Cameco plans Sept. restart of Cigar Lake mine

SASKATOON -- Cameco plans to restart the Cigar Lake mine in northern Saskatchewan at the beginning of September.

“While health and safety are the primary considerations for the timing of our Cigar Lake mine restart decision, there were also commercial considerations, including market-related factors and the impact on our cost structure,” president and CEO Tim Gitzel said in a news release Wednesday.

“We will not be able to make up the lost production and are therefore targeting our share of 2020 production to be up to 5.3 million pounds in total. With the uncertainty remaining about our ability to restart and continue operating the Cigar Lake mine, the delays and deferrals of project work and therefore the resulting production rate in 2020 and 2021, we believe the current plan represents an appropriate balance of the commercial considerations affecting our decision.”

Cameco suspended production at the facility in March.

The restart will depend on Cameco’s ability to establish safe and stable operating protocols, the availability of workers and how the COVID-19 pandemic is affecting northern Saskatchewan, the release says.

Gitzel expects the company’s business to be resilient during the COVID-19 pandemic.

“Our customers continue to need uranium fuel to power the carbon-free nuclear electricity that will be part of the critical infrastructure needed to ensure hospitals, care facilities and other essential services are available during this pandemic.

“However, the COVID-19 pandemic has disrupted global uranium production adding to the supply curtailments that have already occurred in the industry due to the lack of production economics. The industry is reliant on supply that has become highly concentrated both geographically and geologically. With the ongoing uncertainty about supply during the pandemic and trade policy issues, we think the risks to supply are greater than the risk to demand.”

Cameco racked up $37 million in care and maintenance costs and an increased reliance on the spot market for uranium supply after it shut down operations.