Saskatoon-based Cameco will restart its McArthur River uranium mine in northern Saskatchewan.
The mine was placed on care and maintenance in January 2018 due to unfavourable market conditions.
The ramp-up back to production will take some time, Cameco chief executive Tim Gitzel said.
Transitioning from care and maintenance to planned production capacity will require critical automation and digitization as well as carrying out maintenance readiness checks, he said.
The McArthur River mine and its Key Lake mill could produce up to 5 million pounds of uranium in 2022 depending on how quickly the mine comes online, and how the mine is affected by the COVID-19 pandemic and related supply chain issues, Gitzel said.
Cameco expects to produce 15 million pounds at its Cigar Lake uranium mine in 2022, at 20% below licensed capacity, and at the Inkai processing plant in Kazakhstan.
Inkai production will continue to operate at a 20% reduction until the end of 2023, as announced by Kazakh uranium importer-exporter Kazatomprom, Cameco said.
McArthur is expected to produce 15 million pounds annually beginning in 2024, which is 40% below the annual licensed capacity.
Cameco will reduce production at Cigar Lake to 13.5 million pounds per year in 2024, which is 25% below its licensed capacity. This measure will extend the life of the mine.
Together, this means Cameco will be operating at 33% below capacity.
"We plan to keep our tier-two assets on care and maintenance," Gitzel said.
Cameco expects to incur between C$50 million and C$60 million in care of maintenance costs for its two-tier assets.
Orano, which owns 30.2% of the McArthur River mine and 16.7% of the Key Lake mill, supports Cameco's production decisions.
"Given the continued unbalanced uranium market conditions, the restart of McArthur gives us the opportunity to reduce production at Cigar Lake, extending the life of this asset and postponing the need for new projects in northern Saskatchewan," Orano chief executive Nicolas Maes said.
Uranium prices have been at frustratingly low levels for uranium producers in the decade since the Fukushima disaster in 2011. Since 2012, uranium prices have remained under US$50.80 per pound, which has compelled producers to limit supply and scale back on production.
