French uranium giant Areva says it has secured approval to nearly double production of the nuclear fuel at its McClean Lake mill in northern Saskatchewan. The company said Tuesday that the Canadian Nuclear Safety Commission gave the go ahead to increase production at the mill from 13 to 24 million pounds a year.
The higher capacity will allow Areva to process more material coming from the Cigar Lake uranium mine, half owned by Cameco (TSX:CCO), as it ramps up production to 18 million pounds a year.
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The increase in allowed capacity comes as the uranium industry faces continued depressed prices and oversupply.
Cameco said in April that it was shuttering its Rabbit Lake uranium mine and cutting 500 jobs in the process in response to markets conditions.
Areva owns 70 per cent of the McClean Lake mill, with Denison Mines Corp. owning 22.5 per cent and OURD Canada Co. Ltd. the remaining 7.5 per cent.