Cameco Corporation - President and CEO, Tim Gitzel
President and CEO, Tim Gitzel
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  • Cameco (TSX:CCO) has announced that it will extend the suspension of its Cigar Lake uranium mine as COVID-19 continues to spread
  • The company put the site on a care and maintenance schedule on March 23 this year, and it will now remain suspended until further notice
  • Given the rapidly developing pandemic, Cameco is also withdrawing its outlook for 2020
  • As of December 31, 2019, the company had approximately C$1.2 billion in cash
  • Cameco (CCO) is currently up 0.39 per cent to $12.87 per share, with a market cap of $5.09 billion

Cameco (TSX:CCO) has announced that it will extend the suspension of its Cigar Lake uranium mine as COVID-19 continues to spread.

Located in northern Saskatchewan, the Cigar Lake site is operated by Cameco, which owns a 50.025 per cent stake. The remaining ownership is split between Orano Canada, Idemitsu Canada Resources and TEPCO Resources.

A care and maintenance schedule was announced for the mine on March 23 this year, and was originally due to last four weeks. However, with the COVID-19 pandemic continuing to escalate, Cameco has made the decision to leave the site at a reduced operational level until further notice.

The company says that a number of critical factors were considered before reaching the decision, including continued government-mandated restrictions, concerns among leaders in remote communities, and the challenges associated with maintaining social distancing with a full workforce.

Ore from Cigar Lake is mined at Orano Canada’s McClean Lake mill, which has also been subjected to an extension of its care and maintenance schedule.

Tim Gitzel, CEO of Cameco, said that the global challenges posed by the pandemic are not improving, and are instead worsening.

“We therefore need to stay vigilant and do everything we can to keep people and families safe.

“We are especially sensitive to the situation in the remote, isolated communities of northern Saskatchewan that are home to a sizeable portion of the workforce at Cigar Lake,” he added.

In addition to the continued suspension of operations at Cigar Lake, Cameco announced that it would be withdrawing its outlook for 2020.

The company said that the rapidly evolving COVID-19 pandemic has resulted in a vast number of “moving pieces” and that an updated outlook would be provided once a clearer path is identified.

“Despite the current uncertainties as a result of the COVID-19 pandemic, we expect our business to be resilient.

“With many governments and communities declaring states of emergency in their jurisdictions, our utility customers’ nuclear power plants are part of the critical infrastructure needed to guarantee the availability of 24-hour electricity to run hospitals, care facilities and essential services,” Gitzel concluded.

As of December 31, 2019, Cameco had a strong balance sheet, with approximately C$1.2 billion in cash and a further $1 billion undrawn on its credit facility.

Cameco (CCO) is currently up 0.39 per cent to $12.87 per share at 10:41am EST.

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