---

Exhibit 99.3











DENISON MINES CORP.



Financial Statements for the years ended December 31,
2014 and 2013

---

Responsibility for Financial Statements

The Companys management is responsible for the integrity and
fairness of presentation of these consolidated financial statements. The
consolidated financial statements have been prepared by management, in
accordance with International Financial Reporting Standards as issued by the
International Accounting Standards Board, for review by the Audit Committee and
approval by the Board of Directors.

The preparation of financial statements requires the selection
of appropriate accounting policies in accordance with International Financial
Reporting Standards and the use of estimates and judgements by management to
present fairly and consistently the consolidated financial position of the
Company. Estimates are necessary when transactions affecting the current period
cannot be finalized with certainty until future information becomes available.
In making certain material estimates, the Companys management has relied on the
judgement of independent specialists.

The Companys management has developed and maintains a system
of internal accounting controls to ensure, on a reasonable and cost-effective
basis, that the financial information is timely reported and is accurate and
reliable in all material respects and that the Companys assets are
appropriately accounted for and adequately safeguarded.

The consolidated financial statements have been audited by
PricewaterhouseCoopers LLP, our independent auditor. Its report outlines the
scope of its examination and expresses its opinions on the consolidated
financial statements and internal control over financial reporting.

|Original signed by Ron F. Hochstein | Original signed by David D. Cates  
|------------------------------------- | -------------------------------------
|                                      |                                      
|Ron F. Hochstein                      | David D. Cates                       
|Chief Executive Officer               | President and Chief Financial Officer
|March 5, 2015                         |                                      

Managements Report on Internal Control over
Financial Reporting

The Companys management is responsible for establishing and
maintaining an adequate system of internal control over financial reporting.
Management conducted an evaluation of the effectiveness of internal control over
financial reporting based on the Internal Control  Integrated Framework,
2013issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based on this evaluation, management concluded that the Companys
internal control over financial reporting was effective as of December 31,
2014.

The effectiveness of the Companys internal control over
financial reporting as at December 31, 2014 has been audited by
PricewaterhouseCoopers LLP, our independent auditor, as stated in its report
which appears herein.

Changes to Internal Control over Financial
Reporting

There has not been any change in the Companys internal control
over financial reporting that occurred during 2014 that has materially affected,
or is reasonably likely to materially affect, the Companys internal control
over financial reporting.

ii

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March 5, 2015





Independent Auditors Report

To the Shareholders ofDenison Mines Corp.

We have completed integrated audits of Denison Mines Corp. and
its subsidiaries current year and prior year consolidated financial statements
and their internal control over financial reporting as at December 31, 2014. Our
opinions, based on our audits are presented below.

Report on the consolidated financial statementsWe
have audited the accompanying consolidated financial statements of Denison Mines
Corp. and its subsidiaries, which comprise the consolidated statements of
financial position as at December 31, 2014 and 2013 and the consolidated
statements of income (loss) and comprehensive income (loss), changes in equity
and cash flow for the years then ended, and the related notes, which comprise a
summary of significant accounting policies and other explanatory information.

Managements responsibility for the consolidated financial
statementsManagement is responsible for the preparation and fair
presentation of these consolidated financial statements in accordance with
International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB) and for such internal control as
management determines is necessary to enable the preparation of consolidated
financial statements that are free from material misstatement, whether due to
fraud or error.

Auditors responsibilityOur responsibility is to
express an opinion on these consolidated financial statements based on our
audits. We conducted our audits in accordance with Canadian generally accepted
auditing standards and the standards of the Public Company Accounting Oversight
Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the consolidated financial
statements are free from material misstatement. Canadian generally accepted
auditing standards also require that we comply with ethical requirements.

An audit involves performing procedures to obtain audit
evidence, on a test basis, about the amounts and disclosures in the consolidated
financial statements. The procedures selected depend on the auditors judgment,
including the assessment of the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers internal control relevant to the
Companys preparation and fair presentation of the consolidated financial
statements in order to design audit procedures that are appropriate in the
circumstances. An audit also includes evaluating the appropriateness of
accounting principles and policies used and the reasonableness of accounting
estimates made by management, as well as evaluating the overall presentation of
the consolidated financial statements.

We believe that the audit evidence we have obtained in our
audits is sufficient and appropriate to provide a basis for our audit opinion on
the consolidated financial statements.

OpinionIn our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of
Denison Mines Corp. and its subsidiaries as at December 31, 2014 and 2013 and
their financial performance and their cash flows for the years then ended in
accordance with IFRS as issued by the IASB.

---

Report on internal control over financial reportingWe have also audited Denison Mines Corp. and its subsidiaries internal
control over financial reporting as at December 31, 2014, based on criteria
established in Internal Control - Integrated Framework (2013), issued by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Managements responsibility for internal control over
financial reportingManagement is responsible for maintaining effective
internal control over financial reporting and for its assessment of the
effectiveness of internal control over financial reporting included in the
accompanying Managements Report on Internal control over Financial Reporting.

Auditors responsibilityOur responsibility is to
express an opinion on the Companys internal control over financial reporting
based on our audit. We conducted our audit of internal control over financial
reporting in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material
respects.

An audit of internal control over financial reporting includes
obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, testing and evaluating the
design and operating effectiveness of internal control, based on the assessed
risk, and performing such other procedures as we consider necessary in the
circumstances.

We believe that our audit provides a reasonable basis for our
audit opinion on the Companys internal control over financial reporting.

Definition of internal control over financial reportingA Companys internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A Companys internal
control over financial reporting includes those policies and procedures that:
(i) pertain to the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets of the
Company; (ii) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of
the Company are being made only in accordance with authorizations of management
and directors of the Company; and (iii) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition
of the Companys assets that could have a material effect on the financial
statements.

Inherent limitationsBecause of its inherent
limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of
changes in conditions or that the degree of compliance with the policies or
procedures may deteriorate.

OpinionIn our opinion, Denison Mines Corp. and its
subsidiaries maintained, in all material respects, effective internal control
over financial reporting as at December 31, 2014, based on criteria established
in Internal Control - Integrated Framework (2013) issued by COSO.

(Signed) PricewaterhouseCoopers LLP

Chartered Professional Accountants, Licensed Public
Accountants Toronto, Ontario, Canada

---

|DENISON MINES CORP.                                                    
|-----------------------------------------------------------------------
|Consolidated Statements of Financial Position                          
|(Expressed in
      thousands of U.S. dollars except for share amounts)

|                                                              |   | At December 31 |   |   | At December 31 |  
|------------------------------------------------------------- | - | -------------- | - | - | -------------- | -
|                                                              |   | 2014           |   |   | 2013           |  
|ASSETS                                                        |   |                |   |   |                |  
|Current                                                       |   |                |   |   |                |  
|Cash and cash equivalents (note 6)                            | $ | 18,640         |   | $ | 21,786         |  
|Investments (note 9)                                          |   | 4,381          |   |   | 10,040         |  
|Trade and other receivables (note 7)                          |   | 9,411          |   |   | 4,148          |  
|Inventories (note 8)                                          |   | 2,240          |   |   | 2,123          |  
|Prepaid expenses
      and other                              |   | 850            |   |   | 749            |  
|                                                              |   | 35,522         |   |   | 38,846         |  
|Non-Current                                                   |   |                |   |   |                |  
|Inventories  ore in stockpiles (note 8)                      |   | 1,760          |   |   | 1,661          |  
|Investments (note 9)                                          |   | 954            |   |   | 5,901          |  
|Restricted cash and investments (note 10)                     |   | 2,068          |   |   | 2,299          |  
|Property, plant and equipment (note 11)                       |   | 270,388        |   |   | 281,010        |  
|Intangibles (note 12)                                         |   | 638            |   |   | 1,252          |  
|Total assets                                                  | $ | 311,330        |   | $ | 330,969        |  
|                                                              |   |                |   |   |                |  
|LIABILITIES                                                   |   |                |   |   |                |  
|Current                                                       |   |                |   |   |                |  
|Accounts payable and accrued liabilities                      | $ | 10,050         |   | $ | 7,992          |  
|Current portion of long-term liabilities:                     |   |                |   |   |                |  
|Post-employment benefits
      (note 13)                      |   | 259            |   |   | 376            |  
|Reclamation obligations (note 14)                             |   | 706            |   |   | 699            |  
|Debt obligations (note
      15)                              |   | 30             |   |   | 55             |  
|Other liabilities (note
      16)                             |   | 1,935          |   |   | 333            |  
|                                                              |   | 12,980         |   |   | 9,455          |  
|Non-Current                                                   |   |                |   |   |                |  
|Post-employment benefits (note 13)                            |   | 2,662          |   |   | 2,945          |  
|Reclamation obligations (note 14)                             |   | 16,953         |   |   | 11,509         |  
|Debt obligations (note 15)                                    |   | 9              |   |   | 42             |  
|Other liabilities (note 16)                                   |   | 841            |   |   | 940            |  
|Deferred income
      tax liability (note 17)                 |   | 21,826         |   |   | 25,847         |  
|Total liabilities                                             |   | 55,271         |   |   | 50,738         |  
|                                                              |   |                |   |   |                |  
|EQUITY                                                        |   |                |   |   |                |  
|Share capital (note 18)                                       |   | 1,120,758      |   |   | 1,092,144      |  
|Share purchase warrants (note 19)                             |   | 376            |   |   | 616            |  
|Contributed surplus (note 20)                                 |   | 53,321         |   |   | 52,943         |  
|Deficit                                                       |   | (892,537       | ) |   | (860,834       | )
|Accumulated other
      comprehensive income (loss) (note 21) |   | (25,859        | ) |   | (7,729         | )
|Total equity                                                  |   | 256,059        |   |   | 277,140        |  
|Non-controlling
      interest (note 5)                       |   | -              |   |   | 3,091          |  
|Total liabilities and equity                                  | $ | 311,330        |   | $ | 330,969        |  
|                                                              |   |                |   |   |                |  
|Issued and outstanding common shares (note 18)                |   | 505,868,894    |   |   | 482,003,444    |  
|Commitments and contingencies (note 26)                       |   |                |   |   |                |  
|Subsequent events (note 28)                                   |   |                |   |   |                |  

The accompanying notes are an integral part of the consolidated
financial statements

On behalf of the Board of Directors:

|(Signed) Ron F. Hochstein | (Signed) Catherine J.G. Stefan
|--------------------------- | --------------------------------
|Director                    | Director                        

- 1 -

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|DENISON MINES CORP.                                                                  
|-------------------------------------------------------------------------------------
|Consolidated Statements of Income (Loss) and Comprehensive
      Income (Loss)       
|(Expressed in
      thousands of U.S. dollars except for share and per share amounts)

|                                                                    |   | Year
      Ended |  
|------------------------------------------------------------------- | - | ---------------- | -
|                                                                    |   | December 31      |  
|                                                                    |   | 2014             |  
|                                                                    |   |                  |  
|REVENUES(note 23)                                                   | $ | 9,619            |  
|                                                                    |   |                  |  
|EXPENSES                                                            |   |                  |  
|Operating expenses (note 22, 23)                                    |   | (11,651          | )
|Mineral property exploration (note 23)                              |   | (14,795          | )
|General and administrative (note 23)                                |   | (7,590           | )
|Impairment of mineral properties (note 11)                          |   | (1,745           | )
|Other income
      (expense) (note 22)                              |   | (7,558           | )
|                                                                    |   | (43,339          | )
|Income (loss) before finance charges                                |   | (33,720          | )
|                                                                    |   |                  |  
|Finance income
      (expense) (note 22)                            |   | (282             | )
|Income (loss) before taxes                                          |   | (34,002          | )
|Income tax recovery (expense) (note 17):                            |   |                  |  
|Current                                                             |   | (5               | )
|Deferred                                                            |   | 2,304            |  
|Net income (loss) for the period                                    | $ | (31,703          | )
|                                                                    |   |                  |  
|Items that may be reclassified to income
      (loss):              |   |                  |  
|Unrealized gain (loss) on investments-net of
      tax              |   | 7                |  
|Foreign currency translation change                                 |   | (18,137          | )
|Comprehensive
      income (loss) for the period                    | $ | (49,833          | )
|                                                                    |   |                  |  
|Net income (loss) per share:                                        |   |                  |  
|Basic and diluted                                                   | $ | (0.06            | )
|                                                                    |   |                  |  
|Weighted-average number of shares
      outstanding (in thousands): |   |                  |  
|Basic
      and diluted                                             |   | 494,510          |  

The accompanying notes are an integral part of the consolidated
financial statements

- 2 -

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|DENISON MINES CORP.                           
|----------------------------------------------
|Consolidated Statements of Changes in Equity  
|(Expressed in
      thousands of U.S. dollars)

|                                                                                   |   | Year
      Ended |  
|---------------------------------------------------------------------------------- | - | ---------------- | -
|                                                                                   |   | December 31      |  
|                                                                                   |   | 2014             |  
|                                                                                   |   |                  |  
|Share capital                                                                      |   |                  |  
|Balancebeginning of period                                                        | $ | 1,092,144        |  
|Share issues-net of issue costs                                                    |   | 12,845           |  
|Flow-through share premium                                                         |   | (2,030           | )
|Shares issued on acquisition of JNR Resources (note 5)                             |   | -                |  
|Shares issued on acquisition of Fission
      Energy Corp (note 5)                 |   | -                |  
|Shares issued on acquisition of Rockgate Capital Corp (note
      5)               |   | 3,034            |  
|Shares issued on acquisition of
      International Enexco Limited (note 5)        |   | 11,979           |  
|Shares issued to settle payable and accrued liability
      obligations (note 18)  |   | 610              |  
|Share options exercised-cash                                                       |   | 946              |  
|Share options exercised-non cash                                                   |   | 525              |  
|Share purchase warrants exercised-cash                                             |   | 405              |  
|Share purchase
      warrants exercisednon-cash                                   |   | 300              |  
|Balanceend of period                                                              |   | 1,120,758        |  
|                                                                                   |   |                  |  
|Share purchase warrants                                                            |   |                  |  
|Balancebeginning of period                                                        |   | 616              |  
|Warrants issued on acquisition of JNR
      Resources (note 5)                     |   | -                |  
|Warrants assumed on acquisition of Fission Energy Corp
      (note 5)              |   | -                |  
|Warrants issued on acquisition of
      International Enexco Limited (note 5)      |   | 61               |  
|Warrants exercised                                                                 |   | (300             | )
|Warrants expired                                                                   |   | (1               | )
|Balanceend of
      period                                                        |   | 376              |  
|                                                                                   |   |                  |  
|Contributed surplus                                                                |   |                  |  
|Balancebeginning of period                                                        |   | 52,943           |  
|Stock-based compensation expense                                                   |   | 800              |  
|Share options issued on acquisition of JNR
      Resources (note 5)                |   | -                |  
|Share options issued on acquisition of Fission Energy Corp
      (note 5)          |   | -                |  
|Share options issued on acquisition of
      International Enexco Limited (note 5) |   | 102              |  
|Share options exercised-non-cash                                                   |   | (525             | )
|Warrants expired                                                                   |   | 1                |  
|Warrants
      expiredtax effect                                                  |   | -                |  
|Balanceend of period                                                              |   | 53,321           |  
|                                                                                   |   |                  |  
|Deficit                                                                            |   |                  |  
|Balancebeginning of period                                                        |   | (860,834         | )
|Net loss                                                                           |   | (31,703          | )
|Balance-end of
      period                                                        |   | (892,537         | )
|                                                                                   |   |                  |  
|Accumulated other comprehensive income                                             |   |                  |  
|Balancebeginning of period                                                        |   | (7,729           | )
|Unrealized gain (loss) on investments                                              |   | 7                |  
|Foreign currency translation                                                       |   | (18,137          | )
|Foreign currency
      translation realized in net income                          |   | -                |  
|Balanceend of period                                                              |   | (25,859          | )
|                                                                                   |   |                  |  
|Total Equity                                                                       |   |                  |  
|Balancebeginning
      of period                                                  | $ | 277,140          |  
|Balanceend of period                                                              | $ | 256,059          |  

The accompanying notes are an integral part of the consolidated
financial statements

- 3 -

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|DENISON MINES CORP.                           
|----------------------------------------------
|Consolidated Statements of Cash Flow          
|(Expressed in
      thousands of U.S. dollars)

|                                                                        |   | Year
      Ended |  
|----------------------------------------------------------------------- | - | ---------------- | -
|                                                                        |   | December 31      |  
|CASH PROVIDED
      BY (USED IN):                                       |   | 2014             |  
|                                                                        |   |                  |  
|OPERATING ACTIVITIES                                                    |   |                  |  
|Net income (loss) for the period                                        | $ | (31,703          | )
|Items not affecting cash:                                               |   |                  |  
|Depletion, depreciation, amortization and accretion                     |   | 2,095            |  
|Impairment  mineral properties (note
      5)                          |   | 1,745            |  
|Impairment  investments                                                |   | 22               |  
|Stock-based compensation                                                |   | 800              |  
|Losses (gains) on reclamation obligation revisions                      |   | 2,086            |  
|Losses (gains) on asset disposals                                       |   | (449             | )
|Losses (gains) on investments and restricted
      investments          |   | 59               |  
|Deferred income tax expense
      (recovery)                            |   | (2,304           | )
|Foreign exchange                                                        |   | 7,983            |  
|Change in non-cash working capital items (note 22)                      |   | (3,834           | )
|Net cash provided
      by (used in) operating activities               |   | (23,500          | )
|                                                                        |   |                  |  
|INVESTING ACTIVITIES                                                    |   |                  |  
|Acquisition of assets, net of cash and cash
      equivalents acquired: |   |                  |  
|JNR Resources (note 5)                                                  |   | -                |  
|Fission Energy Corp (note 5)                                            |   | -                |  
|Rockgate Capital Corp (note 5)                                          |   | (57              | )
|International Enexco Limited
      (note 5)                             |   | (141             | )
|Decrease (increase) in notes receivable                                 |   | -                |  
|Sale of investments                                                     |   | 9,529            |  
|Purchase of investments                                                 |   | (569             | )
|Expenditures on property, plant and
      equipment                     |   | (859             | )
|Proceeds on sale of property, plant and equipment                       |   | 265              |  
|Decrease (increase) in restricted cash and investments                  |   | 44               |  
|Net cash provided
      by (used in) investing activities               |   | 8,212            |  
|                                                                        |   |                  |  
|FINANCING ACTIVITIES                                                    |   |                  |  
|Increase (decrease) in debt obligations                                 |   | (53              | )
|Issuance of common shares for:                                          |   |                  |  
|New share issues-net of issue costs
      (note 18)                     |   | 12,845           |  
|Share options exercised (note 18)                                       |   | 946              |  
|Share purchase warrants exercised (note 18)                             |   | 405              |  
|Net cash provided
      by (used in) financing activities               |   | 14,143           |  
|                                                                        |   |                  |  
|Increase (decrease) in cash and cash equivalents                        |   | (1,145           | )
|Foreign exchange effect on cash and cash
      equivalents              |   | (2,001           | )
|Cash and cash
      equivalents, beginning of period                    |   | 21,786           |  
|Cash and cash equivalents, end of period                                | $ | 18,640           |  
|                                                                        |   |                  |  
|Supplemental cash flow disclosure:                                      |   |                  |  
|Interest paid                                                           | $ | 2                |  
|Income taxes paid (recovered)                                           |   | -                |  

The accompanying notes are an integral part of the consolidated
financial statements

- 4 -

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|DENISON MINES CORP.                                                                                
|---------------------------------------------------------------------------------------------------
|Notes to the consolidated financial statements for the
      years ended December 31, 2014 and 2013
|(Expressed in U.S. dollars except for shares and per share
      amounts)                          
|                                                                                                   

|1. | NATURE OF OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Denison Mines Corp. and its subsidiary companies and
      joint arrangements (collectively, the Company) are engaged in uranium
      mining and related activities, including acquisition, exploration and
      development of uranium properties, extraction, processing and selling of
      uranium.                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The Company has a 22.5% interest in the McClean Lake
      Joint Venture (MLJV) (which includes the McClean Lake mill) and a 25.17%
      interest in the Midwest Joint Venture (MWJV), both of which are located
      in the Athabasca Basin of Saskatchewan, Canada. The McClean Lake mill
      provides toll milling services to the Cigar Lake Joint Venture (CLJV)
      under the terms of a toll milling agreement between the parties. In
      addition, the Company has varying ownership interests in a number of
      development and exploration projects located in Canada, Mali, Namibia,
      Zambia and Mongolia.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The Company provides mine decommissioning and
      decommissioned site monitoring services to third parties through its
      environmental services division and is also the manager of Uranium
      Participation Corporation (UPC), a publicly-listed investment holding
      company formed to invest substantially all of its assets in uranium oxide
      concentrates (U3O8) and uranium hexafluoride (UF6). The Company has no
      ownership interest in UPC but receives fees for management services and
  commissions from the purchase and sale of U3O8  and UF6 by UPC.                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Denison Mines Corp. (DMC) is incorporated under the
      Business Corporations Act (Ontario) and domiciled in Canada. The address
      of its registered head office is 595 Bay Street, Suite 402, Toronto,
      Ontario, Canada, M5G 2C2.                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | References to 2014 and 2013 refer to the year ended
      December 31, 2014 and the year ended December 31, 2013
  respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2. | BASIS OF PRESENTATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The consolidated financial statements have been prepared
      in accordance with International Financial Reporting Standards (IFRS) as
      issued by the International Accounting Standards Board (IASB).                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The Companys presentation currency is U.S
  dollars.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | These financial statements were approved by the board of
      directors for issue on March 5, 2015.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|3. | ACCOUNTING POLICIES AND RESTATEMENT OF COMPARATIVE
      NUMBERS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | The significant accounting policies used in the
      preparation of these consolidated financial statements are described
      below:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

- 5 -

---

| |     | The financial statements of the Company also include
      various interests in development and exploration projects which are held
      through option or contractual agreements. These have been classified as
      joint ownership interests under IFRS. These joint ownership interests have
      been accounted for using the undivided interest method.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                 
| | (b) | Foreign currency
translation                                                                                                                                                                                                                                                                                                                                    

| | (i)  | Functional and presentation currency                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |      | Items included in the financial statements of each entity
      in the DMC group are measured using the currency of the primary economic
      environment in which the entity operates (the functional currency).
      Primary and secondary indicators are used to determine the functional
      currency (primary indicators have priority over secondary indicators).
      Primary indicators include the currency that mainly influences sales
      prices and the currency that mainly influences labour, material and other
      costs. Secondary indicators include the currency in which funds from
      financing activities are generated and the currency in which receipts from
      operating activities are usually retained. For our entities located in
      Canada, Mongolia, Mali, Namibia, Niger and Zambia, the local currency has
      been determined to be the functional currency.
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |      | The consolidated financial statements are presented in
      U.S. dollars, unless otherwise stated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |      | The financial statements of entities that have a
      functional currency different from the presentation currency of DMC
      (foreign operations) are translated into U.S. dollars as follows: assets
      and liabilities  at the closing rate at the date of the statement of
      financial position, and income and expenses  at the average rate of the
      period (as this is considered a reasonable approximation to actual rates).
      All resulting changes are recognized in other comprehensive income as
      cumulative foreign currency translation adjustments.                                                                                                                                                                                                                                                                                                                        
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |      | When an entity disposes of its entire interest in a
      foreign operation, or loses control, joint control, or significant
      influence over a foreign operation, the foreign currency gains or losses
      accumulated in other comprehensive income related to the foreign operation
      are recognized in profit or loss. If an entity disposes of part of an
      interest in another entity which remains a subsidiary, a proportionate
      amount of foreign currency gains or losses accumulated in other
      comprehensive income related to the subsidiary is reallocated between
      controlling and non-controlling interests.                                                                                                                                                                                                                                                              
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | (ii) | Transactions and balances                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |      | Foreign currency transactions are translated into an
      entitys functional currency using the exchange rates prevailing at the
      dates of the transactions. Foreign exchange gains and losses resulting
      from the settlement of foreign currency transactions and from the
      translation at year-end exchange rates of monetary assets and liabilities
      denominated in currencies other than an operations functional currency
      are recognized in the statement of income.                                                                                                                                                                                                                                                                                                                                                                                                                

| | (c) | Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | Cash and cash equivalents include cash on hand, deposits
      held with banks, and other short-term highly liquid investments with
      original maturities of three months or less which are subject to an
      insignificant risk of changes in value.                                                                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | (d) | Financial instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | Financial assets and financial liabilities are recognized
      when the Company becomes a party to the contractual provisions of the
      financial instrument. Financial assets are derecognized when the rights to
      receive cash flows from the assets have expired or have been transferred
      and the Company has transferred substantially all risks and rewards of
      ownership. Financial liabilities are derecognized when the obligations
      specified in the contract is discharged, cancelled or expires.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | At initial recognition, the Company classifies its
      financial instruments in the following categories:                                                                                                                                                                                                                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

- 6 -

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| | (ii)  | Available-for-sale investments                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | Available-for-sale investments are recognized initially
      at fair value plus transaction costs and are subsequently carried at fair
      value. Gains or losses arising from re-measurement are recognized in other
      comprehensive income. When an available-for-sale investment is sold or
      impaired, the accumulated gains or losses are moved from accumulated other
      comprehensive income to the statement of income.                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (iii) | Held-to-maturity investments                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | Held-to-maturity investments are non-derivative financial
      assets with fixed or determinable payments and fixed maturities that are
      intended to be held to maturity. Held-to-maturity investments are
      initially recognized at fair value plus transaction costs and subsequently
      measured at amortized cost using the effective interest method less a
      provision for impairment.                                                                              
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (iv)  | Loans and receivables                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | Loans and receivables are non-derivative financial assets
      with fixed or determinable payments that are not quoted in an active
      market. Loans and receivables are initially recognized at the amount
      expected to be received, less a discount (when material) to reduce the
      loans and receivables to fair value. Subsequently, loans and receivables
      are measured at amortized cost using the effective interest method less a
      provision for impairment.
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (v)   | Financial liabilities at amortized cost                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |       | Financial liabilities are initially recognized at the
      amount required to be paid, less a discount (when material) to reduce the
      financial liabilities to fair value. Subsequently, financial liabilities
      are measured at amortized cost using the effective interest
  method.                                                                                                                                                                                           

The Company has designated its
financial assets and liabilities as follows:

| | (i)   | Cash and cash equivalents and Trade and other
      receivables are classified as loans and receivables and are measured at
      amortized cost using the effective interest rate method. Interest income
      is recorded in net income through finance income (expense), as
      applicable;                                                                                                                                                                   
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)  | A portion of Investments are classified as FVPL and any
      period change in fair value is recorded in net income through other income
      (expense). The remaining amount is classified as available-for-sale and
      any period change in fair value is recorded in other comprehensive income.
      When the investments value becomes impaired, the loss is recognized in
      net income through other income (expense) in the period of
    impairment;
| | (iii) | Restricted cash and investments is classified as
      held-to-maturity investments; and                                                                                                                                                                                                                                                                                                                                                                              
| | (iv)  | Accounts payable and accrued liabilities and Debt
      obligations are classified as other financial liabilities and are
      measured at amortized cost using the effective interest rate method.
      Interest expense is recorded in net income through finance income
      (expense), as applicable.                                                                                                                                                        

| | (e) | Impairment of financial assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     | At each reporting date, the Company assesses whether
      there is objective evidence that a financial asset (other than a financial
      asset classified as fair value through profit and loss) is impaired.
      Objective evidence of an impairment loss includes: i) significant
      financial difficulty of the debtor; ii) delinquencies in interest or
      principal payments; iii) increased probability that the borrower will
      enter bankruptcy or other financial reorganization; and (iv) in the case
      of equity investments, a significant or prolonged decline in the fair
      value of the security below its cost.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     | If such evidence exists, the Company recognizes an
      impairment loss, as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

- 7 -

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| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (f) | Inventories                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | Expenditures, including depreciation, depletion and
      amortization of production assets, incurred in the mining and processing
      activities that will result in the future concentrate production are
      deferred and accumulated as ore in stockpiles and in-process and
      concentrate inventories. These amounts are carried at the lower of average
      costs or net realizable value (NRV). NRV is the difference between the
      estimated future concentrate price (net of selling costs) and estimated
      costs to complete production into a saleable form.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | Stockpiles are comprised of coarse ore that has been
      extracted from the mine and is available for further processing. Mining
      production costs are added to the stockpile as incurred and removed from
      the stockpile based upon the average cost per tonne of ore produced from
      mines considered to be in commercial production. The current portion of
      ore in stockpiles represents the amount expected to be processed in the
      next twelve months.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | In-process and concentrate inventories include the cost
      of the ore removed from the stockpile, a pro-rata share of the
      amortization of the associated mineral property, as well as production
      costs incurred to process the ore into a saleable product. Processing
      costs typically include labor, chemical reagents and directly attributable
      mill overhead expenditures. Items are valued at weighted average
    cost.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | Materials and other supplies held for use in the
      production of inventories are carried at average cost and are not written
      down below that cost if the finished products in which they will be
      incorporated are expected to be sold at or above cost. However, when a
      decline in the price of concentrates indicates that the cost of the
      finished products exceeds net realizable value, the materials are written
      down to net realizable value. In such circumstances, the replacement cost
      of the materials may be the best available measure of their net realizable
      value.                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | (g) | Property, plant and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | Property, plant and equipment are recorded at acquisition
      or production cost and carried net of depreciation and impairments. Cost
      includes expenditures incurred by the Company that are directly
      attributable to the acquisition of the asset. Subsequent costs are
      included in the assets carrying amount or recognized as a separate asset,
      as appropriate, only when it is probable that future economic benefits
      associated with the item will flow to the Company and the cost can be
      measured reliably. The carrying amount of a replaced asset is derecognized
      when replaced. Repairs and maintenance costs are charged to the statement
      of income during the period in which they are incurred.                                                                                                                                                                                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | Depreciation is calculated on a straight line or unit of
      production basis as appropriate. Where a straight line methodology is
      used, the assets are depreciated to their estimated residual value over an
      estimated useful life which ranges from three to twenty years depending
      upon the asset type. Where a unit of production methodology is used, the
      assets are depreciated to their estimated residual value over the useful
      life defined by managements best estimate of recoverable reserves and
      resources in the current mine plan. When assets are retired or sold, the
      resulting gains or losses are reflected in current earnings as a component
      of other income or expense. The Company allocates the amount initially
      recognized in respect of an item of property, plant and equipment to its
      significant parts and depreciates separately each such part. Residual
      values, method of depreciation and useful lives of the assets are reviewed
      at least annually and adjusted if appropriate.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     | Where straight-line depreciation is utilized, the range
      of useful lives for various asset classes is generally as
  follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

Buildings
    15 - 20 years;Production machinery and equipment
    5 - 7 years;Other
    3 - 5 years;


| | (h) | Mineral property acquisition, exploration and
      development costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     | Costs relating to the acquisition of acquired mineral
      rights and acquired exploration rights are capitalized.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     | Exploration and evaluation expenditures are expensed as
      incurred on mineral properties not sufficiently advanced. At the point in
      time that a mineral property is considered to be sufficiently advanced, it
      is classified as a development mineral property and all further
      expenditures for the current year and subsequent years are capitalized as
      incurred. These costs will include costs of maintaining the site until
      commercial production, costs to initially delineate the ore body, costs
      for shaft sinking and access, lateral development, drift development and infrastructure
      development. Such costs represent the net expenditures incurred and
      capitalized as at the balance sheet date and do not necessarily reflect
      present or future values.

- 8 -

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| |     | Once a development mineral property goes into commercial
      production, the property is classified as Producing and the accumulated
      costs are amortized over the estimated recoverable resources in the
      current mine plan using a unit of production basis. Commercial production
      occurs when a property is substantially complete and ready for its
      intended use.                                                                                                                                                                                                                                                                                                                                                  
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (i) | Identifiable Intangible assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | The Companys identifiable intangible assets are stated
      at cost less accumulated amortization. These assets are capitalized and
      amortized on a straight-line basis in the statement of income over the
      period of their expected useful lives. The useful lives of the assets are
      reviewed at least annually and adjusted if appropriate.                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (j) | Impairment of non-financial assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | Property, plant and equipment and intangible assets are
      tested for impairment when events or changes in circumstances indicate
      that the carrying amount may not be recoverable. For the purpose of
      measuring recoverable amounts, assets are grouped at the lowest levels for
      which there are separately identifiable cash inflows or CGUs. The
      recoverable amount is the higher of an assets fair value less costs of
      disposal and value in use (being the present value of the expected future
      cash flows of the relevant asset or CGU, as determined by management). An
      impairment loss is recognized for the amount by which the CGUs carrying
      amount exceeds its recoverable amount.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (k) | Employee benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

| | (l) | Reclamation provisions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     | Reclamation provisions, any legal and constructive
      obligation related to the retirement of tangible long-lived assets, are
      recognized when such obligations are incurred, if a reasonable estimate of
      the value can be determined. These obligations are measured initially at
      the present value of expected cash flows using a pre-tax discount rate
      reflecting risks specific to the liability and the resulting costs are
      capitalized and added to the carrying value of the related assets. In
      subsequent periods, the liability is adjusted for the accretion of the
      discount and the expense is recorded in the income statement. Changes in
      the amount or timing of the underlying future cash flows or changes in the
      discount rate are immediately recognized as an increase or decrease in the
      carrying amounts of the related asset and liability. These costs are
      amortized to the results of operations over the life of the asset.
      Reductions in the amount of the liability are first applied against
    the amount of the net reclamation asset on the books with any
      excess value being recorded in the statement of operations.

- 9 -

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| |     | The Companys activities are subject to numerous
      governmental laws and regulations. Estimates of future reclamation
      liabilities for asset decommissioning and site restoration are recognized
      in the period when such liabilities are incurred. These estimates are
      updated on a periodic basis and are subject to changing laws, regulatory
      requirements, changing technology and other factors which will be
      recognized when appropriate. Liabilities related to site restoration
      include long-term treatment and monitoring costs and incorporate total
      expected costs net of recoveries. Expenditures incurred to dismantle
      facilities, restore and monitor closed resource properties are charged
      against the related reclamation and remediation liability.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (m) | Provisions                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | Provisions for restructuring costs and legal claims,
      where applicable, are recognized in liabilities when the Company has a
      present legal or constructive obligation as a result of past events, it is
      probable that an outflow of resources will be required to settle the
      obligation, and the amount can be reliably estimated. Provisions are
      measured at managements best estimate of the expenditure required to
      settle the obligation at the end of the reporting period, and are
      discounted to present value where the effect is material. The Company
      performs evaluations to identify onerous contracts and, where applicable,
      records provisions for such contracts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (n) | Current and Deferred Income tax                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | Income taxes are accounted for using the liability method
      of accounting for deferred income taxes. Under this method, the tax
      currently payable is based on taxable income for the period. Taxable
      income differs from income as reported in the consolidated statement of
      income (loss) because it excludes items of income or expense that are
      taxable or deductible in other periods and it further excludes items that
      are never taxable or deductible. The Companys liability for current tax
      is calculated using tax rates that have been enacted or substantively
      enacted by the balance sheet date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | Deferred income tax assets and liabilities are recognized
      based on temporary differences between the financial statement carrying
      values of the existing assets and liabilities and their respective income
      tax bases used in the computation of taxable income. Deferred tax
      liabilities are generally recognized for all taxable temporary differences
      and deferred tax assets are recognized to the extent that it is probable
      that taxable income will be available against which deductible temporary
      differences can be utilized. Such assets and liabilities are not
      recognized if the temporary difference arises from goodwill or from the
      initial recognition (other than in a business combination) of other assets
      and liabilities in a transaction that affects neither the taxable income
      nor the accounting income. Deferred tax liabilities are recognized for
      taxable temporary differences arising on investments in subsidiaries and
      investments, and interests in joint ventures, except where the Company is
      able to control the reversal of the temporary differences and it is
      probable that the temporary differences will not reverse in the
      foreseeable future. Deferred tax assets are recognized to the extent that
      taxable income will be available against which the deductible temporary
      differences can be utilized. The carrying amount of deferred tax assets is
      reviewed at each balance sheet date and reduced to the extent that it is
      no longer probable that sufficient taxable earnings will be available to
      allow all or part of the asset to be recovered.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | Deferred tax is calculated at the tax rates that are
      expected to apply in the period when the liability is settled or the asset
      realized, based on tax rates and tax laws that have been enacted or
      substantively enacted by the balance sheet date. Deferred tax is charged
      or credited to income, except when it relates to items charged or credited
      directly to equity, in which case the deferred tax is also recorded within
      equity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | Income tax assets and liabilities are offset when there
      is a legally enforceable right to offset the assets and liabilities and
      when they relate to income taxes levied by the same tax authority on
      either the same taxable entity or different taxable entities where there
      is an intention to settle the balance on a net basis.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (o) | Flow-Through Common Shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | The Companys Canadian exploration activities have been
      financed in part through the issuance of flow- through common shares
      whereby the tax benefits of the eligible exploration expenditures incurred
      under this arrangement are renounced to the subscribers. The proceeds from
      issuing flow-through shares are allocated between the offering of shares
      and the sale of tax benefits. The allocation is based on the difference
      (premium) between the quoted price of the Companys existing shares and
      the amount the investor pays for the actual flow-through shares. A
      liability is recognized for the premium, and is extinguished when the tax
      effect of the temporary differences, resulting from the renunciation, is
      recorded  with the difference between the liability and the value of the
      tax assets renounced being recorded as a deferred tax expense. The tax
      effect of the renunciation is recorded at the time the Company makes
      the renunciation  which may differ from the effective date
      of renunciation. If the flow-through shares are not issued at a premium, a
      liability is not established, and on renunciation the full value of the
      tax assets renounced is recorded as a deferred tax expense.                                                                                                                                                                                                                                                                                                                                                                                              

- 10 -

---

| | (p) | Revenue recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Revenue from the sale of mineral concentrates is
      recognized when it is probable that the economic benefits will flow to the
      Company. This is generally the case once delivery has occurred, the sales
      price and costs incurred with respect to the transaction can be measured
      reliably and collectability is reasonably assured. For uranium, revenue is
      typically recognized when delivery is evidenced by book transfer at the
      applicable uranium storage facility.                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Revenue from toll milling services is recognized as
      material is processed in accordance with the specifics of the applicable
      toll milling agreement. Revenue and unbilled accounts receivable are
      recorded as related costs are incurred using billing formulas included in
      the applicable toll milling agreement.                                                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Revenue on environmental service contracts is recognized
      using the percentage of completion method, whereby sales, earnings and
      unbilled accounts receivable are recorded as related costs are incurred.
      Earnings rates are adjusted periodically as a result of revisions to
      projected contract revenues and estimated costs of completion. Losses, if
      any, are recognized fully when first anticipated. Revenues from
      engineering services are recognized as the services are provided in
      accordance with customer agreements.
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Management fees from UPC are recognized as management
      services are provided under the contract on a monthly basis. Commission
      revenue earned on acquisition or sale of U3O8  and UF6 on behalf of UPC (or
      other parties where Denison acts as an agent) is recognized on the date
  when title passes.                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (q) | Earnings (loss) per share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Basic earnings per share (EPS) is calculated by
      dividing the net income (loss) for the period attributable to equity
      owners of DMC by the weighted average number of common shares outstanding
      during the period.                                                                                                                                                                                                                                                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Diluted EPS is calculated by adjusting the weighted
      average number of common shares outstanding for dilutive instruments. The
      number of shares included with respect to options, warrants and similar
      instruments is computed using the treasury stock
method.                                                                                                                                                                                                                                                                                          

Accounting Standards Adopted

The Company has adopted the following
new and revised accounting standards, along with any consequential amendments,
effective January 1, 2014. These changes were made in accordance with the
applicable transitional provisions.

International Accounting
Standard 36, Impairment of Assets (IAS 36)

IAS 36 was amended in May 2013 to make
small changes to the disclosures required by IAS 36 when an impairment loss is
recognized or reversed. The amendments require the disclosure of the recoverable
amount of an asset or cash generating unit (CGU) at the time an impairment
loss has been recognized or reversed and detailed disclosure of how the
associated fair value less costs of disposal has been determined.

The amendments are effective for
accounting periods beginning on or after January 1, 2014 with earlier adoption
permitted. The Company has adopted the amended disclosure requirements of IAS 36
effective January 1, 2014.

Accounting Standards Issued But Not
Yet Applied

The Company has not yet adopted the
following new accounting pronouncements which are effective for fiscal periods
of the Company beginning on or after January 1, 2015:

International Financial
Reporting Standard 9, Financial Instruments (IFRS 9)

IFRS 9 was issued in October 2010 by
the IASB to replace IAS 39, Financial Instruments  Recognition and Measurement.
The replacement standard has the following significant components: it
establishes two primary measurement categories for financial assets  amortized
cost and fair value; it establishes criteria for the classification of financial
assets within the measurement category based on business model and cash flow
characteristics; and it eliminates existing held to maturity,
available-for-sale, and loans and receivable categories.

- 11 -

---

In November 2013, the IASB issued an
amendment to IFRS 9 which includes a new hedge model that aligns accounting more
closely with risk management and enhances disclosure about hedge accounting and
risk management. Additionally, as the impairment guidance and certain limited
amendments to the classification and measurement requirements of IFRS 9 are not
yet complete, the previously mandated effective date of IFRS 9 of January 1,
2015 has been removed. Entities may apply IFRS 9 before the IASB completes the
amendments but are not required to do so.

The Company has not evaluated the
impact of adopting this standard.

International Financial
Reporting Standard 15, Revenue from Contracts with Customers (IFRS
15)

IFRS 15 deals with revenue recognition
and establishes principles for reporting useful information to users of
financial statements about the nature, amount, timing and uncertainty of revenue
and cash flows arising from an entitys contracts with customers. Revenue is
recognized when a customer obtains control of a good or service. The standard
replaces IAS 18 Revenue and IAS 11Construction Contracts and related
interpretations. The standard is effective for annual periods beginning on or
after January 1, 2017 and earlier application is permitted.

The Company has not evaluated the
impact of adopting this standard.

|   | Comparative Numbers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Certain classifications of the comparative figures have
      been changed to conform to those used in the current period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|4. | CRITICAL ACCOUNTING ESTIMATES AND
  JUDGEMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The preparation of consolidated financial statements in
      accordance with IFRS requires the use of certain critical accounting
      estimates and judgements that affect the amounts reported. It also
      requires management to exercise judgement in applying the Companys
      accounting policies. These judgements and estimates are based on
      managements best knowledge of the relevant facts and circumstances taking
      into account previous experience. Although the Company regularly reviews
      the estimates and judgements made that affect these financial statements,
      actual results may be materially different.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Significant estimates and judgements made by management
      relate to:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

- 12 -

---

| | (c) | Deferred Tax Assets and Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Deferred tax assets and liabilities are recognized for
      the future tax consequences attributable to differences between the
      financial statement carrying amounts of existing assets and liabilities
      and their respective tax bases. The Company computes deferred tax assets
      and liabilities in respect of taxes that are based on taxable profit.
      Taxable profit is understood to be a net, rather than gross, taxable
      amount that gives effect to both revenues and expenses. Taxable profit
      will often differ from accounting profit and management may need to
      exercise judgment to determine whether some taxes are income taxes
      (subject to deferred tax accounting) or operating expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Deferred tax assets and liabilities are measured using
      enacted or substantially enacted tax rates expected to apply when the
      differences are expected to be recovered or settled. The determination of
      the ability of the Company to utilize tax loss carry forwards to offset
      deferred tax liabilities requires management to exercise judgment and make
      certain assumptions about the future performance of the Company.
      Management is required to assess whether it is probable that the Company
      will benefit from these prior losses and other deferred tax assets.
      Changes in economic conditions, commodity prices and other factors could
      result in revisions to the estimates of the benefits to be realized or the
      timing of utilizing the losses.                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (d) | Reclamation Obligations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |     | Asset retirement obligations are recorded as a liability
      when the asset is initially constructed. Denison has accrued its best
      estimate of the ongoing reclamation liability in connection with the
      decommissioned Elliot Lake mine site and is currently accruing its best
      estimate of its share of the cost to decommission its other mining and
      milling properties in accordance with existing laws, contracts and other
      policies. The estimate of future costs involves a number of estimates
      relating to timing, type of costs, mine closure plans, and review of
      potential methods and technical advancements. Furthermore, due to
      uncertainties concerning environmental remediation, the ultimate cost of
      the Companys decommissioning liability could differ from amounts
      provided. The estimate of the Companys obligation is subject to change
      due to amendments to applicable laws and regulations and as new
      information concerning the Companys operations becomes available. The
      Company is not able to determine the impact on its financial position, if
      any, of environmental laws and regulations that may be enacted in the
      future.

|5. | ACQUISITIONS AND DIVESTITURES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | Acquisition of International Enexco
  Limited                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | On June 6, 2014, Denison completed a plan of arrangement
      (the IEC Arrangement) to acquire all of the outstanding shares, options
      and warrants of International Enexco Limited (IEC). IECs principal
      uranium assets include a 30% interest in the Mann Lake exploration project
      and a 20% interest in the Bachman Lake Joint Venture, both located in
      Saskatchewan, Canada. Prior to completing the IEC Arrangment, IEC also
      owned a subsidiary holding an indirect interest in IECs Contact Copper
      project and its other US properties (Spinco).             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | Pursuant to the IEC Arrangement, the former shareholders
      of IEC ultimately exchanged each IEC common share held for 0.26 of a
      Denison common share (the Exchange Ratio). Outstanding warrants and
      options of IEC were exchanged for options and warrants of Denison adjusted
      by the Exchange Ratio. The Denison options received on exchange expired 90
      days after the IEC Arrangement completion date while the Denison warrants
      received on exchange retained the expiry dates of the originally issued
      IEC warrants.                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | As part of the IEC Arrangement, IECs shareholders also
      received a pro rata distribution of Spinco shares on a one-for-one basis
      and one-half of a warrant to acquire an additional Spinco share,
      exercisable for 6 months, at a price of CAD$5.00 for each whole share to
      be acquired. Each holder of IEC options and warrants also received
      replacement options and warrants, as the case may be, from Spinco with the
      same terms and conditions as the IEC options and warrants being
      replaced.                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | For accounting purposes, IEC is not considered a business
      under IFRS 3 Business Combinations as at the time of the acquisition it
      is not capable of generating outputs that can provide a return to Denison.
      As a result, the IEC Arrangement has been accounted for as an asset
      acquisition with share based consideration. Transaction costs incurred by
      Denison related to the IEC Arrangement have been capitalized as part of
      the consideration amount. Denison is including the results of IEC as part
      of its Canadian mining segment for reporting
purposes.

- 13 -

---

The following table summarizes the fair
value of the IEC assets acquired and the liabilities assumed at the acquisition
date of June 6, 2014:

| |                                          |   | IEC              | 
| | ---------------------------------------- | - | ---------------- | 
| | (in thousands)                           |   | Fair
      Value | 
| |                                          |   |                  | 
| | Cash and cash equivalents                | $ | 206              | 
| | Trade and other receivables              |   | 421              | 
| | Prepaid expenses and other               |   | 15               | 
| | Property, plant and equipment            |   |                  | 
| | Mineral properties - Canada              |   | 14,120           | 
| | Total assets                             |   | 14,762           | 
| |                                          |   |                  | 
| | Accounts payable and accrued liabilities |   | 1,319            | 
| | Reclamation obligations                  |   | 20               | 
| | Net assets                               | $ | 13,423           | 

The total consideration relating to the
IEC Arrangement is summarized below:

| | (in thousands except for share amounts)                                      |   |        | 
| | ---------------------------------------------------------------------------- | - | ------ | 
| |                                                                              |   |        | 
| | Fair value of 10,229,035 common shares
      issued by Denison               | $ | 11,979 | 
| | Fair value of 660,127 common share purchase warrants issued
      by Denison |   | 61     | 
| | Fair value of 902,200 common share options
      issued by Denison           |   | 102    | 
| | Fair value of IEC shares held by Denison prior to
      acquisition          |   | 934    | 
| | Costs incurred by the Company pursuant to
      arrangement:                 |   |        | 
| | Transaction costs                                                            |   | 347    | 
| | Fair value of total consideration                                            | $ | 13,423 | 

The fair value of the common shares was
determined using Denisons closing share price on June 6, 2014 of CAD$1.28
converted to USD$ using the June 6, 2014 foreign exchange rate of 0.9149.

The fair value of the common share
purchase warrants issued by Denison to replace those of IEC totaled $61,000 or
$0.0924 per warrant. The fair value was determined using the Black-Scholes
option pricing model with the following assumptions: risk-free interest rate of
1.06%, expected stock price volatility between 38.56% and 48.62%, expected life
between 0.50 years and 1.25 years and expected dividend yield of nil%.

The fair value of the common share
options issued by Denison to replace those of IEC totaled $102,000 or $0.1131
per option. The fair value was determined using the Black-Scholes option pricing
model with the following assumptions: risk-free interest rate of 1.06%, expected
stock price volatility of 34.85%, expected life of 0.25 years and expected
dividend yield of nil%. As at June 6, 2014, all of the options issued to replace
the IEC options were fully-vested.

Acquisition of Rockgate Capital Corp

In September 2013, Denison formally
commenced a takeover bid to acquire all of the outstanding shares of Rockgate
Capital Corp. (Rockgate). Rockgates key mining asset is its Falea
uranium-copper-silver project located in Mali.

Under the terms of the takeover bid,
Rockgate shareholders received 0.192 of a common share of Denison for each
Rockgate share held. As at December 6, 2013, Denison had acquired 104,852,532
shares of Rockgate, equivalent to an initial 89.72% ownership amount and valued
the remaining 12,014,561 shares of Rockgate (or 10.28%) owned by non-controlling
interests at $3,091,000. On January 17, 2014, pursuant to a plan of arrangement
with the same terms as the takeover bid, Denison acquired the remaining 10.28%
non-controlling interest of Rockgate it had not previously acquired under its
takeover bid in 2013.

For accounting purposes, Rockgate is
not considered a business under IFRS 3 Business Combinations as at the time of
the acquisition it is not capable of generating outputs that can provide a
return to Denison. As a result, the Rockgate transaction has been accounted for
as an asset acquisition with share based consideration. Transaction costs
incurred by Denison related to the Rockgate transaction have been capitalized as
part of the consideration amount. Denison is including the results of Rockgate
as part of its African mining segment for reporting purposes.

- 14 -

---

For accounting purposes, Denison has
used a cut-off date of November 30, 2013 to fair value the acquisition. The
following table summarizes the fair value of the Rockgate assets acquired and
the liabilities assumed as at November 30, 2013. The fair values have been
adjusted to reflect the acquisition of the non-controlling interest noted above
as if it had occurred on November 30, 2013:

| |                                               |   | Rockgate         | 
| | --------------------------------------------- | - | ---------------- | 
| | (in thousands)                                |   | Fair
      Value | 
| |                                               |   |                  | 
| | Cash and cash equivalents                     | $ | 512              | 
| | Trade and other receivables                   |   | 173              | 
| | Prepaid expenses and other                    |   | 54               | 
| | Investments-debt instruments                  |   | 14,810           | 
| | Investments-equity instruments                |   | 11               | 
| | Property, plant and equipment                 |   |                  | 
| | Plant
      and equipment                     |   | 523              | 
| | Mineral properties  Mali                     |   | 11,996           | 
| | Mineral properties - Niger                    |   | 94               | 
| | Total assets                                  |   | 28,173           | 
| |                                               |   |                  | 
| | Account payable
      and accrued liabilities |   | 1,821            | 
| | Net assets                                    | $ | 26,352           | 

The total consideration relating to the
acquisition of Rockgate is summarized below:

| | (in thousands except for share amounts)                                                 |   |        | 
| | --------------------------------------------------------------------------------------- | - | ------ | 
| |                                                                                         |   |        | 
| | Fair value of 20,131,665 common shares
      issued by Denison under takeover bid       | $ | 21,760 | 
| | Fair value of 2,312,622 common shares issued by Denison
      under plan of arrangement |   | 3,034  | 
| | Costs incurred by the Company pursuant to
      the acquisition:                        |   |        | 
| | Takeover bid transaction costs                                                          |   | 1,501  | 
| | Plan of arrangement transaction
      costs                                             |   | 57     | 
| | Fair value of
      total consideration                                                 | $ | 26,352 | 

The fair value of the common shares
issued by Denison under the takeover bid totaled $21,760,000. The fair value of
the common shares was determined using Denisons closing share price on the
dates shares were issued pursuant to the takeover bid converted to USD on the
applicable days closing rate. Under the bid, shares were issued between
November 19, 2013 and December 6, 2013 and the fair value has been determined
using closing share prices ranging from CAD$1.13 to CAD$1.20 per share and
foreign exchange rates ranging from 0.9384 to 0.9550.

The fair value of the common shares
issued by Denison under the plan of arrangement to acquire the non-controlling
interest totaled $3,034,000. The fair value of the common shares was determined
using Denisons closing share price on January 17, 2014 of CAD$1.44 converted to
USD$ using the January 17, 2014 foreign exchange rate of 0.9111.

Acquisition of Fission Energy Corp

On April 26, 2013, Denison completed an
arrangement agreement (the Fission Arrangement) to acquire Fission Energy
Corp. (Fission) whose assets included its 60% interest in the Waterbury Lake
uranium project, its interests in all other properties in the eastern part of
the Athabasca Basin, Quebec and Nunavut, as well as its interests in two joint
ventures in Namibia (collectively, the Assets).

Under the terms of the Fission
Arrangement, Fission shareholders received 0.355 of a common share of Denison, a
nominal cash payment of CAD$0.0001 and one common share of a newly-formed
publicly traded company, Fission Uranium Corp., for each Fission share held. All
of the outstanding options of Fission were exchanged for options to purchase
common shares of Denison with a number and exercise price determined by
reference to the 0.355 exchange ratio and a volume adjusted market value factor.
Share purchase warrants in Fission (Fission Warrant) that were outstanding on
completion of the Fission Arrangement survived the transaction and may still be
exercised in accordance with their terms, so that the holder of a Fission
Warrant will receive the number of Denison shares, shares of Fission Uranium
Corp and nominal cash consideration which the warrant holder would have received
had the Fission Warrants been exercised immediately prior to the Fission
Arrangement. The proceeds from the Fission Warrant exercise will be split
between Denison and Fission Uranium Corp. and each company will be responsible
for issuing its respective shares on the exercise of a Fission Warrant. Cash
consideration was also advanced to Fission prior to closing (the Fission Loan)
and included an amount of CAD$2,437,000 in
respect of the expenditures incurred and paid by Fission between January 16,
2013 and April 25, 2013 on properties that were ultimately acquired by Denison.

- 15 -

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For accounting purposes, Fission is not
considered a business under IFRS 3 Business Combinations as at the time of the
acquisition it is not capable of generating outputs that can provide a return to
Denison. As a result, the Fission Arrangement has been accounted for as an asset
acquisition with share based consideration. Transaction costs incurred by
Denison related to the Fission Arrangement have been capitalized as part of the
consideration amount. Denison is including the results of Fission as part of its
Canadian and African mining segments for reporting purposes.

The following table summarizes the fair
value of the Fission assets acquired and the liabilities assumed at the
acquisition date of April 26, 2013:

| |                                               |   | Fission          | 
| | --------------------------------------------- | - | ---------------- | 
| | (in thousands)                                |   | Fair
      Value | 
| |                                               |   |                  | 
| | Cash and cash equivalents                     | $ | 930              | 
| | Trade and other receivables                   |   | 82               | 
| | Property, plant and equipment                 |   |                  | 
| | Mineral properties  Canada                   |   | 66,945           | 
| | Mineral properties - Namibia                  |   | 5,949            | 
| | Total assets                                  |   | 73,906           | 
| |                                               |   |                  | 
| | Account payable
      and accrued liabilities |   | 511              | 
| | Net assets                                    | $ | 73,395           | 

The total consideration relating to the
Fission Arrangement is summarized below:

| | (in thousands except for share amounts)                                         |   |        | 
| | ------------------------------------------------------------------------------- | - | ------ | 
| |                                                                                 |   |        | 
| | Fair value of 53,053,284 common shares
      issued by Denison                  | $ | 66,259 | 
| | Fair value of 1,500,854 common share purchase warrants
      assumed by Denison |   | 827    | 
| | Fair value of 1,985,035 common share
      options issued by Denison            |   | 1,321  | 
| | Costs incurred by the Company pursuant to arrangement:                          |   |        | 
| | Fission Loan                                                                    |   | 3,321  | 
| | Transaction costs                                                               |   | 1,667  | 
| | Fair value of total consideration                                               | $ | 73,395 | 

The fair value of the common shares was
determined using Denisons closing share price on April 26, 2013 of CAD$1.27
converted to USD$ using the April 26, 2013 foreign exchange rate of 0.9834.

The fair value of the common share
purchase warrants assumed by Denison totaled $827,000 or $0.55 per warrant, on
average. The fair value was determined using the Black-Scholes option pricing
model with the following assumptions: risk-free interest rate of 0.98%, expected
stock price volatility between 40.23% and 56.06%, expected life between 0.60
years and 1.70 years and expected dividend yield of nil%.

The fair value of the common share
options issued by Denison to replace those of Fission totaled $1,321,000 or
$0.67 per option, on average. The fair value was determined using the
Black-Scholes option pricing model with the following assumptions: risk-free
interest rate between 0.98% and 1.12%, expected stock price volatility between
39.87% and 84.93%, expected life between 0.20 years and 4.70 years and expected
dividend yield of nil%. As at April 26, 2013, all of the options issued by
Denison to replace the Fission options are fully-vested.

Acquisition of JNR Resources Inc.

On January 31, 2013, Denison completed
a plan of arrangement (the JNR Arrangement) to acquire all of the outstanding
common shares of JNR Resources Inc. (JNR). Pursuant to the JNR Arrangement,
the former shareholders of JNR received, for each JNR common share held, 0.073
of a Denison common share (the Exchange Ratio). No fractional shares were
issued. All of the outstanding options and common share purchase warrants of JNR
were exchanged for options and warrants to purchase common shares of Denison
with a number and exercise price determined by reference to the Exchange Ratio.

For accounting purposes, JNR Resources
is not considered a business under IFRS 3 Business Combinations as at the time
of the acquisition it is not capable of generating outputs that can provide a
return to Denison. As a result, the JNR Arrangement has been accounted for as an
asset acquisition with share based consideration.

- 16 -

---

Transaction costs incurred by Denison
related to the JNR Arrangement have been capitalized as part of the
consideration amount. Denison is including the results of JNR as part of its
Canadian mining segment for reporting purposes.

The following table summarizes the fair
value of the JNR assets acquired and the liabilities assumed at the acquisition
date of January 31, 2013:

| |                                               |   | JNR              | 
| | --------------------------------------------- | - | ---------------- | 
| | (in thousands)                                |   | Fair
      Value | 
| |                                               |   |                  | 
| | Cash and cash equivalents                     | $ | 39               | 
| | Trade and other receivables                   |   | 50               | 
| | Prepaid expenses and other                    |   | 7                | 
| | Investments                                   |   | 22               | 
| | Property, plant and equipment                 |   |                  | 
| | Plant and equipment                           |   | 62               | 
| | Mineral properties - Canada                   |   | 13,012           | 
| | Total assets                                  |   | 13,192           | 
| |                                               |   |                  | 
| | Account payable
      and accrued liabilities |   | 767              | 
| | Net assets                                    | $ | 12,425           | 

The total consideration relating to the
JNR Arrangement is summarized below:

| | (in thousands except for share amounts)                                      |   |        | 
| | ---------------------------------------------------------------------------- | - | ------ | 
| |                                                                              |   |        | 
| | Fair value of 7,975,479 common shares
      issued by Denison                | $ | 10,956 | 
| | Fair value of 272,290 common share purchase warrants issued
      by Denison |   | 17     | 
| | Fair value of 579,255 common share options
      issued by Denison           |   | 131    | 
| | Fair value of JNR shares held by Denison prior to
      acquisition          |   | 567    | 
| | Costs incurred by the Company pursuant to
      arrangement:                 |   |        | 
| | JNR loan                                                                     |   | 351    | 
| | Transaction costs                                                            |   | 403    | 
| | Fair value of
      total consideration                                      | $ | 12,425 | 

|   | The fair value of the common shares was determined using
      Denisons closing share price on January 31, 2013 of CAD$1.37 converted to
      USD$ using the January 31, 2013 foreign exchange rate of 1.0027.                                                                                                                                                                                                                                                                                                                                                                 
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | The fair value of the common share purchase warrants
      issued by Denison to replace those of JNR totaled $17,000 or $0.0615 per
      warrant. The fair value was determined using the Black-Scholes option
      pricing model with the following assumptions: risk-free interest rate of
      1.16%, expected stock price volatility of 47.58%, expected life of 0.75
      years and expected dividend yield of nil%.                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | The fair value of the common share options issued by
      Denison to replace those of JNR totaled $131,000 or $0.2262 per option.
      The fair value was determined using the Black-Scholes option pricing model
      with the following assumptions: risk-free interest rate between 1.16% and
      1.42%, expected stock price volatility between 58.00% and 62.15%, expected
      life between 0.04 years and 3.70 years and expected dividend yield of
      nil%. As at January 31, 2013, all of the options issued to replace the JNR
      options are fully-vested.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|6. | CASH AND CASH EQUIVALENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | The cash and cash equivalent balance consists
  of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

| |                       |   | At
      December 31 |  |   | At
      December 31 | 
| | --------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)        |   | 2014                 |  |   | 2013                 | 
| |                       |   |                      |  |   |                      | 
| | Cash                  | $ | 2,265                |  | $ | 2,259                | 
| | Cash in MLJV and MWJV |   | 885                  |  |   | 3,057                | 
| | Cash equivalents      |   | 15,490               |  |   | 16,470               | 
| |                       | $ | 18,640               |  | $ | 21,786               | 

- 17 -

---

|7. | TRADE AND OTHER RECEIVABLES                             
|-- | --------------------------------------------------------
|   |                                                         
|   | The trade and other receivables balance consists
    of:

| |                              |   | At
      December 31 |  |   | At
      December 31 | 
| | ---------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)               |   | 2014                 |  |   | 2013                 | 
| |                              |   |                      |  |   |                      | 
| | Trade receivables  other    | $ | 2,138                |  | $ | 1,966                | 
| | Receivables in MLJV and MWJV |   | 7,127                |  |   | 1,794                | 
| | Sales tax receivables        |   | 131                  |  |   | 378                  | 
| | Sundry receivables           |   | 15                   |  |   | 10                   | 
| |                              | $ | 9,411                |  | $ | 4,148                | 

|8. | INVENTORIES                         
|-- | ------------------------------------
|   |                                     
|   | The inventories balance consists
of:

| |                                           |   | At
      December 31 |  |   | At
      December 31 | 
| | ----------------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                            |   | 2014                 |  |   | 2013                 | 
| |                                           |   |                      |  |   |                      | 
| | Uranium concentrates and work-in-progress | $ | 433                  |  | $ | 4                    | 
| | Inventory of ore in stockpiles            |   | 1,834                |  |   | 2,058                | 
| | Mine and mill supplies                    |   | 1,733                |  |   | 1,722                | 
| |                                           | $ | 4,000                |  | $ | 3,784                | 
| |                                           |   |                      |  |   |                      | 
| | Inventories - by duration:                |   |                      |  |   |                      | 
| | Current                                   | $ | 2,240                |  | $ | 2,123                | 
| | Long-term  ore in stockpiles             |   | 1,760                |  |   | 1,661                | 
| |                                           | $ | 4,000                |  | $ | 3,784                | 

|   | Long-term ore in stockpile inventory represents an
      estimate of the amount of ore on the stockpile in excess of the next
      twelve months of planned mill production.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                              
|9. | INVESTMENTS                                                                                                                                                                  
|   |                                                                                                                                                                              
|   | The investments balance consists
of:                                                                                                                                         

| |                                                             |   | At
      December 31 |  |   | At
      December 31 | 
| | ----------------------------------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                                              |   | 2014                 |  |   | 2013                 | 
| |                                                             |   |                      |  |   |                      | 
| | Investments:                                                |   |                      |  |   |                      | 
| | Equity instruments-fair value
      through profit and loss | $ | 932                  |  | $ | 1,106                | 
| | Equity instruments-available for sale                       |   | 22                   |  |   | 17                   | 
| | Debt instruments-fair value through profit
      and loss   |   | 4,381                |  |   | 14,818               | 
| |                                                             | $ | 5,335                |  | $ | 15,941               | 
| |                                                             |   |                      |  |   |                      | 
| | Investments  by duration                                   |   |                      |  |   |                      | 
| | Current                                                     | $ | 4,381                |  | $ | 10,040               | 
| | Long-term                                                   |   | 954                  |  |   | 5,901                | 
| |                                                             | $ | 5,335                |  | $ | 15,941               | 

At December 31, 2014, investments
include equity instruments in publicly-traded companies with a fair value of
$954,000 (December 31, 2013: $1,123,000).

At December 31, 2014, investments
include debt instruments with a fair value of $4,381,000 (December 31, 2013:
$14,818,000). The debt instruments at December 31, 2014 consist of guaranteed
investment certificates with rates of interest ranging between 1.85% to 1.90%
and maturity dates occurring in February 2015.

- 18 -

---

|    | Investment Purchases, Impairments and Other
      Movements                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | During 2014, the Company purchased additional equity
      instruments at a cost of $569,000. In addition, $9,529,000 of debt
      instruments matured and the proceeds were transferred to cash and
      equivalents.                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | During 2014 and 2013, the Company recorded impairment
      charges on equity instruments of $22,000 and $39,000, respectively. The
      resulting loss has been included in other income (expense) in the
      consolidated statements of income (loss) (see note 22).                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | During 2014, an amount of $934,000 was transferred out of
      fair value through profit and loss equity instruments as part of the IEC
      acquisition (see note 5). During 2013, an amount of $567,000 was
      transferred out of available for sale equity instruments as part of the
      JNR acquisition (see note 5). These transfers represented the fair value
      of the equity instruments held by the Company on the date of acquisition
      of IEC and JNR.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|10. | RESTRICTED CASH AND INVESTMENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | The Company has certain restricted cash and investments
      deposited to collateralize its reclamation obligations. The restricted
      cash and investments balance consists of:                                                                                                                                                                                                                                                                                             

| |                                            |   | At
      December 31 |  |   | At
      December 31 | 
| | ------------------------------------------ | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                             |   | 2014                 |  |   | 2013                 | 
| |                                            |   |                      |  |   |                      | 
| | Cash                                       | $ | 42                   |  | $ | 26                   | 
| | Cash equivalents                           |   | 104                  |  |   | 221                  | 
| | Investments                                |   | 1,922                |  |   | 2,052                | 
| |                                            | $ | 2,068                |  | $ | 2,299                | 
| |                                            |   |                      |  |   |                      | 
| | Restricted cash and investments  by item: |   |                      |  |   |                      | 
| | Elliot Lake reclamation trust fund         | $ | 2,068                |  | $ | 2,299                | 
| |                                            | $ | 2,068                |  | $ | 2,299                | 

Elliot Lake Reclamation Trust Fund

The Company has the obligation to
maintain its decommissioned Elliot Lake uranium mine pursuant to a Reclamation
Funding Agreement effective December 21, 1995 (Agreement) with the Governments
of Canada and Ontario. The Agreement, as further amended in February 1999,
requires the Company to maintain funds in the Reclamation Trust Fund equal to
estimated reclamation spending for the succeeding six calendar years, less
interest expected to accrue on the funds during the period. Withdrawals from
this Reclamation Trust Fund can only be made with the approval of the
Governments of Canada and Ontario to fund Elliot Lake monitoring and site
restoration costs.

In 2014, the Company deposited an
additional $545,000 (CAD$603,000) into the Elliot Lake Reclamation Trust Fund
and withdrew $617,000 (CAD$680,000). In 2013, the Company deposited an
additional $1,029,000 (CAD$1,047,000) into the Elliot Lake Reclamation Trust
Fund and withdrew $846,000 (CAD$873,000).

- 19 -

---

|11. | PROPERTY, PLANT AND EQUIPMENT                             
|--- | ----------------------------------------------------------
|    |                                                           
|    | The property, plant and equipment balance consists
    of:

| |                          |   | At
      December 31 |   |   | At
      December 31 |  
| | ------------------------ | - | -------------------- | - | - | -------------------- | -
| | (in thousands)           |   | 2014                 |   |   | 2013                 |  
| |                          |   |                      |   |   |                      |  
| | Plant and equipment:     |   |                      |   |   |                      |  
| | Cost                     | $ | 82,980               |   | $ | 86,805               |  
| | Construction-in-progress |   | 6,960                |   |   | 7,516                |  
| | Accumulated depreciation |   | (12,205              | ) |   | (12,627              | )
| | Net book value           | $ | 77,735               |   | $ | 81,694               |  
| |                          |   |                      |   |   |                      |  
| | Mineral properties:      |   |                      |   |   |                      |  
| | Cost                     | $ | 192,851              |   | $ | 199,532              |  
| | Accumulated amortization |   | (198                 | ) |   | (216                 | )
| | Net book value           | $ | 192,653              |   | $ | 199,316              |  
| |                          |   |                      |   |   |                      |  
| | Net book value           | $ | 270,388              |   | $ | 281,010              |  

The plant and equipment continuity
summary is as follows:

| |                                        |   |        |   |   | Accumulated    |   |   |                  |  
| | -------------------------------------- | - | ------ | - | - | -------------- | - | - | ---------------- | -
| |                                        |   |        |   |   | Amortization / |   |   | Net              |  
| | (in thousands)                         |   | Cost   |   |   | Depreciation   |   |   | Book
      Value |  
| |                                        |   |        |   |   |                |   |   |                  |  
| | Plant and equipment:                   |   |        |   |   |                |   |   |                  |  
| | Balance  January 1, 2013              | $ | 99,347 |   | $ | (12,143        | ) | $ | 87,204           |  
| | Additions                              |   | 1,192  |   |   | -              |   |   | 1,192            |  
| | Amortization                           |   | -      |   |   | (36            | ) |   | (36              | )
| | Asset acquisitions (note 5)            |   | 1,536  |   |   | (950           | ) |   | 586              |  
| | Depreciation                           |   | -      |   |   | (796           | ) |   | (796             | )
| | Disposals                              |   | (475   | ) |   | 405            |   |   | (70              | )
| | Reclamation adjustment                 |   | (833   | ) |   | 77             |   |   | (756             | )
| | Foreign exchange                       |   | (6,446 | ) |   | 816            |   |   | (5,630           | )
| | Balance  December 31, 2013            | $ | 94,321 |   | $ | (12,627        | ) | $ | 81,694           |  
| |                                        |   |        |   |   |                |   |   |                  |  
| | Additions                              |   | 240    |   |   | -              |   |   | 240              |  
| | Amortization                           |   | -      |   |   | (15            | ) |   | (15              | )
| | Depreciation                           |   | -      |   |   | (817           | ) |   | (817             | )
| | Disposals                              |   | (67    | ) |   | 67             |   |   | -                |  
| | Reclamation adjustment (note
      14) |   | 3,502  |   |   | 14             |   |   | 3,516            |  
| | Foreign exchange                       |   | (8,056 | ) |   | 1,173          |   |   | (6,883           | )
| | Balance  December 31, 2014            | $ | 89,940 |   | $ | (12,205        | ) | $ | 77,735           |  

- 20 -

---

The mineral property continuity summary
is as follows:

| |                             |   |         |   |   | Accumulated  |   |   | Net              |  
| | --------------------------- | - | ------- | - | - | ------------ | - | - | ---------------- | -
| | (in thousands)              |   | Cost    |   |   | Amortization |   |   | Book
      Value |  
| |                             |   |         |   |   |              |   |   |                  |  
| | Mineral properties:         |   |         |   |   |              |   |   |                  |  
| | Balance  January 1, 2013   | $ | 160,915 |   | $ | (231         | ) | $ | 160,684          |  
| | Additions                   |   | 1,203   |   |   | -            |   |   | 1,203            |  
| | Asset acquisitions (note 5) |   | 97,996  |   |   | -            |   |   | 97,996           |  
| | Impairment (note 11)        |   | (47,099 | ) |   | -            |   |   | (47,099          | )
| | Foreign exchange            |   | (13,483 | ) |   | 15           |   |   | (13,468          | )
| | Balance  December 31, 2013 | $ | 199,532 |   | $ | (216         | ) | $ | 199,316          |  
| |                             |   |         |   |   |              |   |   |                  |  
| | Additions                   |   | 729     |   |   | -            |   |   | 729              |  
| | Asset acquisitions (note 5) |   | 14,120  |   |   | -            |   |   | 14,120           |  
| | Impairment (note 11)        |   | (1,745  | ) |   | -            |   |   | (1,745           | )
| | Foreign exchange            |   | (19,785 | ) |   | 18           |   |   | (19,767          | )
| | Balance  December 31, 2014 | $ | 192,851 |   | $ | (198         | ) | $ | 192,653          |  

Plant and Equipment - Mining

The Company has a 22.5% interest in the
McClean Lake mill located in the Athabasca Basin of Saskatchewan, Canada. A toll
milling agreement has been signed with the participants in the CLJV that
provides for the processing of the future output of the Cigar Lake mine at the
McClean Lake mill, for which the owners of the McClean Lake mill receive a toll
milling fee and other benefits. In determining the amortization rate for the
McClean Lake mill, the amount to be amortized has been adjusted to reflect
Denisons expected share of mill feed from future toll milling. In March 2014,
the first ore from the Cigar Lake mine was received at the mill. In September
2014, after being on stand-by since August 2010, milling activities were
restarted at the McClean Lake mill and uranium packaging began in October 2014.

Plant and Equipment - Services and
Other

The environmental services division of
the Company provides mine decommissioning and decommissioned site monitoring
services for third parties.

Mineral Properties

The Company has various interests in
development and exploration projects located in Canada, Mali, Namibia, Zambia
and Mongolia which are held directly or through option or various contractual
agreements.

Canada Mining Segment

The Companys mineral property
interests in Canada with significant carrying values and their locations are:

| | a) | McClean Lake (Saskatchewan)  the Company has a 22.5%
      interest in the project (includes the Sue D, Sue E, Caribou, McClean North
      and McClean South deposits);                                                  
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b) | Midwest (Saskatchewan)  the Company has a 25.17%
      interest in the project (includes the Midwest and Midwest A
    deposits);                                                                                         
| | c) | Wheeler River (Saskatchewan)  the Company has a 60%
      interest in the project (includes the Phoenix deposit);                                                                                                         
| | d) | Waterbury Lake (Saskatchewan)  the Company has a 60%
      interest in the project (includes the J Zone deposit) and also has a 2.0%
      net smelter return royalty on the portion of the project it does not
      own;
| | e) | Mann Lake (Saskatchewan)  the Company has a 30% interest
      in the project; and                                                                                                                                        
| | f) | Wolly (Saskatchewan)  the Company has a 22.5% interest
      in the project.                                                                                                                                              

In January 2013, Denison completed the
acquisition of JNR and acquired mineral property interests in Canada with a fair
value of $13,022,000 (see note 5). As a result of the JNR Arrangement, Denison
increased its interest in five projects it was already participating in to 100%
(which includes Moore Lake) and it acquired interests in nine additional
properties.

- 21 -

---

In April 2013, Denison completed the
acquisition of Fission and acquired mineral property interests in Canada,
including the J Zone deposit, with a fair value of $66,945,000 (see note 5). As
a result of the Fission Arrangement, Denison increased its interest in one
project (Johnston Lake) that it was already participating in to 100% and it
acquired interests in 27 additional properties.

In December 2013, Denison signed an
option agreement with Strateco Resources Inc. (Strateco) whereby Denison
granted Strateco the option to earn up to a 60% interest in Denisons Jasper
Lake property in two stages (the Jasper Option). During the year, the Jasper
Option was assigned to SeqUr Exploration Inc. (SeqUr). In February 2015, SeqUr
notified the Company that it intends to terminate its option to earn an interest
in the Jasper Lake property.

In December 2013, Denison received
CAD$100,000 of cash from Strateco towards the first stage of the Jasper Option
which has been reflected in other income (expense).

In December 2013, Denison recognized an
impairment charge of $934,000 to reflect the abandonment of its Riou Lake
property. Riou Lake was acquired as part of the Fission acquisition in April
2013.

In March 2014, Denison released its
land holdings related to the Black Lake property acquired as part of the
acquisition of JNR in January 2013. The Company has recognized an impairment
charge of $1,658,000 in its results to reflect the abandonment of this property.

In June 2014, Denison completed the
sale of its land holdings related to the Way Lake and Yurchison properties, also
acquired as part of the acquisition of JNR, for cash and share consideration
valued at $202,000. The sale resulted in a gain of $202,000 which has been
included in other income (expense) in the consolidated statements of operations.

In June 2014, Denison received a cash
payment of CAD$250,000 from Strateco towards the first stage of the Jasper
Option which has been reflected in other income (expense).

In June 2014, Denison completed the
acquisition of IEC and acquired mineral property interests in Canada with a fair
value of $14,120,000 (see note 5). As a result of the IEC Arrangement, Denison
acquired a 30% interest in the Mann Lake project and increased its interest in
the Bachman Lake project from 80% to 100%.

Africa Mining
Segment-Mali

In November 2013, Denison acquired
control of Rockgate and acquired mineral property interests in five projects in
Mali with a fair value of $11,996,000 (see note 5). The most significant of
these projects is the Falea project to which all of the fair value has been
allocated.

Africa Mining
Segment-Namibia

In April 2013, Denison completed the
acquisition of Fission and acquired mineral property interests in two projects
in Namibia with a fair value of $5,949,000 (see note 5). The most significant of
these projects is the Dome project to which all of the fair value has been
allocated. During 2013, the Company released its interest in one of the projects
so that only the Dome project remains at December 31, 2013.

When the Company acquired the Dome
project, it became a party to an earn-in agreement with Rio Tinto Mining and
Exploration Limited (Rio) that was entered into prior to the Companys
acquisition of Fission. Under the earn-in agreement, Rio was able to earn: a)
49% of Denisons interest in the project by incurring exploration expenditures
of $5,000,000 by September 2016 (the First Stage Earn-In); b) an additional
15% of Denisons interest in the project by spending an additional $5,000,000
within two years of completing the First Stage Earn-In (the Second Stage
Earn-In); and c) an additional 11% of Denisons interest in the project by
funding a bankable feasibility study within five years of completing the Second
Stage Earn-In. As at December 31, 2013, Rio spent approximately $1,561,000
towards the First Stage Earn-In.

In March 2014, Rio terminated its
option to earn an interest in the Dome project. Rio discontinued activities at
the project site in February 2014 and Denison has assumed operatorship of the
project. Expenditures incurred by Rio on Denisons account also had the effect
of diluting a third party with an interest in the Dome project, Manica Minerals,
below 20%. As a result of the dilution, Manica opted to accept a 10% carried
interest in the project and Denison now has a 90% interest in the project.

Africa Mining
Segment-Niger

In November 2013, Denison acquired
control of Rockgate and acquired a mineral property interest in the Telwa Gada
project in Niger with a fair value of $94,000 (see note 5).

- 22 -

---

|    | In November 2014, Denison released its land holdings
      related to the Telwa Gada property and recognized an impairment charge of
      $87,000 in its results to reflect the abandonment of this
  property.                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | At December 2014, the Company no longer has any mineral
      property interests in Niger.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | Africa Mining Segment-Zambia                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | The Company has a 100% interest in the Mutanga project
      (includes the Mutanga, Dibwe and Dibwe East deposits) located in
      Zambia.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | In 2013, in light of the implied valuations associated
      with recent market transactions involving companies with uranium projects
      in Africa and in conjunction with regular reviews of exploration and
      development plans for its projects, the Company completed an impairment
      test on its Mutanga project.                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | The Company used a fair value less costs of disposal
      analysis to determine the recoverable amount of the project as at December
      31, 2013. In determining the recoverable amount, the Company used a
      valuation technique that relied on market transactions adjusted for
      differences in deposit grade, resource size and resource quality to make
      them more comparable to the Companys Mutanga project. The application of
      the valuation technique requires managements judgment when considering
      qualitative and quantitative factors specific to the Mutanga
    project.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | Since the Mutanga projects recoverable amount was
      determined to be lower than its carrying amount, the Company has
      recognized an impairment loss of $46,165,000 in 2013 to adjust the
      projects carrying amount to its recoverable amount of ZMW 167,055,000
      (equivalent to $30,000,000 as at December 31, 2013).                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | Asia Mining Segment-Mongolia                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | The Company currently has an 85% interest in and is the
      managing partner of the Gurvan Saihan Joint Venture (GSJV) in Mongolia
      (includes the Hairhan and Haraat deposits). The other party to the GSJV is
      the Mongolian government with a 15% interest. The results of the GSJV have
      been 100% consolidated in these financial statements since the Company
      exercises control and its partner in the GSJV has a carried interest at
      this time.                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | Under the Nuclear Energy Law of Mongolia, the Mongolian
      participant in the GSJV is entitled to hold a 34% to 51% interest in the
      GSJV, depending on the amount of historic exploration that was funded by
      the government of Mongolia, to be acquired at no cost to the Mongolian
      participant. This interest will be held by Mon-Atom LLC, the Mongolian
      state owned uranium company.                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | A restructuring of the GSJV will be required to comply
      with the Nuclear Energy Law and is expected to result in the Company
      having its interest reduced to 66%. The Company and Mon-Atom continue to
      be engaged in discussions in respect of the Companys ownership of the
      GSJV. The Company is also exploring strategic alternatives for its
      interest in the GSJV.                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|12. | INTANGIBLES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | The intangibles balance consists
of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

| |                                         |   | At
      December 31 |   |   | At
      December 31 |  
| | --------------------------------------- | - | -------------------- | - | - | -------------------- | -
| | (in thousands)                          |   | 2014                 |   |   | 2013                 |  
| |                                         |   |                      |   |   |                      |  
| | Cost                                    | $ | 6,379                |   | $ | 6,957                |  
| | Accumulated
      amortization          |   | (5,741               | ) |   | (5,705               | )
| | Net book value                          | $ | 638                  |   | $ | 1,252                |  
| |                                         |   |                      |   |   |                      |  
| | Net book value-by item:                 |   |                      |   |   |                      |  
| | UPC
      management services agreement | $ | 638                  |   | $ | 1,252                |  
| | Net book value                          | $ | 638                  |   | $ | 1,252                |  

- 23 -

---

The intangibles continuity summary is
as follows:

| |                                   |   |       |   |   | Accumulated  |   |   | Net              |  
| | --------------------------------- | - | ----- | - | - | ------------ | - | - | ---------------- | -
| | (in thousands)                    |   | Cost  |   |   | Amortization |   |   | Book
      Value |  
| |                                   |   |       |   |   |              |   |   |                  |  
| | Balance  January 1, 2013         | $ | 7,438 |   | $ | (5,430       | ) | $ | 2,008            |  
| | Amortization                      |   | -     |   |   | (648         | ) |   | (648             | )
| | Foreign exchange                  |   | (481  | ) |   | 373          |   |   | (108             | )
| | Balance  December
      31, 2013 | $ | 6,957 |   | $ | (5,705       | ) | $ | 1,252            |  
| |                                   |   |       |   |   |              |   |   |                  |  
| | Amortization                      |   | -     |   |   | (536         | ) |   | (536             | )
| | Foreign exchange                  |   | (578  | ) |   | 500          |   |   | (78              | )
| | Balance  December
      31, 2014 | $ | 6,379 |   | $ | (5,741       | ) | $ | 638              |  

|    | UPC Management Services Agreement                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The intangible from the UPC management services agreement
      is associated with the acquisition of Denison Mines Inc (DMI) in 2006.
      The contract is being amortized over its estimated useful life (see note
      24).                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|13. | POST-EMPLOYMENT BENEFITS                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company provides post employment benefits for former
      Canadian employees who retired on immediate pension prior to 1997. The
      post employment benefits provided include life insurance and medical and
      dental benefits as set out in the applicable group policies but does not
      include pensions. No post employment benefits are provided to employees
      outside the employee group referenced above. The post employment benefit
      plan is not funded.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The effective date of the most recent actuarial valuation
      of the accrued benefit obligation is December 31, 2011. The amount accrued
      is based on estimates provided by the plan administrator which are based
      on past experience, limits on coverage as set out in the applicable group
      policies and assumptions about future cost trends. The significant
      assumptions used in the valuation are listed
below:                                              

| |  | Discount rate of 3.65%;                                                                                                                                          
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Medical cost trend rates at 7.00% per annum initially,
      grading down to 4.50% per annum over 20 years and remaining at 4.50% per
      annum thereafter; and
| |  | Dental cost trend rates at 4.00% per annum for the first
      ten years, 3.50% per annum for the following ten years and 3.0% per annum
      thereafter;       

The post-employment benefits balance
consists of:

| |                                                 |   | At
      December 31 |  |   | At
      December 31 | 
| | ----------------------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                                  |   | 2014                 |  |   | 2013                 | 
| |                                                 |   |                      |  |   |                      | 
| | Accrued benefit obligation                      | $ | 2,921                |  | $ | 3,321                | 
| |                                                 | $ | 2,921                |  | $ | 3,321                | 
| |                                                 |   |                      |  |   |                      | 
| | Post-employment benefits liability-by duration: |   |                      |  |   |                      | 
| | Current                                         | $ | 259                  |  | $ | 376                  | 
| | Non-current                                     |   | 2,662                |  |   | 2,945                | 
| |                                                 | $ | 2,921                |  | $ | 3,321                | 

- 24 -

---

The post-employment benefits continuity
summary is as follows:

| | (in thousands)                    |   |       |  
| | --------------------------------- | - | ----- | -
| |                                   |   |       |  
| | Balance - January 1, 2013         | $ | 3,664 |  
| | Benefits paid                     |   | (235  | )
| | Interest cost                     |   | 125   |  
| | Foreign exchange                  |   | (233  | )
| | Balance - December 31, 2013       | $ | 3,321 |  
| |                                   |   |       |  
| | Benefits paid                     |   | (244  | )
| | Interest cost                     |   | 114   |  
| | Foreign exchange                  |   | (270  | )
| | Balance - December
      31, 2014 | $ | 2,921 |  

|14. | RECLAMATION OBLIGATIONS                           
|--- | --------------------------------------------------
|    |                                                   
|    | The reclamation obligations balance consists
  of:

| |                                                      |   | At
      December 31 |  |   | At
      December 31 | 
| | ---------------------------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                                       |   | 2014                 |  |   | 2013                 | 
| |                                                      |   |                      |  |   |                      | 
| | Reclamation liability - by location:                 |   |                      |  |   |                      | 
| | Elliot Lake                                          | $ | 11,234               |  | $ | 10,008               | 
| | McClean and Midwest Joint Ventures                   |   | 6,406                |  |   | 2,200                | 
| | Other                                                |   | 19                   |  |   | -                    | 
| |                                                      | $ | 17,659               |  | $ | 12,208               | 
| |                                                      |   |                      |  |   |                      | 
| | Reclamation and remediation liability - by duration: |   |                      |  |   |                      | 
| | Current                                              | $ | 706                  |  | $ | 699                  | 
| | Non-current                                          |   | 16,953               |  |   | 11,509               | 
| |                                                      | $ | 17,659               |  | $ | 12,208               | 

The reclamation obligations continuity
summary is as follows:

| | (in thousands)                         |   |        |  
| | -------------------------------------- | - | ------ | -
| |                                        |   |        |  
| | Balance - January 1, 2013              | $ | 15,664 |  
| | Accretion                              |   | 796    |  
| | Expenditures incurred                  |   | (877   | )
| | Liability adjustments-income statement |   | (1,645 | )
| | Liability adjustments-balance sheet    |   | (755   | )
| | Foreign exchange                       |   | (975   | )
| | Balance - December 31, 2013            | $ | 12,208 |  
| |                                        |   |        |  
| | Accretion                              |   | 720    |  
| | Asset acquisition (note 5)             |   | 20     |  
| | Expenditures incurred                  |   | (593   | )
| | Future expenditures reimbursed by CLJV |   | 883    |  
| | Liability adjustments-income statement |   | 2,086  |  
| | Liability adjustments-balance sheet    |   | 3,516  |  
| | Foreign exchange                       |   | (1,181 | )
| | Balance - December
      31, 2014      | $ | 17,659 |  

Site Restoration: Elliot Lake

The Elliot Lake uranium mine was closed
in 1992 and capital works to decommission this site were completed in 1997. The
remaining provision is for the estimated cost of monitoring the Tailings
Management Areas at the Company and Stanrock sites and for treatment of water
discharged from these areas. The Company conducts its activities at both sites
pursuant to licenses issued by the Canadian Nuclear Safety Commission. The above
accrual represents the Companys best estimate of the present value of the total
future reclamation cost based on assumptions as to levels of treatment, which will be
      required in the future, discounted at 5.22% (2013: 6.13%). As at December
      31, 2014, the undiscounted amount of estimated future reclamation costs is
      $24,818,000 (CAD$28,791,000) (December 31, 2013: $26,217,000
      (CAD$27,885,000)). Revisions to the reclamation liability for Elliot Lake
      are recognized in the income statement as there is no net reclamation
      asset associated with this site.

- 25 -

---

|    | Spending on restoration activities at the Elliot Lake
      site is funded from monies in the Elliot Lake Reclamation Trust fund (see
      note 10).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Site Restoration: McClean Lake Joint Venture and
      Midwest Joint Venture                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The McClean Lake and Midwest operations are subject to
      environmental regulations as set out by the Saskatchewan government and
      the Canadian Nuclear Safety Commission. Cost estimates of the estimated
      future decommissioning and reclamation activities are prepared
      periodically and filed with the applicable regulatory authorities for
      approval. The above accrual represents the Companys best estimate of the
      present value of the future reclamation cost contemplated in these cost
      estimates discounted at 5.22% (2013: 6.13%). As at December 31, 2014, the
      undiscounted amount of estimated future reclamation costs is $17,529,000
      (CAD$20,335,000) (December 31, 2013: $9,062,000 (CAD$9,639,000)).
      Reclamation costs are expected to be incurred between 2033 and
  2058.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Under the Mineral Industry Environmental Protection
      Regulations (1996), the Company is required to provide its pro-rata share
      of financial assurances to the Province. As at December 31, 2014, the
      Company has in place irrevocable standby letters of credit, from a
      chartered bank, in favour of Saskatchewan Environment, totalling
      CAD$9,698,000 which relate to a previously filed reclamation plan. Under
      the preliminary updated plan submitted in November 2014 which is currently
      under review by the applicable regulatory authorities, the Company expects
      to increase its pro-rata share of financial assurances to the Province by
      CAD$12,748,000 to approximately CAD$22,446,000.                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Under the terms of a Potentially Reactive Waste Rock
      Disposal Agreement (PRWR Agreement) between the MLJV and the CLJV, the
      MLJV agreed to deposit certain waste rock material from the Cigar Lake
      mine in its mined-out Sue C pit. In return, the CLJV has agreed to
      reimburse the MLJV for additional site restoration costs that may
      reasonably occur as a result.                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | In 2014, triggered by the delivery of the first Cigar
      Lake mine ore to the McClean Lake mill in March 2014, the CLJV made
      payments totalling CAD$4,332,000 to the MLJV under the terms of the PRWR
      Agreement. Denison has recorded its proportionate share of this total
      amount of $883,000 (CAD$974,700) as a component of its Reclamation
      obligations.                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|15. | DEBT OBLIGATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The debt obligations balance consists
  of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

| |                                   |   | At
      December 31 |  |   | At
      December 31 | 
| | --------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                    |   | 2014                 |  |   | 2013                 | 
| |                                   |   |                      |  |   |                      | 
| |                                   |   |                      |  |   |                      | 
| | Notes payable and other financing | $ | 39                   |  | $ | 97                   | 
| |                                   | $ | 39                   |  | $ | 97                   | 
| |                                   |   |                      |  |   |                      | 
| | Debt obligations, by duration:    |   |                      |  |   |                      | 
| | Current                           | $ | 30                   |  | $ | 55                   | 
| | Non-current                       |   | 9                    |  |   | 42                   | 
| |                                   | $ | 39                   |  | $ | 97                   | 

- 26 -

---

Letters of Credit Facility

In 2014, the Company had a facility in
place with the Bank of Nova Scotia for credit of up to CAD$15,000,000 with a 1
year term and a maturity date of January 31, 2015 (the 2014 facility). Use of
the 2014 facility was restricted to non-financial letters of credit in support
of reclamation obligations.

The 2014 facility contained a covenant
to maintain a level of tangible net worth greater than or equal to the sum of
$150,000,000. As security for the 2014 facility, DMC has provided an unlimited
full recourse guarantee and a pledge of all of the shares of DMI. DMI has
provided a first-priority security interest in all present and future personal
property and an assignment of its rights and interests under all material
agreements relative to the McClean Lake and Midwest projects. The 2014 facility
is subject to letter of credit and standby fees of 2.00% and 0.75%
respectively.

At December 31, 2014, the Company has
no outstanding borrowings under the 2014 facility (December 31, 2013 - $nil). At
December 31, 2014, the Company is in compliance with its 2014 facility covenants
and CAD$9,698,000 of the 2014 facility is being utilized as collateral for
certain letters of credit (December 31, 2013 - CAD$9,698,000). During 2014 and
2013, the Company incurred letter of credit and standby fees of $221,000 and
$339,000, respectively.

On January 30, 2015, the Company
entered into an amended agreement (the 2015 facility) with the Bank of Nova
Scotia to amend the terms of the 2014 facility and extend the maturity date to
January 31, 2016 (see note 28).

Scheduled Debt Obligation Maturities

The table below represents scheduled
maturities of the Companys debt obligations over the next 2 years after which
its debt obligations will be paid in full:

| | (in thousands) |   |    | 
| | -------------- | - | -- | 
| |                |   |    | 
| | 2015           | $ | 30 | 
| | 2016           |   | 9  | 
| |                | $ | 39 | 

|16. | OTHER LIABILITIES                           
|--- | --------------------------------------------
|    |                                             
|    | The other liabilities balance consists
  of:

| |                                                        |   | At
      December 31 |  |   | At
      December 31 | 
| | ------------------------------------------------------ | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                                         |   | 2014                 |  |   | 2013                 | 
| |                                                        |   |                      |  |   |                      | 
| | Unamortized fair value of toll milling
      contracts | $ | 861                  |  | $ | 940                  | 
| | Flow-through share premium obligation                  |   | 1,915                |  |   | 324                  | 
| | Other                                                  |   | -                    |  |   | 9                    | 
| |                                                        | $ | 2,776                |  | $ | 1,273                | 
| |                                                        |   |                      |  |   |                      | 
| | Other long-term liabilities - by duration:             |   |                      |  |   |                      | 
| | Current                                                | $ | 1,935                |  | $ | 333                  | 
| | Non-current                                            |   | 841                  |  |   | 940                  | 
| |                                                        | $ | 2,776                |  | $ | 1,273                | 

Unamortized fair values of toll milling
contracts are amortized to revenue on a pro-rata basis over the estimated volume
of the applicable contract. Flow-through share premium obligations are
extinguished when the tax benefits of the related exploration expenditures are
renounced to subscribers and the tax impact is recorded in the Companys
deferred tax provision.

- 27 -

---

|17. | INCOME TAXES                                                                           
|--- | ---------------------------------------------------------------------------------------
|    |                                                                                        
|    | The income tax recovery (expense) balance from continuing
      operations consists of:

| | (in thousands)                                       |   | 2014  |   |   | 2013    |  
| | ---------------------------------------------------- | - | ----- | - | - | ------- | -
| |                                                      |   |       |   |   |         |  
| | Current income tax:                                  |   |       |   |   |         |  
| | Based on taxable income for the period               | $ | -     |   | $ | -       |  
| | Prior period (under) over provision                  |   | (5    | ) |   | 51      |  
| |                                                      |   | (5    | ) |   | 51      |  
| | Deferred income tax:                                 |   |       |   |   |         |  
| | Origination/reversal of temporary differences        |   | (972  | ) |   | 960     |  
| | Tax benefit-previously
      unrecognized tax assets |   | 3,588 |   |   | 1,729   |  
| | Change in tax rates / legislation                    |   | -     |   |   | (18,410 | )
| | Prior year (under) over provision                    |   | (312  | ) |   | 248     |  
| |                                                      |   | 2,304 |   |   | (15,473 | )
| | Income tax recovery (expense)                        | $ | 2,299 |   | $ | (15,422 | )

The Company operates in multiple
industries and jurisdictions, and the related income is subject to varying rates
of taxation. The combined Canadian tax rate reflects the federal and provincial
tax rates in effect in Ontario, Canada for each applicable year. A
reconciliation of the combined Canadian tax rate to the Companys effective rate
of income tax is as follows:

| | (in thousands)                                       |   | 2014    |   |   | 2013    |  
| | ---------------------------------------------------- | - | ------- | - | - | ------- | -
| |                                                      |   |         |   |   |         |  
| | Income (loss) before taxes                           | $ | (34,002 | ) | $ | (68,413 | )
| | Combined Canadian
      tax rate                     |   | 26.50%  |   |   | 26.50%  |  
| | Income tax recovery (expense) at combined
      rate |   | 9,010   |   |   | 18,129  |  
| | Difference in foreign tax rates                      |   | (513    | ) |   | 2,912   |  
| | Non-deductible amounts                               |   | (3,323  | ) |   | (15,810 | )
| | Non-taxable amounts                                  |   | 2,451   |   |   | 1,538   |  
| | Previously unrecognized future tax assets
      (1)  |   | 3,588   |   |   | 1,729   |  
| | Renunciation of tax attributes-flow through shares   |   | (1,071  | ) |   | (1,101  | )
| | Change in deferred tax assets not
      recognized   |   | (1,711  | ) |   | (9,334  | )
| | Change in tax rates / legislation (2)                |   | -       |   |   | (18,410 | )
| | Prior year (under) over provision                    |   | (317    | ) |   | 299     |  
| | Other                                                |   | (5,815  | ) |   | 4,626   |  
| | Income tax recovery (expense)                        | $ | 2,299   |   | $ | (15,422 | )

| | (1) | The Company has recognized certain previously
      unrecognized Canadian tax assets in 2014 and 2013 as a result of the
      renunciation of certain tax benefits to subscribers pursuant to its May
      2013 CAD$14,950,000 and October 2012 CAD$7,005,000 flow-through share
      offerings; and                                                                                                                                                                                                                                                                                                                                   
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | In December 2013, a new uranium mining royalty system
      became substantively enacted in the province of Saskatchewan, Canada. The
      Company has concluded that a component of the new royalty system
      constitutes an income-based tax and is within the scope of IAS 12. The tax
      basis available to the Company under the new system is significantly less
      than the carrying value associated with the assets that will be subject to
      the royalty in future years. Accordingly, a deferred tax liability has
      been recorded by way of a corresponding charge to deferred tax expense in
      Q4-2013.

- 28 -

---

The deferred income tax assets
(liabilities) balance reported on the balance sheet is comprised of the
temporary differences as presented below:

| |                                                    |   | At
      December 31 |   |   | At
      December 31 |  
| | -------------------------------------------------- | - | -------------------- | - | - | -------------------- | -
| | (in thousands)                                     |   | 2014                 |   |   | 2013                 |  
| |                                                    |   |                      |   |   |                      |  
| | Deferred income tax assets:                        |   |                      |   |   |                      |  
| | Property, plant and equipment, net                 | $ | 1,865                |   | $ | 636                  |  
| | Post-employment benefits                           |   | 767                  |   |   | 887                  |  
| | Reclamation and remediation obligations            |   | 5,102                |   |   | 3,392                |  
| | Other long-term liabilities                        |   | 226                  |   |   | 249                  |  
| | Tax loss carry forwards                            |   | 8,875                |   |   | 8,061                |  
| | Other                                              |   | 5,295                |   |   | 5,531                |  
| | Deferred income tax assets-gross                   |   | 22,130               |   |   | 18,756               |  
| | Set-off against deferred income tax liabilities    |   | (22,130              | ) |   | (18,756              | )
| | Deferred income
      tax assets-per balance sheet | $ | -                    |   | $ | -                    |  
| |                                                    |   |                      |   |   |                      |  
| | Deferred income tax liabilities:                   |   |                      |   |   |                      |  
| | Inventory                                          | $ | (620                 | ) | $ | (696                 | )
| | Property, plant and equipment, net                 |   | (40,591              | ) |   | (42,237              | )
| | Intangibles                                        |   | (167                 | ) |   | (331                 | )
| | Other                                              |   | (2,578               | ) |   | (1,339               | )
| | Deferred income tax liabilities-gross              |   | (43,956              | ) |   | (44,603              | )
| | Set-off of
      deferred income tax assets        |   | 22,130               |   |   | 18,756               |  
| | Deferred income tax liabilities-per balance sheet  | $ | (21,826              | ) | $ | (25,847              | )

The deferred income tax liability
continuity summary is as follows:

| | (in thousands)                                              |   |         |  
| | ----------------------------------------------------------- | - | ------- | -
| |                                                             |   |         |  
| | Balance - January 1, 2013                                   | $ | (9,443  | )
| | Recognized in income (loss)                                 |   | (15,473 | )
| | Recognized in other liabilities
      (flow-through shares) |   | (1,727  | )
| | Recognized in equity (warrant expiries)                     |   | (2      | )
| | Other, including foreign exchange gain (loss)               |   | 798     |  
| | Balance - December
      31, 2013                           | $ | (25,847 | )
| |                                                             |   |         |  
| | Recognized in income (loss)                                 |   | 2,304   |  
| | Recognized in other liabilities
      (flow-through shares) |   | (313    | )
| | Other, including
      foreign exchange gain (loss)         |   | 2,030   |  
| | Balance - December 31, 2014                                 | $ | (21,826 | )

Management believes that it is not
probable that sufficient taxable profit will be available in future years to
allow the benefit of the following deferred tax assets to be utilized:

| |                                           |   | At
      December 31 |  |   | At
      December 31 | 
| | ----------------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                            |   | 2014                 |  |   | 2013                 | 
| |                                           |   |                      |  |   |                      | 
| | Deferred income tax assets not recognized |   |                      |  |   |                      | 
| | Investments                               | $ | 64                   |  | $ | 118                  | 
| | Property, plant and equipment             |   | 18,317               |  |   | 26,750               | 
| | Tax losses  capital                      |   | 26,895               |  |   | 29,141               | 
| | Tax losses  operating                    |   | 22,650               |  |   | 27,903               | 
| | Tax credits                               |   | 983                  |  |   | 1,131                | 
| | Other deductible temporary differences    |   | 2,922                |  |   | 2,852                | 
| | Deferred income tax assets not recognized | $ | 71,831               |  | $ | 87,895               | 

- 29 -

---

A geographic split of the Companys tax
losses and tax credits not recognized and the associated expiry dates of those
losses and credits is as follows:

| |                                                | Expiry    |   | At
      December 31 |   |   | At
      December 31 |  
| | ---------------------------------------------- | --------- | - | -------------------- | - | - | -------------------- | -
| | (in thousands)                                 | Date      |   | 2014                 |   |   | 2013                 |  
| |                                                |           |   |                      |   |   |                      |  
| | Tax losses - gross                             |           |   |                      |   |   |                      |  
| | Canada                                         | 2025-2034 | $ | 115,088              |   | $ | 116,113              |  
| | Mongolia                                       | 2018-2022 |   | 4,296                |   |   | 4,547                |  
| | Zambia (1)                                     |           |   | -                    |   |   | 12,284               |  
| | Other                                          | Unlimited |   | 12                   |   |   | 378                  |  
| | Tax losses - gross                             |           |   | 119,396              |   |   | 133,322              |  
| | Tax benefit at tax rate of 25% - 37.5%         |           |   | 31,525               |   |   | 35,964               |  
| | Set-off against
      deferred tax liabilities |           |   | (8,875               | ) |   | (8,061               | )
| | Total tax loss assets not recognized           |           | $ | 22,650               |   | $ | 27,903               |  
| |                                                |           |   |                      |   |   |                      |  
| | Tax credits                                    |           |   |                      |   |   |                      |  
| | Canada                                         | 2025-2034 |   | 983                  |   |   | 1,131                |  
| | Total tax credit assets not recognized         |           | $ | 983                  |   | $ | 1,131                |  

| | (1) | In December 2014, the Zambian government passed into law
      amendments to the Income Tax and Mine and Minerals Development Act which
      have the effect of eliminating corporate tax on profits from certain
      mining activities effective January 1, 2015. For the Company, the
      amendments reduce the corporate tax rate to 0% but increase the mineral
      royalty rate from 6% for all mining methods to 8% for underground mining
      and 20% for open pit mining. As a result of these amendments, the Company
      is no longer subject to income tax in Zambia and any tax attributes
      accumulated prior to December 31, 2014 have effectively expired or been
      reduced to nil.;
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|18. | SHARE CAPITAL                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                
|    | Denison is authorized to issue an unlimited number of
      common shares without par value. A continuity summary of the issued and
      outstanding common shares and the associated dollar amounts is presented
      below:

| |                                                                 |  | Number
      of |  |   |           |  
| | --------------------------------------------------------------- |  | --------------- |  | - | --------- | -
| |                                                                 |  | Common          |  |   |           |  
| | (in thousands
      except share amounts)                       |  | Shares          |  |   |           |  
| |                                                                 |  |                 |  |   |           |  
| | Balance at January 1, 2013                                      |  | 388,805,915     |  | $ | 979,124   |  
| | Issued for cash:                                                |  |                 |  |   |           |  
| | New issue
      gross proceeds                                  |  | 11,500,000      |  |   | 14,382    |  
| | New issue gross issue
      costs                               |  | -               |  |   | (755      | )
| | Share
      options exercised                                   |  | 134,972         |  |   | 111       |  
| | Share purchase warrants
      exercised                         |  | 402,129         |  |   | 330       |  
| | Acquisition of JNR (note 5)                                     |  | 7,975,479       |  |   | 10,956    |  
| | Acquisition of Fission (note 5)                                 |  | 53,053,284      |  |   | 66,259    |  
| | Acquisition of Rockgate (note 5)                                |  | 20,131,665      |  |   | 21,760    |  
| | Share options exercised-fair value adjustment                   |  | -               |  |   | 98        |  
| | Share purchase warrants
      exercised-fair value adjustment   |  | -               |  |   | 211       |  
| | Flow-through
      share premium liability                      |  | -               |  |   | (332      | )
| |                                                                 |  | 93,197,529      |  |   | 113,020   |  
| | Balance at
      December 31, 2013                              |  | 482,003,444     |  | $ | 1,092,144 |  
| |                                                                 |  |                 |  |   |           |  
| | Issued for cash:                                                |  |                 |  |   |           |  
| | New issue
      gross proceeds                                  |  | 9,257,500       |  |   | 13,704    |  
| | New issue gross issue
      costs                               |  | -               |  |   | (859      | )
| | Share
      options exercised                                   |  | 1,025,449       |  |   | 946       |  
| | Share purchase warrants
      exercised                         |  | 536,050         |  |   | 405       |  
| | Acquisition of Rockgate (note 5)                                |  | 2,312,622       |  |   | 3,034     |  
| | Acquisition of IEC (note 5)                                     |  | 10,229,035      |  |   | 11,979    |  
| | Settlement of liabilities associated
      with IEC Arrangement |  | 504,794         |  |   | 610       |  
| | Share options exercised-fair value adjustment                   |  | -               |  |   | 525       |  
| | Share purchase warrants
      exercised-fair value adjustment   |  | -               |  |   | 300       |  
| | Flow-through
      share premium liability                      |  | -               |  |   | (2,030    | )
| |                                                                 |  | 23,865,450      |  |   | 28,614    |  
| | Balance at
      December 31, 2014                              |  | 505,868,894     |  | $ | 1,120,758 |  

- 30 -

---

New Issues

In May 2013, the Company completed a
private placement of 11,500,000 flow-through common shares at a price of
CAD$1.30 per share for gross proceeds of $14,382,000 (CAD$14,950,000). The
related flow-through share premium liability was included as a component of
other liabilities on the balance sheet at December 31, 2013 and was extinguished
during 2014.

In August 2014, the Company completed a
private placement of 9,257,500 flow-through common shares at a price of CAD$1.62
per share for gross proceeds of $13,704,000 (CAD$14,997,000). The income tax
benefits of this issue will be renounced to subscribers with an effective date
of December 31, 2014. The related flow-through share premium liability is
included as a component of other liabilities at December 31, 2014.

Acquisition Related Issues

In January 2013, the Company issued
7,975,479 shares at a value of $10,956,000 (CAD$10,926,000) as part of the
acquisition of JNR (see note 5).

In April 2013, the Company issued
53,053,284 shares at a value of $66,259,000 (CAD$67,378,000) as part of the
acquisition of Fission (see note 5).

In November and early December 2013,
the Company issued 20,131,665 shares at a value of $21,760,000 (CAD$22,800,000)
as part of the acquisition of a controlling interest in Rockgate. In January
2014, the Company issued 2,312,622 shares at a value of $3,034,000
(CAD$3,330,000) to acquire the remaining non-controlling interest in Rockgate
(see note 5).

In June 2014, the Company issued
10,229,035 shares at a value of $11,979,000 (CAD$13,093,000) as part of the
acquisition of IEC (see note 5).

Flow-Through Share Issues

The Company finances a portion of its
exploration programs through the use of flow-through share issuances. Canadian
income tax deductions relating to these expenditures are claimable by the
investors and not by the Company.

As at December 31, 2014, the Company
estimates that it has satisfied its obligation to spend CAD$14,950,000 on
eligible exploration expenditures as a result of the issuance of flow through
shares in May 2013. The Company renounced the income tax benefits of this issue
to its subscribers in February 2014. In conjunction with the renunciation, the
flow-through share premium liability has been reversed and recognized as part of
the deferred tax recovery (see note 17).

As at December 31, 2014, the Company
estimates that it has incurred CAD$1,222,000 of its obligation to spend
CAD$14,997,000 on eligible exploration expenditures as a result of the issuance
of flow through shares in August 2014. The Company renounced the income tax
benefits of this issue to its subscribers in February 2015.

- 31 -

---

|19. | SHARE PURCHASE WARRANTS                                                                                                                                                              
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                      
|    | A continuity summary of the issued and outstanding share
      purchase warrants in terms of common shares of the Company and the
      associated dollar amounts is presented below:

| |                                                      |   | Weighted     |  |  |           |   |   |        |  
| | ---------------------------------------------------- | - | ------------ |  |  | --------- | - | - | ------ | -
| |                                                      |   | Average      |  |  | Number of |   |   |        |  
| |                                                      |   | Exercise     |  |  | Common    |   |   | Fair   |  
| |                                                      |   | Price Per    |  |  | Shares    |   |   | Value  |  
| | (in thousands
      except share amounts)            |   | Share (CAD$) |  |  | Issuable  |   |   | Amount |  
| |                                                      |   |              |  |  |           |   |   |        |  
| | Balance outstanding at January 1, 2013               | $ | -            |  |  | -         |   | $ | -      |  
| |                                                      |   |              |  |  |           |   |   |        |  
| | Warrants issued on acquisition of JNR (note
      5) |   | 2.05         |  |  | 272,290   |   |   | 17     |  
| | Warrants assumed on acquisition of Fission (note 5)  |   | 0.84         |  |  | 1,500,854 |   |   | 827    |  
| | Warrants exercised                                   |   | 0.85         |  |  | (402,129  | ) |   | (211   | )
| | Warrants expired                                     |   | 2.05         |  |  | (272,290  | ) |   | (17    | )
| | Balance outstanding at December 31, 2013             | $ | 0.84         |  |  | 1,098,725 |   | $ | 616    |  
| |                                                      |   |              |  |  |           |   |   |        |  
| | Warrants issued on acquisition of IEC (note
      5) |   | 1.71         |  |  | 660,127   |   |   | 61     |  
| | Warrants exercised                                   |   | 0.84         |  |  | (536,050  | ) |   | (300   | )
| | Warrants expired                                     |   | 2.31         |  |  | (143,000  | ) |   | (1     | )
| | Balance
      outstanding at December 31, 2014       | $ | 1.17         |  |  | 1,079,802 |   | $ | 376    |  
| |                                                      |   |              |  |  |           |   |   |        |  
| | Balance of common shares issuable by warrant series: |   |              |  |  |           |   |   |        |  
| | Fission January
      2013 series (1)                | $ | 0.84         |  |  | 562,675   |   | $ | 316    |  
| | IEC December 2013 series
      (2)                   |   | 1.54         |  |  | 329,061   |   |   | 36     |  
| | IEC February 2014 series
      (3)                   |   | 1.54         |  |  | 188,066   |   |   | 24     |  
| | Balance
      outstanding at December 31, 2014       | $ | 1.17         |  |  | 1,079,802 |   | $ | 376    |  

| | (1) | The Fission January 2013 series has an effective exercise
      price of CAD$0.84 per issuable share and expires on January 21,
    2015.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------
| | (2) | The IEC December 2013 series has an effective exercise
      price of CAD$1.54 per issuable share and expires on June 5,
2015.           
| | (3) | The IEC February 2014 series has an effective exercise
      price of CAD$1.54 per issuable share and expires on August 20,
  2015.      

|20. | STOCK OPTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | The Companys stock-based compensation plan (the Plan)
      provides for the granting of stock options up to 10% of the issued and
      outstanding common shares at the time of grant, subject to a maximum of
      39,670,000 common shares. As at December 31, 2014, an aggregate of
      12,160,800 options have been granted (less cancellations) since the Plans
      inception in 1997.                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | Under the Plan, all stock options are granted at the
      discretion of the Companys board of directors, including any vesting
      provisions if applicable. The term of any stock option granted may not
      exceed ten years and the exercise price may not be lower than the closing
      price of the Companys shares on the last trading day immediately
      preceding the date of grant. In general, stock options granted under the
      Plan have five year terms and vesting periods up to thirty
  months.

- 32 -

---

A continuity summary of the stock
options of the Company granted under the Plan is presented below:

| |                                                       |  |            |   |   | Weighted- | 
| | ----------------------------------------------------- |  | ---------- | - | - | --------- | 
| |                                                       |  |            |   |   | Average   | 
| |                                                       |  |            |   |   | Exercise  | 
| |                                                       |  | Number of  |   |   | Price per | 
| |                                                       |  | Common     |   |   | Share     | 
| |                                                       |  | Shares     |   |   | (CAD$)    | 
| |                                                       |  |            |   |   |           | 
| | Stock options outstanding - beginning of
      period |  | 8,431,138  |   | $ | 1.91      | 
| | Issued on acquisition of IEC (note 5)                 |  | 902,200    |   |   | 1.48      | 
| | Granted                                               |  | 1,311,000  |   |   | 1.81      | 
| | Exercised (1)                                         |  | (1,025,449 | ) |   | 1.00      | 
| | Forfeitures                                           |  | (327,239   | ) |   | 2.93      | 
| | Expiries                                              |  | (3,112,076 | ) |   | 2.16      | 
| | Stock options outstanding - end of period             |  | 6,179,574  |   | $ | 1.80      | 
| | Stock options
      exercisable - end of period       |  | 4,370,074  |   | $ | 1.86      | 

| | (1) | The weighted average share price at the date of exercise
      was CAD$1.51.
| | --- | ----------------------------------------------------------------------------

A summary of the Companys stock
options outstanding at December 31, 2014 is presented below:

| |                                           |  | Weighted    |  |  |           |  |   | Weighted- | 
| | ----------------------------------------- |  | ----------- |  |  | --------- |  | - | --------- | 
| |                                           |  | Average     |  |  |           |  |   | Average   | 
| |                                           |  | Remaining   |  |  |           |  |   | Exercise  | 
| | Range of Exercise                         |  | Contractual |  |  | Number of |  |   | Price per | 
| | Prices per Share                          |  | Life        |  |  | Common    |  |   | Share     | 
| | (CAD$)                                    |  | (Years)     |  |  | Shares    |  |   | (CAD$)    | 
| |                                           |  |             |  |  |           |  |   |           | 
| | Stock options outstanding                 |  |             |  |  |           |  |   |           | 
| | $ 0.38 to $ 2.49                          |  | 2.73        |  |  | 5,074,433 |  | $ | 1.40      | 
| | $ 2.50 to $ 4.99                          |  | 1.08        |  |  | 853,181   |  |   | 3.23      | 
| | $ 5.00 to $ 5.67                          |  | 1.38        |  |  | 251,960   |  |   | 5.02      | 
| | Stock options outstanding - end of period |  | 2.45        |  |  | 6,179,574 |  | $ | 1.80      | 

Options outstanding at December 31,
2014 expire between February 2015 and May 2019.

The fair value of each option granted
is estimated on the date of grant using the Black-Scholes option pricing model.
The following table outlines the range of assumptions used in the model to
determine the fair value of options granted (excluding those granted pursuant to
the JNR, Fission and IEC acquisitions  refer to note 5):

| |                                                  | 2014                | 2013     
| | ------------------------------------------------ | ------------------- | ---------
| |                                                  |                     |          
| | Risk-free interest rate                          | 1.42% - 1.47%       | 1.29%    
| | Expected stock price volatility                  | 55.21% - 55.56%     | 60.2%    
| | Expected life                                    | 3.7 years           | 3.6 years
| | Estimated forfeiture rate                        | 3.50% - 3.70%       | 4.6%     
| | Expected dividend yield                          |                    |         
| | Fair
      value per share under options granted | CAD$0.54  CAD$0.74 | CAD$0.58 

The fair values of stock options with
vesting provisions are amortized on a graded method basis as stock-based
compensation expense over the applicable vesting periods. Included in the
statement of income (loss) is stock-based compensation of $800,000 for 2014 and
$903,000 for 2013. At December 31, 2014, the Company had an additional $338,000
in stock-based compensation expense to be recognized periodically to May 2016.

- 33 -

---

|21. | ACCUMULATED OTHER COMPREHENSIVE INCOME                               
|--- | ---------------------------------------------------------------------
|    |                                                                      
|    | The accumulated other comprehensive income balance
      consists of:

| |                                                         |   | At
      December 31 |   |   | At
      December 31 |  
| | ------------------------------------------------------- | - | -------------------- | - | - | -------------------- | -
| | (in thousands)                                          |   | 2014                 |   |   | 2013                 |  
| |                                                         |   |                      |   |   |                      |  
| |                                                         |   |                      |   |   |                      |  
| | Cumulative foreign currency translation                 | $ | (26,017              | ) | $ | (7,880               | )
| | Unamortized experience gain  post employment liability |   |                      |   |   |                      |  
| | Gross                                                   |   | 206                  |   |   | 206                  |  
| | Tax effect                                              |   | (56                  | ) |   | (56                  | )
| | Unrealized gains (losses) on investments                |   |                      |   |   |                      |  
| | Gross                                                   |   | 8                    |   |   | 1                    |  
| |                                                         | $ | (25,859              | ) | $ | (7,729               | )

|22. | SUPPLEMENTAL FINANCIAL INFORMATION                      
|--- | --------------------------------------------------------
|    |                                                         
|    | The components of operating expenses are as
    follows:

| |                                             |   | Year Ended  |  
| | ------------------------------------------- | - | ----------- | -
| |                                             |   | December 31 |  
| | (in thousands)                              |   | 2014        |  
| |                                             |   |             |  
| | Cost of goods and services sold:            |   |             |  
| | Operating Overheads:                        |   |             |  
| | Mining, other development expense           | $ | (2,587      | )
| | Milling,
      conversion expense           |   | (466        | )
| | Mill feed cost:                             |   |             |  
| | -Stockpile depletion                        |   | (61         | )
| | Less absorption:                            |   |             |  
| | -Stockpiles, mineral properties             |   | 736         |  
| | -Concentrates                               |   | 440         |  
| | Cost
      of services                      |   | (7,612      | )
| | Cost of goods and services sold             |   | (9,550      | )
| | Reclamation asset amortization              |   | (15         | )
| | Reclamation liability adjustments (note 14) |   | (2,086      | )
| | Operating expenses                          | $ | (11,651     | )

The components of other income
(expense) are as follows:

| |                                                               |   | Year Ended  |  
| | ------------------------------------------------------------- | - | ----------- | -
| |                                                               |   | December 31 |  
| | (in thousands)                                                |   | 2014        |  
| |                                                               |   |             |  
| | Gains (losses) on:                                            |   |             |  
| | Foreign exchange                                              | $ | (7,983      | )
| | Disposal of property, plant
      and equipment               |   | 449         |  
| | Investment impairments                                        |   | (22         | )
| | Investment disposals / fair
      value through profit (loss) |   | (59         | )
| | Other                                                         |   | 57          |  
| | Other income (expense)                                        | $ | (7,558      | )

- 34 -

---

The components of finance income
(expense) are as follows:

| |                                                  |   | Year Ended  |  
| | ------------------------------------------------ | - | ----------- | -
| |                                                  |   | December 31 |  
| | (in thousands)                                   |   | 2014        |  
| |                                                  |   |             |  
| | Interest income                                  | $ | 554         |  
| | Interest expense                                 |   | (2          | )
| | Accretion expense-reclamation obligations        |   | (720        | )
| | Accretion
      expense-post-employment benefits |   | (114        | )
| | Finance income (expense)                         | $ | (282        | )

A summary of depreciation expense
recognized in the statement of income (loss) is as follows:

| |                                   |   | Year Ended  |  
| | --------------------------------- | - | ----------- | -
| |                                   |   | December 31 |  
| | (in thousands)                    |   | 2014        |  
| |                                   |   |             |  
| | Operating expenses:               |   |             |  
| | Mining, other development expense | $ | (303        | )
| | Milling, conversion expense       |   | (79         | )
| | Cost of services                  |   | (244        | )
| | Mineral property exploration      |   | (125        | )
| | General and
      administrative  |   | (66         | )
| | Depreciation expense - gross      | $ | (817        | )

A summary of employee benefits expense
recognized in the statement of income (loss) is as follows:

| |                                           |   | Year Ended  |  
| | ----------------------------------------- | - | ----------- | -
| |                                           |   | December 31 |  
| | (in thousands)                            |   | 2014        |  
| |                                           |   |             |  
| | Salaries and short-term employee benefits | $ | (8,289      | )
| | Share-based compensation                  |   | (800        | )
| | Termination benefits                      |   | (360        | )
| | Employee benefits
      expense           | $ | (9,449      | )

The change in non-cash working capital
items in the consolidated statements of cash flows is as follows:

| |                                           |   | Year Ended  |  
| | ----------------------------------------- | - | ----------- | -
| |                                           |   | December 31 |  
| | (in thousands)                            |   | 2014        |  
| |                                           |   |             |  
| | Change in non-cash working capital items: |   |             |  
| | Trade and other receivables               | $ | (5,310      | )
| | Inventories                               |   | (520        | )
| | Prepaid expenses and other assets         |   | (152        | )
| | Accounts payable and accrued liabilities  |   | 2,102       |  
| | Post-employment benefits                  |   | (244        | )
| | Reclamation
      obligations             |   | 290         |  
| | Change in non-cash working capital items  | $ | (3,834      | )

- 35 -

---

|23. | SEGMENTED INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | Business Segments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | The Company operates in two primary segments  the Mining
      segment and the Services and Other segment. The Mining segment, which has
      been further subdivided into geographic regions, includes activities
      related to exploration, evaluation and development, mining, milling
      (including toll milling) and the sale of mineral concentrates. The
      Services and Other segment includes the results of the Companys
      environmental services business, management fees and commission income
      earned from UPC and other customers and general corporate expenses not
      allocated to the other segments.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | For the year ended December 31, 2014, reportable segment
      results were as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

Canada
    
    
    Asia
    
    
    Africa
    
    
    Services(in
      thousands)
    
    Mining
    
    
    Mining
    
    
    Mining
    
    
    and
      Other
    
    
    TotalStatement of
      Operations:Revenues
    
    111
    
    
    -
    
    
    -
    
    
    9,508
    
    
    9,619Expenses:Operating expenses
    
    (2,649
    )
    
    -
    
    
    (1,390
    )
    
    (7,612
    )
    
    (11,651
    )Mineral property exploration
    
    (13,488
    )
    
    (394
    )
    
    (913
    )
    
    -
    
    
    (14,795
    )General and administrative
    
    (10
    )
    
    (858
    )
    
    (1,152
    )
    
    (5,570
    )
    
    (7,590
    )Impairment-mineral properties (note 11)
    
    (1,658
    )
    
    -
    
    
    (87
    )
    
    -
    
    
    (1,745
    )(17,805
    )
    
    (1,252
    )
    
    (3,542
    )
    
    (13,182
    )
    
    (35,781
    )Segment income (loss)
    
    (17,694
    )
    
    (1,252
    )
    
    (3,542
    )
    
    (3,674
    )
    
    (26,162
    )Revenues  supplemental:Environmental services
    
    -
    
    
    -
    
    
    -
    
    
    7,327
    
    
    7,327Management fees and commissions
    
    -
    
    
    -
    
    
    -
    
    
    2,181
    
    
    2,181Toll milling services
    
    111
    
    
    -
    
    
    -
    
    
    -
    
    
    111111
    
    
    -
    
    
    -
    
    
    9,508
    
    
    9,619Capital additions:Property, plant and equipment
    
    207
    
    
    105
    
    
    557
    
    
    100
    
    
    969Long-lived assets:Plant and equipmentCost
    
    83,613
    
    
    340
    
    
    2,288
    
    
    3,699
    
    
    89,940Accumulated depreciation
    
    (8,326
    )
    
    (231
    )
    
    (1,738
    )
    
    (1,910
    )
    
    (12,205
    )Mineral properties
    
    144,409
    
    
    6,305
    
    
    41,939
    
    
    -
    
    
    192,653Intangibles
    
    -
    
    
    -
    
    
    -
    
    
    638
    
    
    638219,696
    
    
    6,414
    
    
    42,489
    
    
    2,427
    
    
    271,026


- 36 -

---

For the year ended December 31, 2013,
reportable segment results were as follows:

Canada
    
    
    Asia
    
    
    Africa
    
    
    Services(in
      thousands)
    
    Mining
    
    
    Mining
    
    
    Mining
    
    
    and
      Other
    
    
    TotalStatement of Operations:Revenues
    
    -
    
    
    -
    
    
    -
    
    
    10,407
    
    
    10,407Expenses:Operating expenses
    
    649
    
    
    -
    
    
    (648
    )
    
    (8,812
    )
    
    (8,811
    )Mineral property exploration
    
    (12,019
    )
    
    (550
    )
    
    (1,113
    )
    
    -
    
    
    (13,682
    )General and administrative
    
    (5
    )
    
    (788
    )
    
    (1,022
    )
    
    (6,352
    )
    
    (8,167
    )Impairment-mineral properties (note 11)
    
    (934
    )
    
    -
    
    
    (46,165
    )
    
    -
    
    
    (47,099
    )(12,309
    )
    
    (1,338
    )
    
    (48,948
    )
    
    (15,164
    )
    
    (77,759
    )Segment income (loss)
    
    (12,309
    )
    
    (1,338
    )
    
    (48,948
    )
    
    (4,757
    )
    
    (67,352
    )Revenues 
      supplemental:Environmental services
    
    -
    
    
    -
    
    
    -
    
    
    8,763
    
    
    8,763Management fees and commissions
    
    -
    
    
    -
    
    
    -
    
    
    1,644
    
    
    1,644-
    
    
    -
    
    
    -
    
    
    10,407
    
    
    10,407Capital additions:Property, plant and equipment
    
    1,188
    
    
    114
    
    
    1,010
    
    
    83
    
    
    2,395Long-lived assets:Plant and equipmentCost
    
    87,328
    
    
    396
    
    
    2,613
    
    
    3,984
    
    
    94,321Accumulated depreciation
    
    (8,792
    )
    
    (253
    )
    
    (1,726
    )
    
    (1,856
    )
    
    (12,627
    )Mineral properties
    
    144,649
    
    
    7,229
    
    
    47,438
    
    
    -
    
    
    199,316Intangibles
    
    -
    
    
    -
    
    
    -
    
    
    1,252
    
    
    1,252223,185
    
    
    7,372
    
    
    48,325
    
    
    3,380
    
    
    282,262


Revenue Concentration

The Companys business from continuing
operations is such that, at any given time, it sells its environmental and other
services to a relatively small number of customers. During 2014, three customers
from the services and other segment accounted for approximately 86% of total
revenues consisting of 53%, 23% and 10% individually. During 2013, four
customers from the services and other segment accounted for approximately 87% of
total revenues consisting of 50%, 16%, 11% and 10% individually.

- 37 -

---

|24. | RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Uranium Participation Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The Company is a party to a management services agreement
      with UPC. The most recent agreement was entered into on April 1, 2013 and
      it has a three year term that may be terminated by either party upon the
      provision of 120 days written notice. Under the terms of the agreement,
      the Company receives the following fees from UPC: a) a commission of 1.5%
      of the gross value of any purchases or sales of uranium completed at the
      request of the Board of Directors of UPC; b) a minimum annual management
      fee of CAD$400,000 (plus reasonable out-of-pocket expenses) plus an
      additional fee of 0.3% per annum based upon UPCs net asset value in
      excess of CAD$100,000,000; and c) a fee, at the discretion of the Board,
      for on-going monitoring or work associated with a transaction or
      arrangement (other than a financing, or the purchase or sale of
      uranium).
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | The following transactions were incurred with UPC for the
      periods noted:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

| |                 |   | Year Ended  | 
| | --------------- | - | ----------- | 
| |                 |   | December 31 | 
| | (in thousands)  |   | 2014        | 
| |                 |   |             | 
| | Revenue:        |   |             | 
| | Management fees | $ | 1,628       | 
| | Commission fees |   | 553         | 
| |                 | $ | 2,181       | 

At December 31, 2014, accounts
receivable includes $123,000 (December 31, 2013: $148,000) due from UPC with
respect to the fees and transactions indicated above.

Korea Electric Power Corporation
(KEPCO)

In June 2009, Denison completed
definitive agreements with KEPCO including a long-term offtake agreement (which
has been assigned to Energy Fuels Inc. (EFR) as part of the U.S. Mining
Division transaction completed in June 2012) and a strategic relationship
agreement. Pursuant to the strategic relationship agreement, KEPCO is entitled
to subscribe for additional common shares in Denisons future share offerings.
The strategic relationship agreement also provides KEPCO with a right of first
opportunity if Denison intends to sell any of its substantial assets, a right to
participate in certain purchases of substantial assets which Denison proposes to
acquire and a right to nominate one director to Denisons board so long as its
share interest in Denison is above 5.0% .

As at December 31, 2014, KEPCO holds
58,284,000 shares of Denison representing a share interest of approximately
11.5% .

Denison also holds a 60% interest in
the Waterbury Lake Uranium Corporation (WLUC) and Waterbury Lake Uranium
Limited Partnership (WLULP) entities whose key asset is the Waterbury Lake
property. The other 40% interest in these entities is held by a consortium of
investors (KWULP) of which KEPCO is the primary holder (see note 27). When a
spending program is approved by the participants, each participant is required
to fund these entities based upon its respective ownership interest. Spending
program approval requires 75% of the voting interest.

In January 2014, Denison agreed to
allow KWULP to defer its funding obligations to WLUC and WLULP until September
30, 2015 in exchange for allowing Denison to carry out spending programs without
obtaining the approval of 75% of the voting interest. As at December 31, 2014,
KWULP has a funding obligation to WLUC and WLULP of CAD$802,000. Denison has
recorded its proportionate share of this amount of $415,000 (CAD$481,000) as a
component of trade and other receivables.

Other

During 2014, the Company incurred
investor relations, administrative service fees and other expenses of $60,000
(2013: $188,000) with Namdo Management Services Ltd, which shares a common
officer with Denison. These services were incurred in the normal course of
operating a public company. At December 31, 2014, an amount of $nil (December
31, 2013: $nil) was due to this company.

During 2014, the Company incurred legal
fees of $276,000 (2013: $1,634,000) with Cassels Brock & Blackwell, LLP, a
law firm of which a member of Denisons Board of Directors is a partner. These
services and associated costs were mainly related to various acquisition and
internal re-organization activities done by the Company. At December 31, 2014,
an amount of $1,000 (December 31, 2013: $82,000) is due to this legal firm.

- 38 -

---

During 2014, the Company provided
executive services of $106,000 (2013: $nil) to Lundin Gold Inc., which shares
common directors and officers with Denison. At December 31, 2014, an amount of
$44,000 (December 31, 2013: $nil) is due from this company.

Compensation of Key Management
Personnel

Key management personnel are those
persons having authority and responsibility for planning, directing and
controlling the activities of the Company, directly or indirectly. Key
management personnel includes the Companys executive officers, vice-presidents
and members of its Board of Directors.

The following compensation was awarded
to key management personnel:

| |                                             |   | Year Ended  | 
| | ------------------------------------------- | - | ----------- | 
| |                                             |   | December 31 | 
| | (in thousands)                              |   | 2014        | 
| |                                             |   |             | 
| | Salaries and short-term employee benefits   | $ | 1,633       | 
| | Share-based compensation                    |   | 516         | 
| | Termination benefits                        |   | 158         | 
| | Key management
      personnel compensation | $ | 2,307       | 

|25. | CAPITAL MANAGEMENT AND FINANCIAL RISK                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Capital Management                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Companys capital includes cash, cash equivalents,
      investments in debt instruments and debt obligations. The Companys
      primary objective with respect to its capital management is to ensure that
      it has sufficient capital to maintain its ongoing operations, to provide
      returns for shareholders and benefits for other stakeholders and to pursue
      growth opportunities.                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Planning, annual budgeting and controls over major
      investment decisions are the primary tools used to manage the Companys
      capital. The Companys cash is managed centrally and disbursed to the
      various regions via a system of cash call requests which are reviewed by
      the key decision makers. Under the Companys delegation of authority
      guidelines, significant debt obligations require the approval of both the
      CEO and the CFO before they are entered into.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company manages its capital by review of the
      following measure:                                                                                                                                                                                                                                                                                                                                                                                                                                 

| |                                              |   | At
      December 31 |   |   | At
      December 31 |  
| | -------------------------------------------- | - | -------------------- | - | - | -------------------- | -
| | (in thousands)                               |   | 2014                 |   |   | 2013                 |  
| |                                              |   |                      |   |   |                      |  
| | Net cash:                                    |   |                      |   |   |                      |  
| | Cash and cash equivalents                    | $ | 18,640               |   | $ | 21,786               |  
| | Investments in debt instruments (see note 9) |   | 4,381                |   |   | 14,818               |  
| | Debt obligations - current                   |   | (30                  | ) |   | (55                  | )
| | Debt
      obligations  long term           |   | (9                   | ) |   | (42                  | )
| | Net cash                                     |   | 22,982               |   |   | 36,507               |  

Financial Risk

The Company examines the various
financial risks to which it is exposed and assesses the impact and likelihood of
those risks. These risks may include credit risk, liquidity risk, currency risk,
interest rate risk and price risk.

(a)     
Credit Risk

Credit risk is the risk of loss due to
a counterpartys inability to meet its obligations under a financial instrument
that will result in a financial loss to the Company. The Company believes that
the carrying amount of its cash and cash equivalents, trade and other
receivables, investments in debt instruments and restricted cash and investments
represents its maximum credit exposure.

- 39 -

---

The maximum exposure to credit risk at
the reporting dates is as follows:

| |                                       |   | At
      December 31 |  |   | At
      December 31 | 
| | ------------------------------------- | - | -------------------- |  | - | -------------------- | 
| | (in thousands)                        |   | 2014                 |  |   | 2013                 | 
| |                                       |   |                      |  |   |                      | 
| | Cash and cash equivalents             | $ | 18,640               |  | $ | 21,786               | 
| | Trade and other receivables           |   | 9,411                |  |   | 4,148                | 
| | Investments in debt
      instruments |   | 4,381                |  |   | 14,818               | 
| | Restricted cash and investments       |   | 2,068                |  |   | 2,299                | 
| |                                       | $ | 34,500               |  | $ | 43,051               | 

The Company limits cash and cash
equivalents, investment in debt instruments and restricted cash and investment
risk by dealing with credit worthy financial institutions. The Companys trade
and other receivables balance relates to a small number of customers who are
credit worthy and with whom the Company has established a relationship with
through its past dealings.

(b)    
 Liquidity Risk

Liquidity risk is the risk that the
Company will encounter difficulties in meeting obligations associated with its
financial liabilities as they become due. The Company has in place a planning
and budgeting process to help determine the funds required to support the
Companys normal operating requirements on an ongoing basis. The Company ensures
that there is sufficient committed capital to meet its short-term business
requirements, taking into account its anticipated cash flows from operations,
its holdings of cash and cash equivalents and its access to credit and capital
markets, if required.

The maturities of the Companys
financial liabilities are as follows:

| |                                                |   | Within
      1 |  |   | 1 to 5 | 
| | ---------------------------------------------- | - | -------------- |  | - | ------ | 
| | (in thousands)                                 |   | Year           |  |   | Years  | 
| |                                                |   |                |  |   |        | 
| | Accounts payable and accrued
      liabilities | $ | 10,050         |  | $ | -      | 
| | Debt
      obligations (Note 15)               |   | 30             |  |   | 9      | 
| |                                                | $ | 10,080         |  | $ | 9      | 

(c)     
Currency Risk

Foreign exchange risk is the risk that
the fair value of future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. The Company operates
internationally and is exposed to foreign exchange risk arising from various
currency exposures as its subsidiaries incur operating and capital costs
denominated in local currencies. Foreign exchange risk also arises from assets
and liabilities that are denominated in a currency that is not the functional
currency for the relevant subsidiary company.

Currently, the Company does not have
any foreign exchange hedge programs in place and manages its operational foreign
exchange requirements through spot purchases in the foreign exchange markets.
The impact of the U.S dollar strengthening (by approximately 10%) at December
31, 2014 against the Companys foreign currencies, with all other variables held
constant, is as follows:

| |                                                    |  | Dec.312014 |  |  | Sensitivity |  |   | Change
      in |  
| | -------------------------------------------------- |  | ----------- |  |  | ----------- |  | - | --------------- | -
| |                                                    |  | Foreign Ex- |  |  | Foreign Ex- |  |   | net income      |  
| | (in thousands
      except foreign exchange rates) |  | Change Rate |  |  | Change Rate |  |   | (loss)          |  
| |                                                    |  |             |  |  |             |  |   |                 |  
| | Currency risk                                      |  |             |  |  |             |  |   |                 |  
| | Canadian dollar (CAD)                            |  | 1.1601      |  |  | 1.2761      |  | $ | 14,526          |  
| | Mongolian tugrog (MNT)                           |  | 1,881.11    |  |  | 2,069.23    |  |   | (3,891          | )
| | West Africa French Franc
      (CFA)             |  | 539.67      |  |  | 593.63      |  |   | (6,365          | )
| | Zambian kwacha (ZMW)                             |  | 6.4297      |  |  | 7.0727      |  |   | (4,698          | )
| |                                                    |  |             |  |  |             |  | $ | (428            | )

(d)     
Interest Rate Risk

Interest rate risk is the risk that the
fair value or future cash flows of a financial instrument will fluctuate because
of changes in market interest rates. The Company is exposed to interest rate
risk on its liabilities through its outstanding borrowings and on its assets
through its investments in debt instruments. The Company monitors its exposure
to interest rates and has not entered into any derivative contracts to manage
this risk.

- 40 -

---

(e)    
 Price Risk

The Company is exposed to equity price
risk as a result of holding equity investments in other exploration and mining
companies. The Company does not actively trade these investments. The
sensitivity analysis below has been determined based on the exposure to equity
price risk at December 31, 2014:

| |                                     |   | Change
      in |  |   | Change
      in | 
| | ----------------------------------- | - | --------------- |  | - | --------------- | 
| |                                     |   | net income      |  |   | Comprehensive   | 
| | (in thousands)                      |   | (loss)          |  |   | income (loss)   | 
| |                                     |   |                 |  |   |                 | 
| | Equity price risk                   |   |                 |  |   |                 | 
| | 10% increase in
      equity prices | $ | 93              |  | $ | 95              | 
| |                                     |   |                 |  |   |                 | 

Fair Value of Financial Instruments

IFRS requires disclosures about the
inputs to fair value measurements, including their classification within a
hierarchy that prioritizes the inputs to fair value measurement. The three
levels of the fair value hierarchy are:

| |  | Level 1  Unadjusted quoted prices in active markets for
      identical assets or liabilities;                                  
| | - | ---------------------------------------------------------------------------------------------------------------------------------
| |  | Level 2  Inputs other than quoted prices that are
      observable for the asset or liability either directly or indirectly; and
| |  | Level 3  Inputs that are not based on observable market
      data.                                                             

The fair value of financial instruments
which trade in active markets (such as equity instruments) is based on quoted
market prices at the balance sheet date. The quoted marked price used to value
financial assets held by the Company is the current closing price.

Except as otherwise disclosed, the fair
values of cash and cash equivalents, trade and other receivables, accounts
payable and accrued liabilities, restricted cash and cash equivalents and debt
obligations approximate their carrying values as a result of the short-term
nature of the instruments, or the variable interest rate associated with the
instruments, or the fixed interest rate of the instruments being similar to
market rates.

The following table illustrates the
classification of the Companys financial assets within the fair value hierarchy
as at December 31, 2014 and December 31, 2013:

| |                                               |  | Financial   |  |  | Fair      |  |   | December 31,     |  |   | December 31,     | 
| | --------------------------------------------- |  | ----------- |  |  | --------- |  | - | ---------------- |  | - | ---------------- | 
| |                                               |  | Instrument  |  |  | Value     |  |   | 2014             |  |   | 2013             | 
| | (in thousands)                                |  | Category(1) |  |  | Hierarchy |  |   | Fair
      Value |  |   | Fair
      Value | 
| |                                               |  |             |  |  |           |  |   |                  |  |   |                  | 
| | Financial Assets:                             |  |             |  |  |           |  |   |                  |  |   |                  | 
| | Cash and equivalents                          |  | Category D  |  |  |           |  | $ | 18,640           |  | $ | 21,786           | 
| | Trade and other receivables                   |  | Category D  |  |  |           |  |   | 9,411            |  |   | 4,148            | 
| | Investments                                   |  |             |  |  |           |  |   |                  |  |   |                  | 
| | Equity instruments                            |  | Category A  |  |  | Level 1   |  |   | 916              |  |   | 1,106            | 
| | Equity instruments                            |  | Category A  |  |  | Level 2   |  |   | 16               |  |   | -                | 
| | Equity instruments                            |  | Category B  |  |  | Level 1   |  |   | 22               |  |   | 17               | 
| | Debt instruments                              |  | Category A  |  |  | Level 1   |  |   | 4,381            |  |   | 14,818           | 
| | Restricted cash and equivalents               |  |             |  |  |           |  |   |                  |  |   |                  | 
| | Elliot Lake
      reclamation trust fund      |  | Category C  |  |  |           |  |   | 2,068            |  |   | 2,299            | 
| |                                               |  |             |  |  |           |  | $ | 35,454           |  | $ | 44,174           | 
| |                                               |  |             |  |  |           |  |   |                  |  |   |                  | 
| | Financial Liabilities:                        |  |             |  |  |           |  |   |                  |  |   |                  | 
| | Account payable and accrued
      liabilities |  | Category E  |  |  |           |  |   | 10,050           |  |   | 7,992            | 
| | Debt
      obligations                        |  | Category E  |  |  |           |  |   | 39               |  |   | 97               | 
| |                                               |  |             |  |  |           |  | $ | 10,089           |  | $ | 8,089            | 

| | (1) | Financial instrument designations are as follows:
      Category A=Financial assets and liabilities at fair value through profit
      and loss; Category B=Available for sale investments; Category C=Held to
      maturity investments; Category D=Loans and receivables; and Category
      E=Financial liabilities at amortized cost.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

- 41 -

---

|26. | COMMITMENTS AND CONTINGENCIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | General Legal Matters                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company is involved, from time to time, in various
      legal actions and claims in the ordinary course of business. In the
      opinion of management, the aggregate amount of any potential liability is
      not expected to have a material adverse effect on the Companys financial
      position or results.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Third Party Indemnities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company remains a guarantor under a sales contract
      included in the sale of the U.S. Mining Division to Energy Fuels Inc.
      (EFR) in June 2012. The sales contract requires deliveries of 200,000
      pounds of U3O8  per year from 2013 to 2017 at a selling price of 95% of the
      long-term U3O8  price at the time of delivery. Should EFR not be able to
      deliver for any reason other than force majeure as defined under the
      contract, the Company may be liable to the customer for incremental costs
      incurred to replace the contracted quantities if the unit price of the
      replacement quantity is greater than the contracted unit price selling
      amount. EFR has agreed to indemnify the Company for any future liabilities
  it may incur related to this guarantee.                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company has agreed to indemnify EFR against any
      future liabilities it may incur in connection with ongoing litigation
      between Denison Mines (USA) Corp (DUSA) (a company acquired by EFR as
      part of the sale of the U.S. Mining Division) and a contractor in respect
      of a construction project at the White Mesa mill. In the event that the
      matter is decided in DUSAs favour, the Company is entitled to any
      proceeds that are received or recovered by EFR pursuant to its indemnity.
      Both parties agreed to resolve the dispute via binding arbitration and
      arbitration hearings for this matter were held in November 2013. In
      January 2014 an arbitration order was issued in DUSAs and Denisons
      favour. The contractor subsequently filed a motion to vacate the
      arbitration award. Denison filed a response in opposition and, in July
      2014, the court denied the motion to vacate the arbitration award. The
      Company does not expect to recover a material amount of damages related to
      this issue.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Performance Bonds and Letters of Credit                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | In conjunction with various contracts, reclamation and
      other performance obligations, the Company may be required to issue
      performance bonds and letters of credit as security to creditors to
      guarantee the Companys performance. Any potential payments which might
      become due under these items would be related to the Companys
      non-performance under the applicable contract. As at December 31, 2014,
      the Company had outstanding letters of credit of $9,329,000 of which
      $9,329,000 (CAD$9,898,000) is collateralized by a reduction in the amount
      available under the Companys 2014 credit facility (see note
15).                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Others                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Company has committed to payments under various
      operating leases and other commitments. Excluding spending amounts which
      may be required to maintain the Companys mineral properties in good
      standing, the future minimum payments are as
  follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

| | (in thousands)      |   |     | 
| | ------------------- | - | --- | 
| |                     |   |     | 
| | 2015                | $ | 269 | 
| | 2016                |   | 144 | 
| | 2017                |   | 42  | 
| | 2018                |   | 11  | 
| | 2019 and thereafter |   | 7   | 
| |                     | $ | 473 | 

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|27. | INTEREST IN OTHER ENTITIES                                                                                                                                           
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                      
|    | The significant entities and contractual interests in
      which Denison has a non-100% voting / participating interest at December
      31, 2014 are listed below.

Place
    
    Denison
    DenisonOf
    Entity
    Voting
    Participating
    AccountingBusiness
    Type
      (1)
    Interest (2)
    Interest (3)
    Method (4)Non-100% Owned
      EntitiesWaterbury Lake Uranium Corp
    Canada
    JO-1
    60.00%
    60.00%
    Proportionate
      ShareWaterbury Lake Uranium LP
    Canada
    JO-1
    60.00%
    60.00%
    Proportionate SharePitchstone Namibia (Pty) Ltd
    Namibia
    SUB
    90.00%
    100.00%
    ConsolidationGurvan Saihan Joint Venture
    Mongolia
    SUB
    85.00%
    100.00%
    ConsolidationNon-100% Owned Contractual
      ArrangementsMcClean Joint Venture Agreement
    Canada
    JO-2
    22.50%
    22.50%
    Proportionate ShareMidwest Joint Venture
      Agreement
    Canada
    JO-2
    25.17%
    25.17%
    Proportionate
      ShareWheeler River
    Canada
    JO-2
    60.00%
    60.00%
    Proportionate ShareMann Lake
    Canada
    JO-2
    30.00%
    30.00%
    Proportionate
      ShareWolly
    Canada
    JO-2
    22.50%
    22.50%
    Proportionate Share


| | (1) | The Entity Type classifications are as follows:
      SUB=Subsidiary; JO-1=Joint Operations having joint control as defined by
      IFRS 11; and JO- 2=Joint Operations not having joint control and beyond
      the scope of IFRS 11;                                       
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Voting Interest represents Denisons percentage voting
      interest in the entity or contractual arrangement;                                                                                                                                                                
| | (3) | Participating interest represents Denisons percentage
      funding contribution to the particular arrangement. This percentage can
      differ from equity interest in instances where other parties to the
      arrangement have carried interests in the arrangement; and
| | (4) | Proportionate share is where Denison accounts for its
      share of assets, liabilities, revenues and expenses of the arrangement in
      relation to its participating interest.                                                                                            

|    | Pitchstone Namibia (Pty) Ltd (Pitchstone Namibia) was
      acquired by Denison as part of the Fission arrangement (see note 5).
      Pitchstone Namibias key asset is the Dome project. Denisons
      participating interest is larger than its voting interest at this time due
      to its partners carried interest. Denison is currently funding 100% of
      the activities of this entity.                                                                                                                                                                                                                                                                          
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The Gurvan Saihan Joint Venture holds Denisons mineral
      property assets in Mongolia. Denisons participating interest is larger
      than its voting interest at this time due to its partners carried
      interest (see note 11). Denison is currently funding 100% of the
      activities of this entity.                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|28. | SUBSEQUENT EVENTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Bank of Nova Scotia Credit Facility
  Renewal                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | On January 30, 2015, the Company entered into an
      agreement with the Bank of Nova Scotia to amend the terms of the 2014
      facility and extend the maturity date to January 31, 2016 (see note 15).
      Under the 2015 facility, the Company has access to credit up to
      CAD$24,000,000. Use of the 2015 facility remains restricted to non-
      financial letters of credit in support of reclamation obligations (see
      note 14).                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The 2015 facility contains a covenant to maintain a level
      of tangible net worth greater than or equal to the sum of $150,000,000 and
      a covenant to maintain a minimum balance of cash and equivalents of
      CAD$5,000,000 on deposit with the Bank of Nova Scotia. As security for the
      amended facility, DMC has provided an unlimited full recourse guarantee
      and a pledge of all of the shares of DMI. DMI has provided a
      first-priority security interest in all present and future personal
      property and an assignment of its rights and interests under all material
      agreements relative to the McClean Lake and Midwest projects.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The 2015 facility is subject to letter of credit and
      standby fees of 2.40% and 0.75% respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

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