Canadian firms extend suspension of uranium operations

Saskatoon-based Cameco on 23 March put Cigar Lake on care and maintenance for an initial period of four weeks. Now, with the impact of COVID-19 continuing to escalate, the Cigar Lake workforce will need to remain at its current reduced level for a longer duration, the company said.

"The global challenges posed by this pandemic are not abating - in fact, they are deepening," Cameco President and CEO Tim Gitzel said. "We therefore need to stay vigilant and do everything we can to keep people and families safe. We are especially sensitive to the situation in the remote, isolated communities of northern Saskatchewan that are home to a sizeable portion of the workforce at Cigar Lake."

The company, which last week said it was assessing the impacts of Kazatomprom's decision to temporarily decrease operational activity at their Inkai joint venture in Kazakhstan, has said it is now withdrawing its outlook for 2020 g]iven the "rapidly developing COVID-19 pandemic and the number of moving pieces it creates". It will provide a business update when it reports its first-quarter results but does not expect to resume providing outlook information "until we have a sufficient basis to assess the future implication for us", it said.

Cameco expects its business to be "resilient" despite the current uncertainties, Gitzel said. "With many governments and communities declaring states of emergency in their jurisdictions, our utility customers' nuclear power plants are part of the critical infrastructure needed to guarantee the availability of 24-hour electricity to run hospitals, care facilities and essential services. So our customers are going to need uranium. As a reliable, independent, commercial supplier, we will continue to work with them to help meet their delivery needs.

"However, the COVID-19 pandemic has disrupted global uranium production, adding to the supply curtailments that have occurred in the industry for many years. As such, we believe the risk to uranium supply is greater than the risk to uranium demand, creating a renewed focus on ensuring availability of long-term supply. Over time, we expect this renewed focus on security of supply will provide the market signals producers need, and will help offset any near-term costs we may incur as a result of the current disruptions to our business."

Care and maintenance crews remaining at all four of Cameco's mining and milling operations in northern Saskatchewan are in a safe working environment, the company said. The Rabbit Lake uranium mine has been under care and maintenance since the second quarter of 2016, and the two-site McArthur River/Key Lake operation since July 2018. The company last week also announced operational changes at its fuel services division facilities in Ontario, including the temporary suspension of operations at the Port Hope uranium conversion facility and the Blind River refinery.

Cigar Lake is owned by Cameco (50.025%), Orano Canada Inc (37.1%), Idemitsu Canada Resources Ltd. (7.875%) and TEPCO Resources Inc (5.0%), and is operated by Cameco.