Cameco Corp. announced it will shutter its long-running Rabbit Lake operation in Saskatchewan as the company tries to adjust to an extremely weak uranium market.
The shutdown will lead to roughly 500 job losses, Saskatoon-based Cameco said on Thursday night. The miner is also curtailing production at its U.S. operations, which will result in an additional 85 job cuts.
Cameco chief executive Tim Gitzel said these moves were unavoidable as the company needs to be prepared for a “lower-for-longer” scenario in the uranium business. “It was just a tough day for all of us here at Cameco and we’re thinking of our employees,” he said in an interview.
The company is ramping up production at its very low-cost Cigar Lake mine. That means it can meet its customers’ needs without the higher-cost output from Rabbit Lake, which is not sustainable at current uranium prices.
The job cuts are another blow to the Saskatchewan economy, which is already reeling from weak oil and potash prices.
Uranium has been in a vicious bear market since the Fukushima nuclear disaster in March 2011. Last week, the spot price dropped to an 11-year low below US$26 a pound. It was above US$130 at the peak of the market in 2007.
For the rest of this article, click here: http://business.financialpost.com/news/mining/cameco-to-shutter-rabbit-lake-mine-cut-500-jobs-due-to-weak-uranium-market