Cogema, partners approve McClean Lake uranium mine

Having received approval for development from federal and provincial governments, Cogema Resources has decided to proceed with the McClean Lake uranium project in Saskatchewan.

The company and its partners will spend $250 million to construct the mine and milling facilities, 210 miles north of La Ronge.

The McClean Lake joint venture project is owned 70% by Minatco, a wholly owned subsidiary of Cogema, 22.5% by Denison Mines (TSE) and 7.5% by OURD Canada, a wholly owned subsidiary of Japanese-based Overseas Uranium Resources & Development.

The initial discovery of what was later to become the McClean orebody was made in January, 1979. Between 1982 and 1990, six other uranium deposits — including the JEB and Sue A, B and C — were discovered and delineated with 100,000 metres of drilling. Total known minable reserves now stand at 50 million lb. U3O8 averaging 2.8% uranium. Potential for additional reserves is said to be excellent, and exploration is continuing.

The development plan for McClean Lake calls for construction of a permanent camp, water treatment plant and mill offices starting this April. Open-pit mining of the JEB deposit will start later this October, and should continue until the end of 1996, when the orebody will be exhausted.

Construction of the mill will start in 1996 and should be finished by the second half of 1997.

After the JEB stockpile is depleted, ore for the mill will be mined from the Sue C deposit. The JEB pit will then be rehabilitated and turned into a tailings disposal facility.

The mill, which is expected to produce 6 million lb. of uranium per year at peak capacity, will be commissioned during the second half of 1997. It is expected to be running at full capacity by 1998, and the mine is expected to operate for 15 years.

The project will employ more than 250 people during the construction phase, and more than 200 operating jobs will be created when the mill starts up. This is the first uranium mine to open in Saskatchewan in 13 years. Last fall, a joint federal-provincial panel approved the plan to develop McClean Lake, as well as the Janine Extension project near Cogema’s Cluff Lake mine. The Midwest project, also considered by the panel, was not approved. Cogema owns, or has interests in, all of these Saskatchewan projects. Its Cluff Lake mine has reserves of 236 million lb. of U3O8 averaging 0.7% uranium and produces, on an annual basis, 2.25 million lb. of U3O8, or 955 tons of uranium.

Cogema also holds a 16.2% interest in the McArthur River project (where reserves are estimated at 260 million lb. U3O8 averaging 5% uranium) and the Midwest project (which contains 35 million lb. U3O8 averaging 4.5% uranium). In addition, Cogema has a 36.4% interest in the Cigar Lake operation, which has reserves of 285 million lb. U3O8 averaging 14.2% uranium, and other reserves of 100 million lb. U3O8 averaging 4.7% uranium.