Cameco’s Millennium Mine project is on hold and with it, 50m lbs of uranium. Specifically, the uranium industry’s largest producer has withdrawn its application to build and operate the new underground uranium mine in northern Saskatchewan. The company can (and no doubt will) ask the Canadian Nuclear Safety Commission to consider its license application at a later date but for now the mine will not be moving forward.
Any delay in future production is good for Fission. This is particularly so when the delay relates to underground mines which are expensive to build and expensive to run. In comparison, PLS has the type of depths normally associated with an open pit mine. Measured against underground mining, open pit operations are quick to build, cost-effective to operate and have the ability to turn production up and down as needed. In other words, when it comes time to increase production capability, open pit mines are going to be very attractive to producers.
It’s also worth noting that Cameco’s profit is up for Q1, 2014. That’s not a coincidence. Putting a costly future mine on hold is about positioning themselves for when the fundamentals of the nuclear sector push the uranium market upwards. I’ll be blogging more on this subject shortly but for now let me reiterate two points: Japan is taking longer to restart their reactors than many expected but restart they will. Also, the number of reactors under construction and the even larger number currently going through the planning and proposal stages means we are ultimately looking at a net growth in reactors over the long term.
In the meantime, Fission’s technical team is continuing to prep for the upcoming summer drill program. We also still have a lot of assays to come from our highly successful winter program, which connected five zones and extended the strike length to 2.24km, so keep a sharp eye out for news as the results come back from the lab.
Dev Randhawa, CEO of Fission Uranium
