right that allows Denison to reclaim up to a 60% interest in the property until such time as Denison's interest in the project falls below 10%, or commercial production of 500,000 pounds of uranium is achieved from the applicable Darby claim.

"With Denison focused on executing on our core mining and development-stage projects, we believe Cosa is an excellent partner to advance exploration of the properties," Cates said. "The entire Cosa senior management team has worked with Denison previously, and have strong technical capabilities, plus a unique familiarity with the Properties and nearby discoveries."