Uranium & Fuel

Covid-19 / Cameco Announces Second Pandemic-Related Shutdown At Cigar Lake

By David Dalton
15 December 2020

Cameco Announces Second Pandemic-Related Shutdown At Cigar Lake
The Cigar Lake mine was also shut down in March because of the Covid-19 pandemic. Photo courtesy Cameco.
Cameco is temporarily suspending production at its Cigar Lake uranium mine in northern Saskatchewan over the coming weeks due to the increasing risks posed by the Covid-19 pandemic.

It is the second Covid-related shutdown at the facility. The first began in March and lasted for five months.

The company said Saskatchewan is experiencing a significant negative trend in the pandemic, which is leading to increased uncertainty for the continuous operation of Cigar Lake, due in part to access to qualified operational personnel.

Cameco president and chief executive officer Tim Gitzel said Cameco has had six positive tests at its northern operations in recent weeks, including three at Cigar Lake. “One of the most challenging trends we’ve had to navigate is the shrinking availability of workers in critical roles at Cigar Lake due to self-isolations, absenteeism and communities being on temporary pause for transporting workers due to the pandemic,” he said.

Cameco will be placing the mine in a safe state of care and maintenance and there will be a significant reduction in personnel from the 300 usually onsite.

The suspension will hit the company’s bottom line, costing it between CAD8m ($6.2m) and CAD10m per month, a statement said. The company will not meet its share of producing 5.3 million pounds of uranium concentrates by the end of the year.

When the mine closed for safety reasons in March, Cameco saw a roughly CAD61m loss in Q3.

“Due to the suspension, we plan to increase our purchases in the market to secure uranium we need to meet our sales commitments,” Mr Gitzel said. “We expect our business to be resilient. Our deliveries to date have not been materially impacted by Covid-19, nor do we expect there will be a material impact on our remaining 2020 deliveries.”

In 2018 Cameco closed down its McArthur River mine, the Key Lake milling facility and the Rabbit Lake mine, all in northern Saskatchewan, resulting in hundreds of layoffs, and making redundancies at its corporate headquarters in Saskatoon. The closures were the result of what Cameco called a “persistently weak” global uranium market.

The Cigar Lake operation 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.

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