Construction at Cameco Uranium Mine Delayed at Least a Year After Rock Slide

Cameco Corp., the world’s largest producer of uranium, on Monday said it will delay construction at its Cigar Lake mine by at least a year after a rock slide caused water to flow into the underground development.

The mine was originally slated to start production in early 2008.

Cameco, based in Saskatchewan, Canada, said it temporarily evacuated nonessential workers from the site in the northern part of the province after the incident began Sunday afternoon. There were no injuries or environmental damage, the company said.

Cameco plans to supply an estimated construction schedule and production start date once it restores access to the area. The company said it will also update capital cost estimates — now expected to be significantly higher — and production forecasts at that time.

The company noted that it has “interruption” protection built into most of its contracts, which allow it to reduce or cancel volumes if there is a meaningful shortfall in planned production.

Cameco says the Cigar Lake project, about 660 miles outside of Saskatoon, Saskatchewan, is the world’s largest undeveloped high-grade uranium deposit with proven reserves of more than 232 million pounds. Production life is estimated at 20 to 30 years. Some 650 workers are employed there during the construction phase.

Shares of Cameco sagged in midday trading, slumping $1.96, or 5 percent, to $36.15 on the New York Stock Exchange.