Event: Denison Mines has announced that the McClean Lake Mill is to be put on care and maintenance in mid-2010 as developing new feeder deposits is uneconomical at current uranium prices. BMO recently published a report forecasting that a greater amount of production is coming onstream at lower marginal costs, resulting in the uranium market entering a period of oversupply. Consequently, a low uranium price will result in a number of higher-cost mines halting production and higher-cost development projects being put on hold.Impact: Slightly Negative. BMO already expected that the McClean Lake Mill would close, as it is marginal at current prices. Attributable 2010 production from McClean Lake is now expected to be 419klb U3O8 versus 745klb previously. During the first nine months of 2009, BMO estimates Denison to have developed a stockpile of ~ 800klb U3O8, which can be liquidated during 2010. Forecasts: Production from McClean Lake is high cost and the impact to earnings is limited. BMO forecasts the 2010 loss to widen by US$0.01/share to US$0.03/share.Valuation: BMO estimates Denison to have a 10% nominal NPV of C$0.69/share.Recommendation: BMO does not forecast any appreciable earnings from Denison unless uranium prices improve substantially. However, the exposure to potential high-grade exploration success at the Wheeler River project sees BMO maintaining its Market Perform (Speculative) rating and C$1.35 target.