Areva begins processing uranium from Cameco’s Cigar Lake
French nuclear group Areva SA (EPA:AREVA) has begun processing uranium ore at its Canadian mill at McClean Lake, bringing a new source of the radioactive metal to market after delays.
The mill, located northern Saskatchewan, has been undergoing modifications since 2010 to allow it to process ore from Cameco’s (TSX:CCO), (NYSE: CCJ) $2.6 billion Cigar Lake mine, which is set to become one of the world’s biggest by 2018.
The facility is expected to produce up to 1 million pounds of uranium concentrate from Cigar Lake ore this year and ramp up to 18 million pounds by 2018.
The firm first expected to open Cigar Lake in 2007, but two floods pushed the launch of the mine well behind schedule.
Cameco, the world's third-biggest uranium producer, finally resumed operations last month and has delivered 1,400 tonnes of ore to McClean Lake so far.
Areva also said it would scale back originally envisaged investments and increase the sale of non-strategic assets as the firm sought to shore up its financial resources.
The 87%-state-owned firm announced it would cut planned capital expenditure by US$252 million over the next two years.
Areva added it would also dispose of $570 million' worth of non-strategic assets and minority stakes by the end of 2016. The firm has already sold $1.5 billion in assets since 2011, when a large restructuring program began.
Image courtesy of Cameco.