COAL, URANIUM & OIL SANDS — Saskatchewan to entrench status as world uranium king

On paper, Saskatchewan’s three uranium development projects together are expected to produce more than 13,000 tonnes of U3O8 a year — about 14% more than Canada’s current annual production from existing mines. Whether they meet that goal may depend on how well project development works in practice.

The McClean Lake project, 20 km northwest of the Rabbit Lake mine and mill near Wollaston Lake, has suffered a series of setbacks in construction that has pushed back the proposed start date to the end of April. Operator Cogema Resources, which holds a 70% interest in the project, laid off 120 employees and suspended mining at the project’s Sue open pit in January (T.N.M., Jan. 25/99).

The development plan at McClean Lake would see ore from four deposits — McClean Lake, Midwest Lake, Sue and JEB — processed at the McClean mill. Cogema had planned to use the JEB open pit, from which the ore has already been mined and stockpiled, to store tailings from the mill.

Midwest Lake has reserves of 360,000 tonnes grading 4.5% U3O8, and the three other deposits together have 810,000 tonnes grading 2.8% U3O8. Annual production had been scheduled to start at 2,700 tonnes and ramp up to nearly 11,000 tonnes. Denison Mines (DEN-T) owns a 22.5% interest in the project, while OURD Canada, an arm of Japan’s Overseas Uranium Resources Development Co., owns 7.5%.

Progress has been smoother at the McArthur River project, where Cogema has a 16.2% interest and Cameco (CCO-T), the rest. Permits are in place, and both construction and underground development are on schedule.

At the end of 1997, McArthur River had reserves of 457,000 tonnes grading 18.74% U3O8, and an additional resource of 859,000 tonnes grading 12.02% U3O8. Cameco announced a 35% increase in McArthur River’s reserves in February but has yet to release new tonnage and grade figures.

Once production is under way, ore from McArthur River will be shipped to Cameco’s Key Lake mill, 80 km away by road. Annual production is expected to be just over 8,000 tonnes of U3O8.

The Key Lake mill, currently eating down a stockpile of ore from the Key Lake mine, is scheduled to shut down at the end of June. Cameco plans to modify the mill during the shutdown in order to accommodate the new feed from McArthur River. During that time, about 200 of the mill’s 300 employees will be on temporary layoff.

Next in the batting order is the Cigar Lake project, where Cameco has a 48.8% interest, and Cogema, 6.4%. The minority shareholders are Idemitsu Uranium Exploration, TEPCO Resources (part of the Tokyo Electric Power Co.), and the Korean Electric Power Corp.

The partners had originally planned to truck Cigar Lake ore to the McClean Lake mill, but the most recent proposal is to use Cameco’s Rabbit Lake mill, which had been scheduled to close. Mining at the three deposits that made up the Rabbit Lake project — Collins Bay A and B, and Eagle Point — has been suspended and the mill will operate at half-capacity until ore from Cigar Lake is available (probably in 2001 or 2002).

Cigar Lake, with reserves of 1.2 million tonnes grading 13.6% U3O8, is expected to produce about 2,700 tonnes of U3O8 annually.