Cameco makes production plans for Cigar Lake uranium project

The Cigar Lake uranium project in northern Saskatchewan is expected to enter development in 1997.

The bulk of the ownership is shared between Cameco (TSE) with 48.7% and Cogema Resources with 36.4%. The orebody contains an estimated 385 million lb. of uranium at an estimated grade of 9% U3O8, making it the world’s largest high-grade uranium deposit.

An agreement calls for ore to be trucked 80 km to the mill at the McClean Lake project, currently being developed by Cogema. McClean Lake, which is owned 70% by Cogema and 22.5% by Denison Mines (TSE), features five orebodies that contain an estimated 50 million lb. averaging 3.28% U3O8.

The milling and tailings facilities at McClean Lake have already received environmental approval, and by using them, Cameco will be able to save considerably on capital costs.

In order to accommodate ore from Cigar Lake, milling capacity at McClean Lake will be boosted to 24 million lb. U3O8 from the present capacity of 6 million lb. The Cigar Lake venture will have the right to produce up to 18 million lb. of U3O8, while McClean Lake will be able to produce 6 million lb. U3O8.

The total cost of developing Cigar Lake and expanding the McClean Lake mill is estimated at $410 million.

Since test mining was completed last year, Cigar Lake has been closed so that an environmental impact statement (EIS) could be prepared. The EIS will be reviewed this year at public hearings.

Final approval is expected in 1997, after which time Cameco would act as operator.