About 550 temporary pink slips are now permanent after Cameo Corp. announced plans to indefinitely suspend production at two of its temporarily shuttered uranium facilities in northern Saskatchewan.
Another 150 people working at the Saskatoon-based uranium miner’s head office are expected to lose their jobs in the coming days, Cameco announced late Wednesday afternoon.
The cuts, which leave Cameco with a single operating mine in Saskatchewan, are what Cameco CEO Tim Gitzel described as another “tough decision” in response to persistently weak uranium prices.
“We don’t know today, and we don’t want to speculate (on when the operations will restart), because we don’t want to put any false hope out. It could be a significant period of time,” Gitzel said.
Late last year, Postmedia News reported that the Saskatoon-based uranium miner planned to shut down its McArthur River mine and Key Lake mill for 10 months beginning in early 2018.
Those shutdowns are now “indeterminate” as the company takes what Gitzel described as “supply actions,” decisions meant to reduce the amount and boost the price of uranium on the market.
“Obviously, there’s excess uranium around the planet. We didn’t want to add to that, because that will just exacerbate the problem,” he said, adding that Cameco will also buy uranium to fill its contracts.
The layoffs are expected to cost Cameco up to $45 million in severance this year. Its flagship Cigar Lake mine in northern Saskatchewan is now the province’s sole operating uranium mine.
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Cameco is one of northern Saskatchewan’s most important businesses, particularly when it comes to employing Indigenous people, a point Energy and Resources Minister Bronwyn Eyre made in a statement issued Wednesday.
“Now more than ever, all levels of government need to be engaged on this important file to ensure market access for Saskatchewan’s natural resource industries, such as uranium,” Eyre said in the statement, hinting at the recent U.S. probe of uranium imports.
Cameco, which returned to the red this week by posting a $76-million loss on revenues totalling $333 million, has been cutting costs in the face of weak prices, sent plummeting by the 2011 Fukushima Daiichi nuclear disaster.
The company previously shut down its Rabbit Lake mine in northern Saskatchewan, at a cost of about 500 jobs, slashed about 120 jobs from its headquarters in Saskatoon and curtained its U.S. uranium production operations.
While the news release announcing the plans took a bleaker tone than previous statements, which have expressed confidence in its “lower-for-longer” strategy, Gitzel said Cameco is not exploring the possibility of a sale and remains confident in growing demand.
“We’re going to muscle our way through this. This is a tough day and some tough decisions but we think we’ve got some excellent assets. Right now, we’re better off leaving that Saskatchewan uranium in the ground and buying on the market to fill our contracts … It’s coming back, it’s just a question of when.”
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(Reuters) - California's power grid operator on Monday issued an alert to homes and businesses to conserve electricity on Tuesday and Wednesday when a heat wave is expected to blanket the state.
The California Independent System Operator (ISO), the grid operator, said it issued the so-called "Flex Alert" due to high temperatures across the western United States, reduced electricity imports into the state, tight natural gas supplies in Southern California and high wildfire risk.
The ISO's alert followed an earlier notice by Southern California Gas Co (SoCalGas), the gas utility for the southern part of the state.
SoCalGas issued a gas curtailment watch on Monday, notifying customers to be prepared to reduce gas use if needed, with power generators expected to burn more fuel this week than usual to keep air conditioners humming.
SoCalGas, a unit of California energy company Sempra Energy, said the watch would remain in effect until further notice.
High temperatures in Los Angeles were forecast to top 90 degrees Fahrenheit (32 Celsius) Monday-Friday with the mercury expected to reach 97 degrees on Wednesday, according to AccuWeather. The normal high in the city at this time of year is 84 degrees.
The ISO said consumers "can help avoid power interruptions" by turning off all unnecessary lights, using major appliances before 5 p.m. and after 9 p.m., and setting air conditioners to 78 degrees or higher.
Gas supplies are expected to remain tight in Southern California this summer and winter due to reduced availability from SoCalGas' Aliso Canyon storage facility in Los Angeles, following a massive leak between October 2015 and February 2016, and ongoing shutdowns of several pipelines.
SoCalGas projected gas demand would rise from 3.0 billion cubic feet per day (bcfd) on Monday to 3.1 bcfd on Tuesday and 3.2 bcfd on Wednesday and Thursday, while receipts of the fuel via pipelines into California would only total about 2.6 bcfd.
That means SoCalGas will have to tap storage fields to make up the difference, which could hurt the utility's ability to stockpile enough fuel to avoid curtailments for some power and industrial customers on the coldest days during the winter heating season.
State and federal agencies have projected SoCalGas will only be able to deliver about 3.6 bcfd from non-Aliso storage fields due to the Aliso limitations and pipeline outages, which has only occurred once in the summer in the past five years but is fairly common in the winter.
(Reporting by Scott DiSavino; editing by Jonathan Oatis and Susan Thomas)
