- Uranium Resource Assessment
- Uranium Exploration Survey
- Uranium Production and New Developments
- Canadian Uranium Statistics - Fact Sheet
With the spot price for uranium continuing to increase over the past year to levels not seen for over two decades Canada's uranium mining sector is moving to increase production. On December 21, 2004, the Cigar Lake joint venture partners decided to complete all development necessary to proceed to production. An 18% increase in McArthur River production has also been proposed. The improving market has also created a surge in uranium exploration activity in Canada.
Production at the Cigar Lake mine is expected to begin in 2007. Cigar Lake is the site of the world's second largest high-grade uranium deposit discovered to date, with reserves amounting to some 90 000 tU at an average grade of 18% U. A ramp-up period of up to three years is expected before full annual production of some 7 000 tU is achieved.
Canadian uranium production in 2004 amounted to 11 597 tU, up some 11% from the 2003 total of 10 455 tU as production returned to full capacity at McArthur River following the repair of damage caused by water inflow in April 2003 that suspended production for 3 months. Canada retained its position as the world leader in uranium production, accounting for about 29% of 2004 global mine output.
Market conditions for uranium producers continued to improve in 2004, and the spot market price rose 43% - compared with a 42% increase in 2003. Supply constrictions, particularly for conversion services, continued to plague the market. The most noteworthy development on the demand side of the market was the emergence of China as a force in world uranium markets, as it turned to outside suppliers to meet its longer-term uranium needs for its burgeoning nuclear power program. Canadian uranium producers are well positioned to capitalize on this market upturn. The transition to new production centers mining high-grade, low-cost deposits in northern Saskatchewan is now nearly complete, and increased exploration activity will likely lead to the delineation of additional resources. With a policy environment supportive of the industry, Canada can be expected to maintain its status as a reliable and competitive supplier for many years to come.
In the latest assessment of uranium supply capabilities, Natural Resources Canada (NRCan) data indicate that Canadian uranium resources increased by some 3%, compared to 2004 (Table 1). The attached Fact Sheet provides additional information on Canada's uranium industry.
Exploration activity markedly increased in 2004. As in the past, a significant portion of the exploration continues to be undertaken in the Athabasca Basin of northern Saskatchewan, the principal target for the discovery of high-grade, low-cost, unconformity-hosted uranium deposits. This most recent surge has also led to exploration activity in other regions of the country, notably Nunavut and the Northwest Territories.
Uranium Resource Assessment
Estimates of Canada's known uranium resources, based on the results of an evaluation of company data, are critical components of NRCan's annual assessment of domestic uranium supply capabilities. As Table 1 indicates in more detail, Canada's recoverable uranium resources amounted to 444 000 tU as of January 1, 2005, up some 3% from the 2004 total of 432 000 tU due to recent discoveries and deposit appraisal exceeding depletion through mining. With over 80% of the resource base categorized as "low-cost", Canada is well positioned to continue its leadership in uranium production.
|Price Ranges within which Mineable Ore is Assessed2||Measured||Indicated||Inferred|
|Up to $50/kgU||270||252||288||17||81||10||85||44||86|
|Up to $100/kgU||0||0||0||58||37||37||14||18||18|
1 Actual or expected losses in mining recovery and ore processing have been accounted for; these factors were individually applied to resources tributary to existing or prospective production centres. In underground operations, mineable ore is generally 75 to 85 per cent of the ore-in-place; higher mining recoveries are achievable in open-pit operations. Ore-processing recoveries in Canada range from 90 to 99 per cent depending on ore type and grade; Canada's weighted average mill recovery for existing conventional uranium operations was 97 per cent during this period.
2 The Canadian dollar figures reflect the price of a quantity of uranium concentrate containing 1 kg of elemental uranium. The prices were used in determining the cut-off grade at each deposit assessed, taking into account the mining method used and the processing losses expected. The price of $100/kgU was used by NRCan to illustrate those resources that were of economic interest to Canada over this period.
$1/lb U3O8 = $2.6/kgU
Uranium Exploration Survey
The number of companies with major exploration programs in Canada has increased rapidly with the recent price increases, and reported expenditures amounted to some $44 million in 2004. Although a significant portion of this total was directed to the Athabasca Basin, a surge in exploration activity was reported in Nunavut, the Northwest Territories, Quebec, Newfoundland and Labrador, Alberta, Yukon, Ontario and Manitoba. Basic "grassroots" uranium exploration in Saskatchewan doubled from $13 million in 2003 to $26 million in 2004. The top three operators, accounting for significant proportion of the $44 million expended were: Cameco Corporation, COGEMA Resources Inc. (CRI), and UEX Corporation.
Uranium Production and New Developments
Uranium production in Canada totaled 11 597 tU in 2004 and producer shipments amounted to 11 545 tU. Canada's operating uranium production centers employed 985 workers in 2004.
Production increased to 7 035 tU in 2004 as damage caused by water inflow in 2003 was repaired. A detailed evaluation by the Canadian Nuclear Safety Commission (CNSC) concluded in 2004 that it is unlikely that there will be any negative effects on the health of the workers as a result of the doses received during the 2003 water inflow event and that there was no significant impact on either the treatment facilities or the environment. A union and employee organization, the Canadian Nuclear Workers Council, also concluded that there were no adverse consequences to miners from radiation exposure during the inflow incident. A proposal to increase annual production capacity by 18% (from about 7 200 tU to about 8 500 tU) at McArthur River and Key Lake is currently the subject of a screening level environmental assessment (EA).
The Key Lake mill produced a total of 7 200 tU in 2004, up from the 2003 total of 5 830 tU. A small contribution (165 tU) of total 2004 mill production was derived from Key Lake stockpiled mineralized waste rock that is used to lower the grade of McArthur River ore to produce a mill feed of about 3.4% U. A proposal to recycle uranium by-products from the Blind River refinery and the Port Hope conversion plant in the Key Lake mill is the subject of an ongoing screening level EA initiated in December 2002.
Production remained steady at 2 310 tU in 2004. Although the mill continues to be fed by stockpiled Sue C ore, CRI began preparations for open-pit mining of the Sue A and Sue E deposits in July 2005 and November 2005, respectively. In 2004, CRI began test mining small deposits using surface mining techniques. On March 24, 2005, the Supreme Court of Canada dismissed with costs an application to appeal the Federal Court of Appeal decision on McClean Lake licensing, bringing to an end this legal challenge.
Rabbit Lake produced a total of 2 087 tU in 2004, down slightly from the 2003 total of 2 280 tU, as difficult mining conditions reduced mill feed. Surface and underground exploration led to the delineation of 2 300 tU of probable reserves in 2004, extending mine life to 2007.
Production is expected to begin in 2007. Current plans call for initially processing all Cigar Lake ore at McClean Lake, and as Cigar Lake production ramps up to full capacity, just over half of final uranium processing is expected to be completed at the Rabbit Lake mill, subject to regulatory approval.
|"Known" Uranium Resources1 Recoverable from Mineable Ore (Thousands of metric tons of uranium as of January 1)||432||439||452||437|
Saskatchewan Production Centers
|Share of World Output (%)||29p||29||31||34|
|Total Ore Processed (Thousands of metric tons)||621||587||503||489|
|Average Grade of Ore Processed (kgU/t)||31.7||18||23.7||25.7|
|Domestic Reactor Requirements (tU)||1 700||1 400||1 400||1 400|
Total Producer [Domestic & Export] Shipments (tU)
Value of Shipments ($C millions; estimated from an average market price)
Average Price of Deliveries under Export3
Contracts ($C per kgU / $US per lb U3O8 - rounded values)
|Spot Sales Proportion3 [Deliveries under Export Contracts] (%)||NA||NA||NA||<2|
|Average Annual "NUEXCO" Spot Price4 ($US/lb U3O8)||18.65||11.56||9.88||8.84|
|Exports of Canadian-Origin Uranium (tU)||NA||8 558p||11 534||10 029|
|Uranium Exploration Expenditures5 ($C millions)||44||36||35||25|
|"Grassroots" Exploration in Saskatchewan ($C millions)||26||13||15||14|
|Employment as of December 31 (Mine + Mill + General)||985||965||972||973|
NA - Not Available
1The estimates of "known" resources [i.e., measured + indicated + inferred] represent tonnages recoverable from mineable ore at prices of $100/kgU or less.
2As reported by producers in April of each year. Total might not equal sum of components because of independent rounding.
3 Commencing in 2002, Natural Resources Canada has decided to suspend the publication of the Average Price of Deliveries under Export Contracts for uranium for a period of three to five years, pending a policy review and assessment of market conditions.
4 In 2001, applicable to the Restricted Market.
5 Includes advanced underground exploration and deposit appraisal expenditures, care-and-maintenance costs at new projects awaiting production approvals, and "grassroots" exploration expenditures in Canada.