Layoffs coming: Brad Wall says Saskatchewan looking for more uranium markets

An aerial view of the Key Lake Cameco mine in northern Saskatchewan.
An aerial view of the Key Lake Cameco mine in northern Saskatchewan. Brad Wall says layoffs at Cameco uranium operations will hurt First Nations people. File Photo

Saskatchewan Premier Brad Wall says uranium industry layoffs in the province’s north are going to hurt First Nations people.

Cameco (TSX:CCO) said on Wednesday that it will temporarily suspend operations at its McArthur River mine and Key Lake milling operation by the end of January. About 845 workers are getting layoff notices.

READ MORE: Cameco shuts down production for 10 months at 2 Sask. sites, 845 jobs affected

Wall said about 48 per cent of Cameco’s employees are Indigenous.

“The gap between Aboriginal unemployment and overall unemployment persists,” Wall said Thursday.

“And when you have layoffs like this, even if they’re only temporary, obviously it’s going to disproportionately impact Aboriginal people who want to be a part of the workforce, and don’t we all. I mean that’s the difficulty today.”

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The suspension is planned to last 10 months, but more details are expected when Cameco’s fourth-quarter results are released in February.

Wall said the province will help workers get access to training, services and benefits, because the situation is “fairly traumatic, even for a temporary loss of job.”

He also said he has contacted Cameco and is taking the word of the CEO Tim Gitzel that the layoffs will be temporary.

“I don’t think he’s the kind of person that wants to raise expectations needlessly,” said Wall. “I trust him, is the bottom line, because of what he has said and also (because of) how they’ve have conducted themselves.”

READ MORE: Cameco reports Q3 loss of $124M, trims production forecast

Wall noted Cameco is also slashing its dividend. Cameco said the company’s annual dividend next year will be eight cents per common share, a reduction of 32 cents per common share on an annual basis.

The company announced third-quarter losses of $124 million on Oct. 27, one year after turning a profit of $142 million in the same quarter.

Low uranium prices are being blamed for the shutdowns.

Uranium prices have fallen by more than 70 per cent since an earthquake and tsunami in Fukushima, Japan, devastated a nuclear facility in 2011. They remain at unsustainably low levels and there is oversupply in the uranium market, Cameco said in the news release.

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Gitzel said there’s “no expectation of change on the immediate horizon.”

“To date, we have made good progress in reducing costs but unfortunately, given the continued market weakness, more needs to be done,” Gitzel said in the release.

“We can’t control the market so our focus is on positioning the company to weather the continued low uranium prices and have uncommitted, low-cost supply to deliver into a strengthening market.”

In the meantime, Wall said Saskatchewan will keep trying to open up markets for uranium in India and China.