Investors in uranium miner Cameco (TSX: CCO), (NYSE: CCJ) are anxiously waiting for the company’s Q3 results, to be released Wednesday, as the firm it is expected to provide a timeframe for initial production at its Cigar Lake project located in the uranium rich Athabasca Basin of northern Saskatchewan.
But the market may not receive the news it’s hoping for, as the Canadian miner —which already announced a production delay until beginning of next year, with ore processing starting only in mid-2014— may now postpone the start of its Cigar Lake mine once again, reports Financial Post.
While construction was 97% complete as per September, demand for the nuclear fuel isn’t ramping up as expected. Japan, a major uranium user, has been slow to restart nuclear operations after the 2011 earthquake and tsunami that devastated the Fukushima Daiichi power plant, and stockpiles of U3O8—the most actively traded compound of uranium—keep growing.
Demand for the North American and European market, the two biggest nuclear-power producers, isn’t positive either. The shale boom in U.S. and Canada has lowered the price of natural gas, giving utilities in those countries other options for generating electricity. In Western Europe, negative sentiment toward nuclear energy since the Fukushima disaster is creating obstacles for utilities.
For years, Canada was the world’s largest uranium producer, accounting for about 22% of world output, but in 2009, was overtaken by Kazakhstan. Currently the country’s production comes mainly from the McArthur River mine, in northern Saskatchewan, the largest in the world. But the country is hoping that once Cigar Lake begins production, it will regain its throne in the uranium market.
