Development delays and the expected timing of ground freezing as the mine transitioned into two new mining areas were among a list of potential risks to the McArthur River mine production schedule that were identified by the company back in January. These delays have meant that some production from operations at the site in Saskatchewan is being deferred, although this is partially being offset by strong performance at the Cigar Lake mine, Cameco said in its latest update on its 2025 production plans.
"The impact of these risks was dependent on the magnitude of the delay, the McArthur River mine’s ability to substitute feed for the Key Lake mill with production from alternative mining areas, and our ability to offset reduced production from McArthur River/Key Lake with additional production from the Cigar Lake mine," the company said in an update released on 28 August. "We have determined that we are unable to fully mitigate the expected impact of the delayed development and slower than anticipated ground freezing in the first half of 2025."
2025 production from the McArthur River/Key Lake operation is now anticipated to be between 14 million and 15 million pounds U3O8 (5385-5770 tU) on a 100% basis (9.8-10.5 million pounds for Cameco's share) in 2025. This is down from the previous forecast, of 18 million pounds U3O8 (100% basis; 12.6 million for Cameco's share).
"At the Cigar Lake mine, we continue to expect to produce 18 million pounds U3O8 (100% basis; 9.8 million pounds our share) this year, however performance to date at Cigar Lake has been strong, creating an opportunity to potentially offset up to 1 million pounds (100% basis) of the shortfall at the McArthur River/Key Lake operation," the company said.
The McArthur River mine is owned 69.805% by Cameco and 30.195% by Orano. The Key Lake mill is owned 83.333% by Cameco and 16.667% by Orano. Cigar Lake is owned 54.547% by Cameco, 40.453% by Orano Canada Inc. (Orano) and 5% by TEPCO Resources Inc.
Rise Air contract
In a separate announcement, Cameco and Orano Canada Inc announced the signature of a 15-year agreement with Indigenous-owned airline Rise Air, to provide workforce transportation services for northern Saskatchewan operations. The agreement is worth around CAD500 million (USD364 million).
This is the latest agreement between the companies in a relationship dating back to 1993, although previous agreements with Rise Air have typically spanned three years or less.
Rise Air CEO Derek Nice said the 15-year agreement will be transformative for Saskatchewan’s largest regional airline, which plays a vital role in connecting northern communities and supporting regional economic development. "It means we can plan for the future with confidence - investing in modern equipment, upgrading our facilities, and expanding hiring and training. Most importantly, it allows us to focus on building long-term careers for residents of northern Saskatchewan."
"Air transportation is critical to our operations in northern Saskatchewan," Cameco President and CEO Tim Gitzel said. "Without the ability to fly workers to our remote sites, we cannot operate. This contract ensures continued access to our sites through an exciting new fleet of aircraft."
Rise Air is owned by Athabasca Basin Development and Prince Albert Development Corp, and is one of Canada’s largest indigenous-owned air carriers operating 24 aircraft. The ownership collectively impacts 12 First Nations and four municipalities.
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