by Greg Klein | February 8, 2016
A maiden resource made a high-grade but shy debut in Cameco Corp’s (TSX:CCO) Q4 report on February 5. Buried under other news was an announcement that Fox Lake now has an inferred 386,700 tonnes averaging 7.99% for 68.1 million pounds U3O8. Cameco’s 78.24% share comes to 53.3 million pounds. Partner AREVA Resources Canada gets the rest.
It’s an unconformity deposit but further details including cutoff grade and depth have yet to be disclosed, company rep Carey Hyndman tells ResourceClips.com. Fox Lake comprises part of the Read Lake project adjacent to the McArthur River mine in Saskatchewan’s southeastern Athabasca Basin. A focus of this year’s exploration plans, Read Lake will get about $7 million of a $36-million regional exploration budget for 24 properties in Canada and Australia.
… it’s those world-class, low-cost mines that will position us to quickly respond when the market calls for more production. And we believe that the question is not if the market will make that call, but when, as we continue to see a bright long-term outlook for the nuclear industry.—Tim Gitzel, president/CEO of Cameco Corp
Fox Lake largely accounted for an increase in Cameco’s portfolio-wide share of inferred resources, up 69.9 million pounds to total 381 million by year-end. Measured and indicated fell 1.8 million pounds to 377 million, while proven and probable reserves dropped 19 million pounds to 410 million.
Year-end revenue slipped 15% over 2014 to $2.75 billion, gross profit rose 9% to $697 million and net earnings attributable to shareholders fell 65% to $65 million or $0.16 per share.
Among the causes were the weaker Canadian dollar and lower tax recoveries, partly offset by lower impairment charges and higher uranium prices. Net earnings for 2014 were skewed by the $127-million sale of Bruce Power and a $66-million settlement with a customer.
The company took a $210-million Q4 impairment for Rabbit Lake, noting “increased uncertainty around future production sources for the Rabbit Lake mill.”
“We are still waiting on a market recovery that was expected to come sooner,” conceded president/CEO Tim Gitzel. “But we’ve learned to put those expectations aside and prepare for whatever comes our way. Looking ahead, our strategy is to continue focusing our capital on tier-one assets because it’s those world-class, low-cost mines that will position us to quickly respond when the market calls for more production. And we believe that the question is not if the market will make that call, but when, as we continue to see a bright long-term outlook for the nuclear industry.”