Cameco swept away by McArthur River flood

Cameco was the biggest newsmaker over the April 9-15 report period, announcing a possible suspension to production at the McArthur River mine in Saskatchewan. A shutdown translates into $4-5 million a month in lost profits.

Since early April, the uranium producer has been battling an underground water breech that was supposed to take two weeks to plug. However, the water is pouring in the workings a lot faster than first anticipated, and Cameco says it now has just two weeks to prevent the submergence of production levels.

The dreary update did not sit well with investors, who vented their anger by knocking $6.23 off the major’s shares before the period’s close. Cameco ended the week at $31.75, or 16% lighter; however, by presstime, it had recovered $1.23.

Also making headlines was Placer Dome, which announced plans to develop the Turquoise Ridge mine in Nevada. What’s more, the company received title to the historic Pueblo Viejo mine in the Dominican Republic and boosted resources at the advanced Donlin Creek project in Alaska. Placer climbed 14 on the news, finishing at $14.29.

Canada’s other two major gold producers were up as well: Barrick Gold tacked on 8 to end the period at $22.29 and Kinross Gold jumped 43 to finish at $8.77. Likewise, Goldcorp rose 24 to $15.38, helping push the Toronto Stock Exchange’s gold sub-group up 2.77 points to 155.88.

Inco dominated the base metals sector, rising 80 as investors eagerly awaited first-quarter results and as metal traders pushed spot nickel up US20 in overseas trading. On April 16, the major rose to the occasion, reporting earnings of $30 million for the first three months of the year — over twice as much as it earned a year ago. The increase reflects stronger growth in the stainless steel market and weaker scrap supply.

Cross-town rival Falconbridge was not as lucky, slipping 39 to $15.56; however, by presstime, it had recouped 14. The company was to release its first-quarter results on April 17.

Overall, the TSE’s diversified metals and mining sub-group was off 2.94 points at 117.65.

Junior Tahera was the most active issue, slipping 2 on a volume of 9.5 million shares. The loss came despite the placing of a higher valuation on diamonds recovered from the Jericho property in Nunavut, suggesting some are weary of the need for the project’s re-evaluation.

Wheaton River Minerals also saw some heavy trading after reporting the sale of its Guitarra silver-gold mine and the joint-venturing of its similar Ventanas project in Mexico. Wheaton recently bought a 25% stake in the Bajo de la Alumbrera copper-gold mine in Argentina, as well as a full interest in the Peaks gold mine in Australia, and is seeking another 12.5% stake in Alumbrera. Guitarra’s buyer, Vancouver-listed Genco Resources, need cover only 2% of Guitarra’s US$5-million price tag in cash.