Cameco Seals Leak, Resumes Dewatering At Cigar Lake

VANCOUVER — Cameco (CCO-T, CCJ-N) has resumed its efforts to dewater the Cigar Lake mine workings in Saskatchewan after remediating the source of an inflow that flooded the advanced uranium project in August 2008.

Construction started at Cigar Lake in 2005 and the high-grade uranium mine was originally slated to go into production in 2007. That timeline was forced back to 2011 after an initial flood in 2006. Cameco remediated the cause of the first flood and started dewatering the mine.

Then, 14 months ago, a fissure located in the top of a tunnel on the 420-metre level of the mine thwarted Cameco’s dewatering efforts, bringing water into the developing mine more quickly than the company could pump it out.

The mine reaches to 500 metres depth. After the 2008 flood, Cameco said it had to let the waters rise to the 100-metre level to monitor groundwater conditions. Once it determined the cause of the flood, the company drilled holes from surface, placed an inflatable seal between the shaft and the fissure, and then closed off the entire development behind the seal with grout and concrete. The 420-level is not part of future mine plans.

Cameco says it will need another six to 12 months to dewater and secure the mine, with the exact time dependent on the condition of the shaft and workings.

Cameco owns half of Cigar Lake. French energy giant Areva (ARVCF-O) owns the rest. The mine will tap into the world’s largest undeveloped high-grade uranium deposit, home to 226.3 million proven and probable lbs. U₃O₈ averaging 20.7% U₃O₈.

In recent months, Cameco shares have ranged from $28 apiece to $32, the high end of their 52-week range of $15.15-33.43. The company has 393 million shares outstanding.