Cameco cuts could be felt across Saskatchewan’s mining sector

SASKATOON – Cameco’s decision Thursday to halt production at a uranium operation in northeast Saskatchewan and cut 500 jobs will be felt throughout the province’s close-knit mining sector, according to an industry insider.

“It was a tough day for everybody in the industry,” Pam Schwann, president of the Saskatchewan Mining Association, said.

“We have a lot of migration from workers from one site to another whether it’s potash to uranium or vice versa.”

READ MORE: Cameco suspends Rabbit Lake mine production and cuts 500 jobs

Saskatoon-based Cameco suspended production at its Rabbit Lake operation, near Wollaston Lake. Company CEO Tim Gitzel said Thursday night that it was a “tough day” that was brought about by low uranium prices and an oversupplied market.

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“This is the mining business, it has its ups and downs, it’s unfortunate,” Gitzel said Thursday, after travelling to the site to personally inform employees of the decision.

The price of uranium has dropped roughly 63 per cent in five years. However, Cameco isn’t the only mining company dealing with a soft commodity market at the moment, according to Schwann.

“We’re seeing across all the sectors that the market conditions just aren’t supporting production levels,” Schwann said in an interview Friday.

“It’s just not feasible to keep putting out product when there isn’t the demand there… all the sectors are controlling their costs and really looking to their lowest cost facilities to optimize production.”

READ MORE: Province sending team to help Cameco workers losing their jobs

Around 150 employees will remain at Rabbit Lake to keep it in a safe care and maintenance state so it could re-start production if uranium prices go back up, according to Gitzel. The other 500 workers would either be repositioned within the company, or offered exit packages, he said.

“This is a suspension of operations, it’s not a closing down,” Schwann said.

“The demand for uranium will rise; we’ve got 60 nuclear power facilities that are currently under construction.”

Gitzel added on Thursday that despite the cuts, Cameco will operate in Northern Saskatchewan “for the long run.”