Saskatoon, Saskatchewan, Canada, April 2, 1990

Cameco - A Canadian Mining & Energy Corporation and Uranerz Exploration and Mining Limited have signed agreements for the sale by Cameco to Uranerz of a one-third interest in the Rabbit Lake uranium mining operation, one of Cameco's producing properties in northern Saskatchewan, for a total price of $160 million.

The Rabbit Lake assets involved in the sale include a one-third interest in each of the mill, the three Collins Bay uranium deposits, the Eagle Point South deposit and surrounding exploration properties. Uranerz already has a one-third interest in the Eagle Point North deposit. The two Eagle Point deposits will be developed as one underground mine. The Rabbit Lake mill, which has been closed for upgrading, is capable of producing 12 million pounds of yellowcake annually. Current uranium reserves on these properties will support mill operations well into the next century.

"We're very pleased to expand our close business relationship with Uranerz," said Cameco's Chairman, President and Chief Executive Officer, William A. Gatenby, when announcing the sale. "Cameco and Uranerz enjoy a long history of successful joint ventures in Saskatchewan," he said, noting the two companies also hold a two- third, one-third ownership position in the Key Lake uranium mine. Cameco will continue to operate both uranium mines. In addition, both companies have been involved in the Star Lake gold project and are joint venturers in the recent Preview gold discovery.

"This sale is a good deal for both companies," Gatenby said. "Cameco retains its majority ownership position in Rabbit Lake and has sold a relatively small portion of its total reserves, but we will be able to retire a significant portion of our debt. In addition, we value Uranerz as a partner and we appreciate the sharing of technical expertise with them. The joint venture between our two experienced mining companies will be especially valuable as the project enters a new phase of underground development at Eagle Point."

For Uranerz, which is a wholly owned subsidiary of Uranerzbergbau-Gmbh, Bonn, Germany, and part of an international mining group with mining and exploration activities in North America and Australia, the transaction enhances long-term security of uranium supply. The Uranerz group has been active in Saskatchewan since 1968 and discovered the Key Lake ore bodies in 1975.

"The future of the uranium industry belongs to Saskatchewan," said Uranerz's Chairman and Chief Executive Officer, Gerhard Glattes. "We are anxious to put our company in an advantageous position to capitalize on anticipated future increases in uranium demand. We are confident that the nuclear option for generating electricity has long-term growth potential around the world. An ownership position in Rabbit Lake adds to Uranerz's strength as a major uranium producer."

The transaction, which is subject to regulatory approvals and usual closing conditions, is expected to conclude no later than July, 1990.

 

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For further information, please contact:

Rita Mirwald Manager, Corporate Affairs Cameco - A Canadian Mining & Energy Corporation #1200, 410 - 22nd Street East Saskatoon, Saskatchewan S7K 5T6 Phone: (306) 956-6313

Dr. Hikmet Akin Executive Vice-president Uranerz Exploration and Mining Limited #1300, 410 - 22nd Street East Saskatoon, Saskatchewan S7K 5T6 Phone: (306) 242-5101