Cameco extends closures, withdraws outlook
Cameco (NYSE:CCJ) announced today that it is extending the temporary production suspension at the Cigar Lake uranium mine in northern Saskatchewan as the effects of the global COVID-19 pandemic persist.
Cameco announced on March 23 that the Cigar Lake operation was being placed in safe care and maintenance mode for four weeks, during which it would assess the status of the situation and determine whether to restart the mine or extend the production suspension.
With the impact of COVID-19 continuing to escalate, Cameco has determined that the Cigar Lake workforce will need to remain at its current reduced level for a longer duration. The precautions and restrictions put in place by the federal and provincial governments, the increasing significant concern among leaders in the remote isolated communities of northern Saskatchewan, and the challenges of maintaining the recommended physical distancing at fly-in/fly-out sites with a full workforce were critical factors Cameco considered in reaching this decision.
Cameco will therefore keep the facility in safe care and maintenance for an indeterminate period. The company will monitor the situation on a continual basis to determine when a safe, sustainable restart is possible.
Cigar Lake ore is processed at Orano Canada Inc.’s McClean Lake mill, which is also presently in care and maintenance. Orano has also decided to extend the temporary production suspension at its McClean Lake mill.
“The global challenges posed by this pandemic are not abating – in fact, they are deepening,” Cameco’s 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 said care and maintenance crews remaining at all four of Cameco’s mining and milling operations in northern Saskatchewan are in a safe working environment. Guidance and direction from public health authorities are being followed closely, and the smaller workforces that remain have proven to be much more conducive to achieving the recommended physical distancing and enhanced safety precautions.
"The proactive decisions we have made to protect our employees and to help slow down the spread of the COVID-19 virus are necessary decisions and they are consistent with our values.
"Given the rapidly developing COVID-19 pandemic and the number of moving pieces it creates, we are withdrawing our outlook for 2020. Although we will provide a further update on our business when we report our first quarter results before markets open on May 1, 2020, we do not expect to resume providing outlook information until we have a sufficient basis to assess the future implication for us," said the company.