No Production in 2011 for Cigar Lake!Cameco Corporation: No Production in 2011 for Cigar Lake!
Posted By Uranium Stocks On February 16, 2009 @ 9:04 pm In Uranium Mining Stocks | No Comments
The ingress of water at Cigar Lake continues to beproblematic as Cameco anticipates that production from this project issomewhere beyond 2011. How far beyond 2011 is not clear as this type ofwork presents engineers with an enormous and complex task.
From Cameco’s February 13, 2009 Report entitled RecordAnnual Revenue and Earnings for 2008 an update on Cigar Lake is givenas follows along with the above diagram:
We have confirmed that the main source of the increased waterinflow observed on August 12, 2008, is from a fissure located in thetop of the tunnel on the 420 metre level.
Cameco has developed a remediation plan to seal the tunnel. The planincludes remotely installing bulkheads on either side of the inflowlocation and then injecting concrete and grout into the tunnel andultimately into the rock through holes drilled from surface. Theequipment necessary to accomplish this has been mobilized and someinitial work both on surface and on the 420 metre level has started.The work on the 420 metre level involves removal of pipes, doors,ventilation ducting, loose sand and other miscellaneous items. This isbeing done using submersible, remotely operated vehicles (ROVs) thatare commercially available for this type of work. We estimate thatsealing of the August 12, 2008, inflow will take most of 2009.
During the fourth quarter, dewatering of shaft 2 commenced. Thewater level was pumped down to the 260 metre level and held there forseveral weeks. The inflow measured during this time was very low andstable, confirming that the sources of the inflow have been sealed. Inpreparation for further lowering the water level, the installation ofventilation and water pumping infrastructure began in the shaft. It isanticipated that the removal of all water in the shaft will be completein the second quarter of 2009.
Cameco has incurred $359 million in capital costs to developCigar Lake to the end of 2008. We no longer anticipate production in2011 and are assessing the impact of the August 2008 inflow on theplanned production date and capital cost estimate. We will provide newestimates, after the mine has been dewatered, the condition of theunderground has been evaluated, and the resulting information has beenincorporated in a new mining plan.
In addition to capital costs, Cameco’s share of remediationexpenses is now expected to total $92 million, of which $46 million hasbeen expensed to the end of 2008. In 2009, Cameco expects to spend $21million on remediation expenses for Cigar Lake.
In order to keep our stakeholders informed on the progress ofremediation activities, we will provide updates with each quarterlyMD&A or more frequently if there are significant developments.