Sask. uranium company Cameco to restart McArthur River mine and Key Lake mill this year

A Saskatchewan-based uranium company is planning to restart operations at a mining operation that has been shut down for just over four years.

On Wednesday, Cameco announced its plans to restart the McArthur River mine site and Key Lake mill sometime in 2022. Uranium ore from the mine, which is about 630 kilometres northeast of Saskatoon, is processed at the mill, which is about 570 kilometres northeast of Saskatoon.

The mining operation was suspended in January 2018 then shut down long-term in July 2018 due to a lengthy period of low uranium prices. Hundreds of employees at the site and at corporate head office were laid off.

"We're delighted to be back," said Cameco president and CEO Tim Gitzel on Wednesday. 

"We'll be producing again. We'll be employing people, we'll be hiring northern contractors, we'll be paying our taxes and royalties to the province, which are happy to do, and it's just good all around."

Gitzel said that roughly 200 people had remained working at the two sites since the shutdown, doing care and maintenance. Once the two sites are fully operational, he expects them to employ around 900 people over the next year and a half.

The company expects that the McArthur River site will produce five million pounds (2.3 million kilograms) of uranium in its first year and will ramp up to 15 million pounds (6.8 million kilograms) by 2024.

Gitzel said uranium prices have dramatically risen since the decision was made to shut the two sites down — from $17 per ounce in 2018 to a current price of $42.

He believes that uranium will continue to be attractive as a green source of electricity.

"You can't throw any of the tools out of the toolbox," he said. 

"We're going to need every source of energy that we have going forward and nuclear is going to be one of them."

Premier Scott Moe echoed Gitzel's sentiments and said he believed the uranium industry has a promising future.

"The nuclear power industry has had a number of very challenging years over the last decade, but that is changing today," said Moe.

"We see countries around the world putting forward net carbon targets, net zero targets with respect to their carbon emissions."

Earnings report

The announcement on McArthur River came on the same day as the company's fourth-quarter earnings report.

Revenue for the quarter was $465 million, down from $550 million in the fourth quarter of 2020.

In its outlook for this year, Cameco says it expects revenue for 2022 to be between $1.5 billion and $1.65 billion. Capital expenditures for the year are estimated between $150 million and $175 million.