Cameco delays Millennium Mine
Cameco Corp.’s decision to delay construction of its Millennium uranium mine is one more reminder of Saskatchewan’s vulnerability to the whims of commodities markets, experts say.
However, the province’s economy should be strong enough to weather the recent troubles in the uranium and potash industries, they add. Robust oil prices, a record grain harvest and other factors provide reasons for optimism.
“Saskatchewan has got everything the world wants,” said Colin Boyd, professor of management in the University of Saskatchewan’s Edwards School of Business.
Boyd said reliance on any single commodity “can be a roller-coaster ride,” but Saskatchewan is diversifying.
“I think we’ll be absolutely fine,” he said.
Fellow Edwards School professor Brooke Dobni said there may not be record economic growth every year, but the long-term outlook is good.
“We’re not at the peak, and there are so many variables we don’t control, but we’re still doing OK, Dobni, the school’s chair for Saskatchewan enterprise, said.
Cameco’s Millennium uranium mine project is 36 kilometres from the company’s Key Lake operation in the Athabasca Basin. Cameco owns 69.9 per cent of the project and serves as the operator, with Japan’s JCU Exploration Co. owning the remainder.
Citing “current economic conditions,” Cameco told the Canadian Nuclear Safety Commission it does not wish to proceed with its bid for a licence. Public hearings scheduled for June 18 to consider Cameco’s application for a 10-year licence have been adjourned.
The provincial government approved Cameco’s environmental impact assessment for the project late last year.
“We’ve been expecting a (price) recovery for some time, and it just isn’t happening,” Struthers said.
Struthers said the delay is temporary, and plans will restart once world prices improve.
That delay will likely be measured in years rather than weeks or months, Boyd and Dobni said. World prices and supply are not the only factors at play in the uranium business, they said.
“It could be five, 10 years or more. In the meantime, we could have another Fukushima,” Boyd said, referring to the 2011 nuclear plant meltdown in Japan.
There are negative signs for the uranium industry such as Germany’s move away from nuclear power and the increasing costs which make construction of new plants questionable. However, China is betting on nuclear power and is building several reactors. Also, the agreement to use the uranium from decommissioned nuclear warheads is coming to a close, creating the need for other suppliers, Dobni said.
“The price will eventually rebound,” Dobni said.