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Cameco to cut Cigar Lake operating costs; signs MoU with JV partners

Uranium producer Cameco Corp has signed a non-binding MoU with its JV partners at the Cigar Lake operation to mill all of its ore at the McClean Lake mill in a bid to cut operating costs.

(Reuters) - 

Cameco Corp said it signed a new milling arrangement with its joint venture partners which will help it cut operating cost at its Cigar Lake project.

Canada's top uranium producer said it signed a non-binding memorandum of understanding with its joint venture partners -- AREVA Resources Canada Inc, Idemitsu Resources Canada Inc and Tepco Resources Inc-- to mill all Cigar Lake ore at the McClean Lake mill.

Cigar Lake, located about 660 kilometres north of Saskatoon, is the world's largest undeveloped high-grade uranium deposit, according to Cameco's website.

The company said estimated average cash operating cost would drop to about $18.60 per pound from $23.14 per pound due to the new milling arrangement.

Cameco, which owns a 50 percent stake in the Cigar Lake project, said it continues to expect production to start in mid-2013.