By Allison Martell
Jan 31 Canadian uranium miner Cameco Corp
said on Friday it has agreed to sell its interest in
Bruce Power, a partnership that operates one of the world's
largest nuclear generating facilities in Ontario, for C$450
million ($403 million).
But with uranium prices languishing, Cameco Chief Executive
Tim Gitzel is in no rush to spend the proceeds of the deal.
He would rather set it aside to develop assets the company
has already acquired - the Millennium project in northern
Saskatchewan and the Yeelirrie project in Western Australia, for
example - but not until time is right.
"We've got significant uranium pounds under our control, and
we're just waiting for the market to improve," Gitzel told
Reuters. "As the uranium market improves, as we believe it will
over the next period of time - years, I would say - we want to
About the price Cameco would look for before developing
those projects, Gitzel said something north of $70 a pound
"would be a starting point."
In the third quarter, the Saskatoon, Saskatchewan-based
miner's average realized uranium price was $50.73 a pound, and
it has contracts with customers at prices above the spot market.
Prices have been weak since the earthquake and tsunami that
struck Japan in March 2011, badly damaging the Fukushima Daiichi
atomic power plant and leading Japan - then a heavy user of
nuclear power - to shut down nearly all of its reactors.
SALE NO SURPRISE
Under the deal announced on Friday, BPC Generation
Infrastructure Trust, already a partner in Bruce Power, would
buy Cameco's 31.6 percent limited partnership interest. BPC,
also known as Borealis, is a division of the Ontario Municipal
Employees Retirement System.
Bruce Power's facility on the shore of Lake Huron provides
nearly one third of Ontario's electricity. A pricey
refurbishment is in the works and Cameco's sale is not a
surprise, given the looming capital bill, said RBC Dominion
Securities analyst Fraser Phillips said in a note to clients.
The deal is subject to three other partners in Bruce Power -
TransCanada Corp, the Power Workers' Union and the
Society of Energy Professionals - exercising or waiving right of
first offer, and regulatory approvals.