McArthur River/Key Lake

  • McArthur River/Key Lake, located in northern Saskatchewan, Canada, are the world's largest high-grade uranium mine and mill.
  • In service since 1999 and 1983 respectively, Cameco operates the ISO 14001 certified locations, which have collectively produced 535 million lbs using a variety of mining methods.
  • After being held in safe care and maintenance since 2018, on February 9, 2022 Cameco announced plans for the operation’s gradual return to production, which was
    achieved on November 9, 2022.
Operation(As of December 31, 2021)
McArthur River Reserves(As of December 31, 2021)

2022 Q3 Update

Transition to planned production

McArthur River/Key Lake Production

Cameco's Share (million lbs)

Six months
ended September 30
   
2022 2021 Change 2022 Plan
-- -- -- up to 1.41

1 Over the course of 2022 and 2023, we will undertake all the activities necessary to ramp up to the 2024 planned production of 15 million pounds per year (100% basis) at McArthur River/Key Lake. In Q2, we updated our production forecast up to 2 million pounds of production (100% basis) this year (previously up to 5 million pounds) due to delays to our work schedule at the Key Lake mill. We continue to expect first production later in the fourth quarter.

In February 2022, we announced plans to transition McArthur River and Key Lake from care and maintenance to planned production of 15 million pounds per year (100% basis) by 2024. In the third quarter of 2022, there was no production as we continue to advance recruitment, training, infrastructure upgrades and operational readiness activities in preparation for restart. There are now approximately 730 employees and long-term contractors employed at the mine and mill.

Commissioning has been completed for all process circuits at the McArthur River mine, including the ore slurry load out facility, and transportation of ore slurry to the Key Lake mill has commenced. The initial material being shipped to the mill comes from the broken ore inventory that was mined prior to the site being placed in care and maintenance. Critical mining equipment and initial production areas have been prepared and are ready for new production. The Key Lake mill, has undergone significant upgrades, including a new computer operating system, installation of several automated systems and the incorporation of digital technology. We have been working through normal commissioning issues as we integrate the existing and new assets with the upgraded operating system. Commissioning activities are winding down and first production is scheduled for later in the fourth quarter. We continue to expect up to 2 million pounds of production (100% basis) this year.

For the remainder of 2022 and in 2023, we will undertake all the activities necessary to ramp up to the planned annual production of 15 million pounds (100% basis) by 2024. Our plans give us line of sight to a significant improvement in our future financial performance by allowing us to source more of our committed sales from lower-cost produced pounds and we will no longer be required to expense care and maintenance costs directly to cost of sales. However, until we achieve a reasonable production rate, we expect to incur between $15 million to $17 million per month in operational readiness costs, which will be expensed directly to cost of sales. There is a potential for the COVID-19 pandemic and related supply chain challenges to impact the availability of materials, reagents and labour, which could not only impact 2022 production but could also introduce risk to production in 2023.

Collective agreement

The collective agreement with the United Steelworkers Local 8914 expires in December 2022. During past negotiations, work has continued under the terms of the expired collective agreement while negotiations to reach a new agreement proceeded. There is a risk to the production plan if we are unable to reach an agreement and there is a labour dispute.

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Environment & Safety

Worker safety, environmental monitoring and proper decommissioning, after mining is completed, are of the utmost importance to Cameco.

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Reserves & Resources

Our mineral reserves and resources are the foundation of our company and fundamental to our success.

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Caution about forward-looking information

This page may contain forward-looking information that is based upon the assumptions and subject to the material risks discussed on page 2 of Cameco's most recent Quarterly MD&A.