Investcom
Bookmark and Share

Metals & Mining : Home Uranium
Sector Focus >>  Gold  Uranium  Silver  Diamond  PGM  Base Metals  Industrial Minerals

Athabasca Basin, Saskatchewan  

Chart
Ux   U3O8 Price

(The Ux Consulting Company, LLC)
 
 
Athabasca Basin News
Enlarge Athabasca Basin Map
Region Overview
In Canada, the Athabasca Basin that straddles the Alberta-Saskatchewan border is considered one of the most favourable places in the world for exploring and mining uranium. The Athabasca Basin occupies an area of about 100,000 sq km in northern Saskatchewan accounts for approximately 30% of global primary uranium production, a figure which is expected to increase significantly by the end of the decade with the Cigar Lake Deposit (Cameco (50.025%); AREVA subsidiary, COGEMA Resources Inc. (37.1%); Idemitsu Uranium Exploration Canada Ltd. (7.875%); TEPCO Resources Inc. (5.0%)) scheduled for production in 2007. The Midwest project, managed by Cogema (69.16%) with Denison (25.17%) & OURD Canada (5.67%), will be milled at McClean Lake nearby, to produce 2600 t/yr uranium. The next largest producers are Australia, Kazakhstan, Russia and Niger.

The first major uranium discovery in the Athabasca Basin was at Rabbit Lake in 1968. The Rabbit Lake Mine operated for 25 years producing 120 million lbs U3O8 by open-pit mining of several ore lenses. In 1975, the richest open-pit deposit in the world was discovered at Key Lake. Over its 15-year life the Key Lake deposits produced more than 190 million lbs U3O8. Since 1968, 18 deposits totalling over 1.4 billion pounds of uranium have been discovered in the region.

Lookup for Companies Acitve in Athabasca Basin Region

Advertisement

Highlights of the Basin
  Saskatchewan produced approximately 30% of the world's total uranium production in 2004 having an estimated value of C$ 800 million (World Nuclear Association).

  Canada is the world's largest uranium producer. All of the country's production comes from Saskatchewan.

  At the current rate of extraction, Saskatchewan's known uranium deposits will last for more than 25 years. This figure only includes known deposits. New deposits are continually being discovered through exploration activities.

  After 2007 Canadian production is expected to increase further as more new mines come into production.

  Over 80% of the uranium shipped from Saskatchewan mines goes to non-Canadian markets.

  The energy potential of Saskatchewan's uranium reserves is approximately equivalent to 4 billion tonnes of coal or 19 billion barrels of oil.

  More energy is contained in Saskatchewan's uranium reserves than in all known Canadian conventional oil reserves (does not include the Athabasca tar sands).

Two of the global giants, Cameco Corp. (CCO-TSX) and COGEMA Resources Inc., a subsidiary of the AREVA Group, dominating mining in the Athabasca Basin; individually or with minority joint venture partners own and operate all the mines in the Basin.

The spot price for Uranium (U3O8) has steadily increased from its low of US$7.10 per pound at the end of 2000 to its November 28, 2005 price of US$34.50 per pound, an increase of approximately 386%. In addition, the rate of growth is accelerating with the annual price growth increasing as follows, for 2002, 2003 and 2004: US$0.60, US$4.30 and US$6.20 per pound respectively. The spot price of U3O8 historically lags the long term price by approximately US$1.00 to $2.00 per pound, reflecting the increased premium to secure a long-term supply in a tightening market.

A recent article (July 4, 2005) in the Globe & Mail relating to growing Chinese demand for uranium stated that according to a report by the Asia Pacific Foundation of Canada, industry experts are forecasting a global uranium shortage of 45,000 tonnes over the next decade. The demand for uranium is going to rise and will outpace existing stockpiles and sources of supply, any new discoveries will merit strong attention.

The strengthening of uranium prices since early 2004 has renewed interest in the Athabasca Basin and the surrounding region and significant staking activity has been underway. According to Saskatchewan Industry and Resources, there were 442 new claims staked and 38 new permits taken in 2004. There are now over 4.1 million hectares of ground in the Athabasca Basin under disposition for uranium exploration. This is an increase of approximately 2.9 million hectares (approximately 242%) compared to 2003. At present, there are more than 30 companies including many of them who are new to the basin, are actively exploring for uranium. Most of this activity is in the eastern part of the Athabasca Basin where the major deposits are located. The majority of these companies are publicly traded and are working in joint-venture with one or more other companies. The stocks of publicly-traded companies exploring for uranium in the Basin have seen dramatic price rises in the last year, particularly in the early part of 2005.

Saskatchewan Industry and Resources has projected total 2004 uranium exploration expenditures in the Basin to reach $26 million ($16 million spent by Cameco and AREVA), nearly double that spent in 2003.

Geology
The Athabasca Basin is filled by the Proterozoic Athabasca Group of relatively undeformed and flat-lying sedimentary rocks. These deposits are typically very high grade, with average grades exceeding 1% U3O8 in most of the deposits. In some notable cases such as at McArthur River and Cigar Lake the deposits may average up to 23% U3O8, with grades occasionally exceeding 50% U3O8.

These deposits occur at the unconformity between the Athabasca formation and basement rocks, primarily in the Wollaston and Mudjatic Domains but also in other lithostructural domains underlying the Athabasca basin. The high-grade unconformity-type uranium deposits within the Athabasca Basin are associated with the unconformity between the essentially flat-lying Proterozoic Athabasca Group sandstones and the underlying Archean-Paleoproterozoic metamorphic and igneous basement rocks of the Rae and Hearne Provinces. The deposits occupy a range of positions from wholly basement-hosted to wholly sediment-hosted, at structurally favorable sites in the interface between the deeply weathered basement and overlying sediments of the Athabasca Basin. The locations of these deposits are lithologically and structurally controlled by the sub-Athabasca unconformity and basement faults and fracture zones, which are localized in graphitic pelitic gneisses that may flank structurally competent Archean granitoid domes. In general, most of the known important deposits tend to occur within a few tens to a few hundred metres of the unconformity and within 500 metres of the current ground surface, thus making them accessible, attractive exploration targets. The initial discoveries were found through surficial indicators, such as radioactive boulders, strong geochemical anomalies in the surrounding lakes and swamps, and geophysical signatures. After these initial discoveries, an exploration model was developed that targeted electromagnetic conductors, based on the associated underlying graphitic schists with strong electro-magnetic signatures.

Major operations/projects in the Athabasca Basin
Source: Cameco Corporation and AREVA
  Cigar Lake
Ownership: Cameco Corporation (50.025%)
AREVA subsidiary, COGEMA Resources Inc. (37.1%)
Idemitsu Uranium Exploration Canada Limited (7.875%)
TEPCO Resources Inc. (5.0%)
Operator: Cameco Corporation (Cameco assumed operation in January 2002)
Capacity Planned annual production capacity of 18 million lbs. U3O8 (6,924 tonnes uranium)
Production: Anticipated in 2007, subject to regulatory approval
Reserves 231.5 million lbs. U3O8 (89,100 tonnes uranium) with an average grade of 21.0 % U3O8 primarily for Phase I. Resources, primarily for Phase II, are estimated to be 120 million lbs U3O8. Total reserves and resources are approximately 350 million pounds U3O8

  Key Lake
Ownership: Cameco Corporation (69.805%)
AREVA subsidiary, COGEMA Resources Inc. (30.195%)
Operator: Cameco Corporation
Capacity: Mill has a rated annual capacity of 18 million lbs. U3O8 (6,924 tonnes uranium), the largest capacity in the world
18.7 million lbs. U3O8 (7,193 tonnes uranium); this production is from ore transported from McArthur River. McArthur River ore will enable the Key Lake mill to continue operations for the next 25 years
Reserves: All Key Lake reserves are now depleted. The mill now processes ore from McArthur River

  McArthur River
Cameco Corporation (69.805%)
AREVA subsidiary, COGEMA Resources Inc. (30.195%)
Operator: Cameco Corporation
Capacity: Annual production capacity of 18 million lbs. U3O8 (6,924 tonnes uranium) milled at the Key Lake site.
Production: 18.7 million lbs. U3O8 (7,193 tonnes uranium); all ore is milled at Key Lake
Reserves: 436.8 million lbs. U3O8 (167,897 tonnes uranium) with an average grade of 25.0% U3O8

  McClean Lake
Ownership: AREVA subsidiary, COGEMA Resources Inc. (70.0%)
Denison Mines Inc. (22.5%)
OURD Canada Co. Limited (7.5%)
Operator: AREVA
Capacity: Initially 6.0 million lbs. U3O8; Annual licensed capacity increased to 8 million lbs. U3O8 (3,077 tonnes uranium) in 2001
Production: 6.0 million lbs. U3O8 (2,310 tonnes uranium)
Reserves: 32.9 million lbs. U3O8 (12,655 tonnes uranium) in situ and stockpiled with an average grade of 1.7% U3O8

  Midwest Project
Ownership: AREVA subsidiary, COGEMA Resources Inc. (69.16%)
Denison Mines Inc. (25.17%)
OURD Canada Co. Limited (5.67%)
Operator: AREVA
Production: Test mining completed
Reserves: 35 million lbs. U3O8 (13,460 tonnes uranium) with an average grade of 4.4% U3O8

  Rabbit Lake
Ownership: Cameco Corporation (100%)
Operator: Cameco Corporation
Capacity: Mill has a nominal capacity of 12 million lbs. U3O8 (4,615 tonnes uranium)
Production: 5.4 million lbs. U3O8 (2,077 tonnes uranium)
Reserves: 18.0 million lbs. U3O8 (6,924 tonnes uranium) with an average grade of 1.2% U3O8

Related Resources:
Uranium Production in Athabasca Basin
Uranium Reserves in Athabasca Basin

Lookup for Companies Acitve in Athabasca Basin Region

Reference:
All above mentioned companies web site and annual reports
Government of Saskatchewan
Uranium Information Centre Ltd.

Disclaimer:
The information herein may contains forward looking statements based on assumptions and judgments of the management of the above the mentioned companies regarding events or results that may prove to be inaccurate as a result of exploration or other risk factors beyond its control. Actual results may differ materially from the expected results. All statements herein, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the above mentioned companies expects are forward-looking statements. Such forward-looking statements are not guarantees of future performance, and are based on numerous assumptions about future conditions that could change. The material contained herein is for information purposes only and is not and is under no circumstances intended to constitute an offer to sell or a solicitation to buy any securities or a recommendation as to the purchase of any securities. The information contained herein has been obtained from the above featured company as well as the other publicly available sources and is believed to be accurate. Although reasonable efforts have been made to compile this data with care, neither Investcom, its employees, officers or directors guarantees the accuracy or completeness thereof, nor shall any of them be liable to the user or to any other person, firm or corporation whatsoever for any inaccuracies, errors or omissions contained herein nor for any damages arising therefrom or occasioned thereby. Investcom is not an investment advisor, readers are highly recommended to consult his Financial Advisors before making any investments related to any specific companies mentioned in Investcom's web site. The use of this presentation is limited to the recipient. Review of this profile by any other party is expressly not authorized. The user is expressly not authorized to duplicate this report or make all or a portion of this report available to third parties in any manner or form without the prior written consent of Investcom. Investcom may have been paid a fee by the above mentioned companies and the above mentioned companies may have contributed to printing and other related expenses. In addition, Investcom, its directors, officers or employees may have a long or short position in the securities of the above mentioned companies.


Red Dot

Toronto    |     Venture Exchange    |     NEX Board    |     Montreal Exchange    |     CSE    |     US Markets
Market Activity    |     Market Diaries    |     ETFs    |     Income Trusts    |     Forex    |     IPO    |     Brokerage
Market News    |     Feature Companies    |     Mining Sector    |     Economic Reports
Industry Links    |     What's New    |     Contact Us    |     Link to us    |     Home

Disclaimer | Privacy Policy Statement
Copyright © 1997 - 2014
All rights reserved. No part of this database may be reproduced, distributed, or utilized in any form or by any means, electronic or mechanical, without written permission from the owner.