Welcome to the Cameco Corporation HUB on AGORACOM
Cameco's vision is to be a dominant nuclear energy company producing uranium fuel and generating clean electricity. Our key strategy to deliver this vision is to sustain and grow uranium production in a way that is safe, clean, cost-effective and communit
Cameco is involved in four business segments:
- uranium,
- fuel services,
- nuclear electricity generation, and
- gold.
In 2008, we extended our involvement in the nuclear fuel cycle with an investment in the development of a third-generation uranium enrichment process. Testing of the innovative technology is planned to begin in mid-2009.
The only significant commercial use for uranium is to fuel nuclear power plants for the generation of electricity. In recent years, nuclear plants generated about 15% of the world's electricity.
The major stages in the production of nuclear fuel are uranium exploration, mining and milling, refining and conversion, enrichment and fuel fabrication. Once a commercial uranium deposit is discovered and mineral reserves delineated, regulatory approval to mine is sought. Following regulatory approval, the mine is developed, and ore is extracted and processed at a mill to produce uranium concentrates. Mining companies sell uranium concentrates to nuclear electricity generating companies around the world on the basis of the amount of uranium (U3O8) contained in the concentrates. These utilities then contract with converters, enrichers and fuel fabricators to produce the required reactor fuel.
Uranium
Cameco is one of the world's largest uranium producers, accounting for approximately 15% of the world's production in 2008 with about 500 million pounds of proven and probable mineral reserves of uranium. We have controlling ownership of the world's largest high-grade uranium mineral reserves and low-cost operations located in northern Saskatchewan. Cameco operates four mines located in Canada and the United States, and has two mines under development, one in Canada and the other in Kazakhstan.
Fuel Services
The company is an integrated uranium fuel supplier with refining facilities at Blind River and fuel services facilities (conversion and fuel manufacturing) at Port Hope and Cobourg, all located in Ontario, Canada.
The Blind River facility refines uranium concentrates into uranium trioxide (UO3), an intermediate product in the uranium conversion process. Our Port Hope conversion services plants chemically change the form of the UO3 to either uranium hexafluoride (UF6) or uranium dioxide (UO2). The Port Hope UF6 plant has the licensed capacity to produce about 20% of the world's annual requirements of UF6 used in making fuel for light water reactors. In 2005, Cameco signed a toll-conversion agreement to acquire UF6 conversion services from Springfields Fuels Ltd. (SFL) in Lancashire, United Kingdom. Under the 10-year agreement, SFL will annually convert a base quantity of up to 5 million kilograms of uranium (kgU) as UO3 to UF6 for Cameco. This arrangement increases our UF6 conversion capacity by 40%. In addition, Port Hope is the world's only commercial producer of natural UO2, the fuel used by all Canadian-designed Candu reactors.
Cameco manufactures fuel bundles for use in Candu reactors and participates in all stages (from uranium exploration and production to fuel fabrication) of the Candu nuclear fuel cycle.
Enrichment
On June 20, 2008, Cameco entered an agreement with entities owned and controlled by General Electric (GE) and Hitachi Ltd. whereby we provided $124 million (US) in cash and issued a promissory note in the amount of $73 million (US) to acquire a 24% interest in Global Laser Enrichment LLC (GLE), a uranium enrichment development company based in Wilmington, North Carolina. The promissory note represents Cameco's support for future development of the business. The remainder of GLE is owned indirectly by GE (51%) and Hitachi Ltd. (25%). We do not expect to incur further development and commercialization expenditures before 2010. GLE is developing a third-generation uranium enrichment process using laser technology to commercially enrich uranium for nuclear power plants. In 2009, the test loop phase is planned. This is the next important milestone for the technology, which is intended to verify performance and reliability data necessary to support the construction of a commercial-scale enrichment facility. In June 2008, when the agreement was announced, GLE expected to achieve commercial production in 2013. GLE will be responsible for marketing all the enrichment services from this plant. The target annual capacity of the proposed commercial facility is between 3.5 and 6.0 million separative work units.
Uranium enrichment is a key step in the process of producing fuel for light water nuclear power plants. Naturally occurring uranium is made up of two isotopes, approximately 99.3% U-238 and 0.7% U-235. Uranium enrichment is the process that increases the U-235 concentration from 0.7%. Most commercial reactors require uranium fuel to have a U-235 content of 3% to 5%.
Nuclear Electricity Generation
Cameco generates clean electricity through its 31.6% interest in the Bruce Power Limited Partnership (BPLP), which operates the four Bruce B nuclear reactors and manages the overall site located in southern Ontario. We are the fuel procurement manager for uranium, conversion services and fuel fabrication for BPLP's four B nuclear reactors and for the two operating Bruce A reactors. Cameco provides 100% of the uranium concentrates for BPLP and under an agreement executed in 2008, we have agreed to supply Bruce Power A Limited Partnership (BALP) with the majority of its future uranium concentrates requirements. Cameco also supplies BPLP and BALP with all of their conversion services and fuel fabrication requirements. BPLP's four B reactors have a combined net generation capacity of about 3,260 megawatts (MW), supplying about 15% of Ontario's electricity.
Gold
Cameco has a 52.7% interest in Centerra Gold Inc. (Centerra), which began trading on the Toronto Stock Exchange (TSX) in June 2004. Cameco transferred substantially all its gold assets to Centerra as part of the strategy to maximize the value of those assets. Centerra is a growth-orientated Canadian-based gold producer focused on acquiring, exploring and developing gold properties in Central Asia, the former Soviet Union and other emerging markets. Centerra operates two gold mines located in the Kyrgyz Republic and Mongolia. Gold is not a core business for Cameco. Centerra was created as a vehicle for Cameco to eventually exit the gold business.