“Unfortunately, continued depressed market conditions do not support the operating and capital costs needed to sustain production at Rabbit Lake and the US operations”, Cameco CEO Tim Gitzel said in a statement. Production at the United States in situ leach operations can not cease immediately because of the nature of the technology, and will instead decrease over time as head grades decline.
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It says it will keep about 150 people at Rabbit Lake to maintain the facilities and do environmental monitoring and reclamation. The decision is expected to result in about 85 job losses, with around 170 employees remaining at existing facilities. “Rabbit Lake is a higher cost mine and had a limited life”. The company said between Rabbit Lake and its smaller USA operations, it expects to save about $48 million in capital costs this year, while spending about $19 million on severances.
Wall says the province will work with companies and the federal government to find new markets and build demand for Saskatchewan uranium. “We will take the opportunity from additional downtime at the mill to further advance work needed to increase the mill’s production capacity for when the market signals it is needed”. It said production continues to ramp up at Cigar Lake in Saskatchewan, where commercial production started last May. Previously, planned production for the year had been 30 million pounds.
The premier says if there’s some hope, it’s that Cameco is not closing the mine completely and permanently.
Due to oversupply in the market, Cameco said it has reduced its 2016 production target at its McArthur River/Key Lake operation in Saskatchewan to 18 million pounds from 20 million pounds. Recent production has been from the Eagle Point deposit.
Saskatoon-based Cameco suspended production at its Rabbit Lake operation, near Wollaston Lake. Rabbit Lake is 100%-owned by Cameco.
The layoffs account for a large share of the estimated 300 people employed in uranium mining in Wyoming, the top uranium-mining state.
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The company operates the Smith Ranch-Highland mine near Glenrock and the North Butte mine south of Gillette.
