UPDATE 1-Denison Mines Q1 loss narrows

* Q1 loss $0.01/shr vs yr-ago loss $0.06/shr

* Revenue up 21 pct to $22 mln

May 13 (Reuters) - Canadian uranium producer Denison Mines Corp (DML.TO) posted a narrower quarterly loss, as higher sales volume in the United States offset a drop in uranium prices.

For the first quarter, the company reported a loss of $1.3 million, or 1 cent a share, compared with a loss of $10.5 million, or 6 cents a share, a year-ago.

Revenue rose 21 percent to $22 million for the quarter.

Analysts, on average, were expecting the company to report a loss of 4 cents a share, before items, on revenue of $17.68 million, according to Reuters Estimates.

During the quarter, Denison sold 225,000 pounds of Triuranium octoxide (U3O8) from U.S. production at an average price of $66.03 per pound and 98,000 pounds U3O8 from its Canadian production at an average price of $49.91 per pound.

In the same quarter last year, Denison sold 50,000 pounds U3O8 from U.S. production at a price of $90.25 per pound and 147,000 pounds U3O8 from its Canadian production at an average price of $71.54 per pound.

Spot uranium oxide prices have been in almost steady decline since topping out at $136 a pound in June 2007.

Denison Mines shares, which more than doubled in the last one month, closed at C$2.22 Wednesday on the Toronto Stock Exchange. (Reporting by R. Manikandan in Bangalore; Editing by Ratul Ray Chaudhuri)