Cameco Signs Agreement with United States Enrichment Corporation

Saskatoon, Saskatchewan, Canada, July 29, 1996

Cameco Corporation announced today it has entered into an agreement with the United States Enrichment Corporation (USEC) to develop the technology and demonstrate the technical and economic feasibility of converting uranium into feedstock for the advanced uranium enrichment process being developed by USEC.

Known as atomic vapor laser isotope separation (AVLIS), the enrichment process uses laser technology to enrich uranium—a necessary step in the manufacture of fuel for most nuclear energy plants.

Cameco's involvement will be through its fuel services division in Ontario. The Blind River refinery will provide high-purity uranium trioxide (UO₃) as an intermediate product, while the tests for the development and demonstration phases of the feedstock production technology will be conducted at the Port Hope conversion facilities.

"We are extremely pleased to launch a commercial relationship with the world's largest provider of enrichment services and to apply our specialized know-how to advance Cameco's integration in the nuclear fuel cycle," said Bernard Michel, Cameco's chair, president and chief executive officer. Cameco's processing plants currently produce refined UO₃ and provide uranium hexafluoride (UF₆) as feedstock for existing enrichment plants which use gaseous diffusion or gas centrifuge technologies.

"We are delighted to welcome Cameco to the AVLIS team," said USEC president and chief executive officer William H. Timbers, Jr. "Cameco brings a wealth of technical expertise as a major supplier of uranium refining and conversion services."

Following completion of the approximately two-year AVLIS feedstock demonstration project, the partners will assess the feasibility of proceeding to the construction of a full-scale production facility. The feasibility study will evaluate many factors including the plant location options and the regulatory approvals necessary to proceed with construction and commercial production operation.

"If the demonstration phase is successful and USEC proceeds with commercial development of AVLIS, the Cameco/USEC partnership would produce AVLIS feedstock using UO₃ from Blind River, consolidating Cameco's position in the uranium conversion sector," Michel said.

Cameco, with its headquarters in Saskatoon, Saskatchewan, is the world's largest publicly traded uranium company and a growing gold producer. It has uranium and gold mining operations in Saskatchewan, uranium processing facilities in Ontario and a gold mine under construction in Kyrgyzstan, Central Asia.

USEC, a global nuclear energy company, produces and markets uranium enrichment services to 64 utilities that own and operate commercial nuclear plants in 14 countries, including the United States. With its headquarters in Bethesda, Maryland, USEC manages gaseous diffusion plants in Paducah, Kentucky and near Portsmouth, Ohio and conducts AVLIS development and demonstration activities in Livermore, California. USEC operations include approximately 5,000 people. USEC is a US government corporation in the process of privatizing.

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