Notes to Consolidated Financial Statements
For the years ended December 31, 2014 and 2013
|Beginning of year||$828,015||$18,295||$846,310|
|Changes in estimates and discount rates||26,348||58||26,406|
|Provisions used during the period||(10,848)||(959)||(11,807)|
|Unwinding of discount||21,098||330||21,428|
|Effect of movements in exchange rates||52,421||—||52,421|
|End of period||$917,034||$17,724||$934,758|
A. Reclamation provision
Cameco’s estimates of future decommissioning obligations are based on reclamation standards that satisfy regulatory requirements. Elements of uncertainty in estimating these amounts include potential changes in regulatory requirements, decommissioning and reclamation alternatives and amounts to be recovered from other parties.
Cameco estimates total future decommissioning and reclamation costs for its existing operating assets to be $974,785,000 (2014 – $874,314,000). The expected timing of these outflows is based on life-of-mine plans with the majority of expenditures expected to occur after 2021. These estimates are reviewed by Cameco technical personnel as required by regulatory agencies or more frequently as circumstances warrant. In connection with future decommissioning and reclamation costs, Cameco has provided financial assurances of $1,010,784,000 (2014 – $910,902,000) in the form of letters of credit to satisfy current regulatory requirements.
The reclamation provision relates to the following segments:
B. Waste disposal
The Fuel Services division consists of the Blind River refinery, Port Hope conversion facility and Cameco Fuel Manufacturing Inc.. The refining, conversion and manufacturing processes generate certain uranium contaminated waste. These include contaminated combustible material (paper, rags, gloves, etc.) and contaminated non-combustible material (metal parts, soil from excavations, building and roofing materials, spent uranium concentrate drums, etc.). These materials can in some instances be recycled or reprocessed. A provision for waste disposal costs in respect of these materials is recognized when they are generated.
Cameco estimates total future costs related to existing waste disposal to be $17,158,000 (2014 – $18,100,000). These outflows are expected to occur within the next three years.