Message from our CEO
I am pleased to share our 2022 Environmental, Social and Governance (ESG) Report. We take this opportunity to reflect on our performance from the previous year and communicate our targets for the year ahead. I hope these pages demonstrate how serious and committed we are to advancing our ESG performance at Cameco.
In 2022, geopolitical events deepened concerns about energy security, and coupled with the ongoing focus on the climate crisis, created the conditions for what we believe is transformative change in the nuclear power industry and our business. Unrest in Kazakhstan at the beginning of 2022 raised concerns about the more than 40% of global uranium supply that originates from that country. However, it is the tragic ongoing Russia-Ukraine war that has not only brought about human suffering and societal upheaval but has resulted in economic impacts felt around the globe and a realignment in energy markets. This realignment is highlighting the increasingly important role for nuclear power not just in providing clean energy, but also providing secure and affordable energy. And, with the global nuclear industry reliant on Russian supplies for a significant portion of its uranium concentrates as well as conversion and enrichment services, it is highlighting the security of supply risk associated with the growing primary supply gap and shrinking secondary supplies with an increasing focus on origin of supply.
The uncertainty about where nuclear fuel supplies will come from to satisfy growing demand led to increased long-term contracting activity in 2022 and price increases across the nuclear fuel cycle. Notably, utilities’ annual contracting activity is getting closer to the rate required to replace what is being consumed annually, which has not occurred in over a decade. Therefore, we expect there will be continued competition to secure uranium, conversion,and enrichment services under long-term contracts with proven producers and assets in geopolitically attractive jurisdictions, with strong ESG performance and on terms that will ensure the availability of reliable supply to satisfy demand.
In 2022, we began the restart of production at our McArthur River/Key Lake operations, which had been on care and maintenance since 2018. With the improvements in the market and in alignment with the significant long-term contracting success we had during the year, we updated our 2024 production plans, adding 3 million pounds (100% basis) at the McArthur River/Key Lake operations and 4.5 million pounds (100% basis) at the Cigar Lake mine. In addition, we increased our interest in our Cigar Lake mine from 50 to 54%. We also entered into a strategic partnership with Brookfield Renewable Partners to acquire Westinghouse Electric Company, a global provider of specialized technologies, products, and services across most phases of the nuclear power sector. I am excited about what all these opportunities will mean for our people, our local communities, and our shareholders.
Although global and company efforts are geared towards avoiding the most devasting consequences of climate change, extreme weather events continue to increase in frequency and to impact Western Canada. In 2022, Cameco deepened its understanding of potential climate-related risks to our business. We worked with third-party experts to conduct a detailed analysis of our exposure to climate hazards and to model the impacts of climate on our northern Saskatchewan operations. We plan to extend this analysis to our other sites in the next few years, validate our current mitigation plans, and develop mitigation plans across our operations.
As decarbonization efforts are ramping up, the world continues to look for sources of clean energy. If countries and companies are serious about decarbonizing and realistic about the scale of their ambitions, I am convinced that nuclear energy must be part of the solution. While nuclear energy is already a reliable and zero-emissions energy source, Cameco wants to do more to help reduce emissions in the uranium value chain by working to reduce our own operational GHG emissions. As a milestone towards our long-term net-zero ambition, we have set a target to reduce our absolute Scope 1 and Scope 2 GHG emissions by 30% by 2030, from a 2015 base year. We are already investing in efficiency initiatives and will continue to look at new technologies that align with our decarbonization pathways.
Cameco continues to invest in our people by providing training to build skills and competencies. For example, to help employees develop their technology skills, we provide access to Cameco’s Digital Learning Centre, an online portal with a wide array of digital-themed courses, presentations, and podcasts from upskilling basic digital skills to software development. Cameco also continues to build capacity in northern Saskatchewan communities by providing training and work placements to local residents that enhance industry and digital knowledge.
I believe a company is nothing more than its people, and I continue to be proud of everything we have collectively achieved this past year. At the same time, I am disappointed that we did not meet all our safety targets. Although our safety performance has improved significantly over the last decade, we must focus on continuing to improve. We move forward with a renewed focus on safety. I am personally committed to reminding everyone at Cameco that “no job is so important that we cannot take the time to do it safely.”
Looking forward, I am excited about the growing momentum for nuclear energy and eager to see what we can accomplish together. I would like to thank our board of directors for their strong oversight and the trust and confidence shown as we take on new opportunities. I also want to welcome back so many of our rehired employees at McArthur River/Key Lake and thank all our employees who have chosen to join or stay with us over the last several years – your dedication continues to contribute to our vision of energizing a clean-air world.
President and Chief Executive Officer