Cameco to Shut Down Top Uranium Mine After Talks With Union Fail

Aug 29, 2014 11:05 pm ET

Aug. 29 (Bloomberg) -- Cameco Corp. said it failed to reach an agreement with unionized workers to avoid the shutdown of its McArthur River uranium mine in western Canada, the world’s largest.

The Saskatoon, Saskatchewan-based uranium producer said in a statement it presented a final offer to the union bargaining committee yesterday and requested it be voted on. The committee rejected the request, Cameco said.

Cameco and the United Steelworkers union held talks this week after the union issued a notice to begin a strike at the mine tomorrow. The company responded with plans to lock out the workers and conduct a “safe and orderly” shutdown of the unit and the nearby Key Lake uranium mill in northern Saskatchewan.

McArthur River has the capacity to produce 18 million pounds of uranium a year, or about 10 percent of global demand, Edward Sterck, a London-based analyst at Bank of Montreal, said this week in a note to clients. The mine was the world’s largest by production last year, according to the World Nuclear Association.

Uranium is the raw material for nuclear reactor fuel.

The previous four-year labor contract at McArthur River expired Dec. 31, according to Cameco. Nine months of negotiations included more than 28 face-to-face meetings between the company and the union, Mike Pulak, a USW spokesman, said Aug. 27 in an e-mail.

Cameco is the largest uranium producer after Kazakhstan’s KazAtomProm, according to the World Nuclear Association.

--With assistance from Sylvia Wier in New York.