More trouble for Cameco at Port Hope (September 29, 2008)

Cameco (CCO-T, CCJ-n) has been given the green light to restart operations at its Port Hope uranium hexafluoride conversion plant — which was shut down in July 2007 when contaminated soil was found beneath the plant — but the company might have to close the plant again within a month.

Cameco’s supplier of hydrofluoric acid (HF) has terminated its contract, leaving the company without the key ingredient needed to produce uranium hexafluoride (UF6).

The company has enough HF to resume operations at a reduced rate for the next month but has not yet located an alternate supplier. The previous supplier is willing to ship HF to the Port Hope plant, but for a significantly higher price.

Cameco claims the supply company wrongfully terminated the contract and is looking for another seller, but HF is not available on a spot basis nor is it readily available or deliverable without a preapproved transportation plans.

The company says remediation costs for contamination at the plant will total about $50-55 million; about $20 million (including $17 million in 2007) will be expensed and the remainder capitalized.

The money was spent on the investigation of the cause and effects of the subsurface leakage, to rehabilitate the plant and install a system of wells that collect impacted groundwater in the area surrounding the plant and the harbour.