{"id":730028,"date":"2023-02-09T06:43:01","date_gmt":"2023-02-09T11:43:01","guid":{"rendered":"https:\/\/www.marketnewsdesk.com\/index.php\/cameco-announces-2022-results-strong-market-fundamentals-captured-in-record-long-term-contracting-of-80-million-pounds-uranium-and-17-million-kgu-of-conversion-services-disciplined-return-to-tier-on\/"},"modified":"2023-02-09T06:43:01","modified_gmt":"2023-02-09T11:43:01","slug":"cameco-announces-2022-results-strong-market-fundamentals-captured-in-record-long-term-contracting-of-80-million-pounds-uranium-and-17-million-kgu-of-conversion-services-disciplined-return-to-tier-on","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/cameco-announces-2022-results-strong-market-fundamentals-captured-in-record-long-term-contracting-of-80-million-pounds-uranium-and-17-million-kgu-of-conversion-services-disciplined-return-to-tier-on\/","title":{"rendered":"Cameco announces 2022 results; strong market fundamentals captured in record long-term contracting of 80 million pounds uranium and 17 million kgU of conversion services; disciplined return to tier-one run rate with exposure to improving prices"},"content":{"rendered":"

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Cameco announces 2022 results; strong market fundamentals captured in record long-term contracting of 80 million pounds uranium and 17 million kgU of conversion services; disciplined return to tier-one run rate with exposure to improving prices<\/b><\/p>\n

SASKATOON, Saskatchewan–(BUSINESS WIRE<\/a>)–
\nCameco (TSX: CCO; NYSE: CCJ) today reported its consolidated financial and operating results for the fourth quarter and year ended December 31, 2022 in accordance with International Financial Reporting Standards (IFRS).\n<\/p>\n

\n\u201cDemand for nuclear power, supported by growth across the near, medium and long term, is driving the best fundamentals we have ever seen for the nuclear fuel market. The growing structural gap has led to supply uncertainty, which was amplified in 2022. As a proven, reliable, independent, commercial supplier of nuclear fuels, Cameco is positioned to benefit from these fundamentals. Our 2022 results, and our guidance for 2023, reflect the transformative year that we have had and the opportunity that remains ahead of us. In 2022, we were successful in contracting 80 million pounds of uranium and 17 million kgU of conversion services, with a record number of contracts signed in a market that has strengthened and is in durable growth mode. Our contracting also allows us to sustainably operate our assets, including tier-one assets that are expected to generate full-cycle value for Cameco. And, in 2022, with the resumption of production at McArthur River and Key Lake, we began the return to a tier-one run rate, which we expect will significantly improve our financial results,\u201d said Tim Gitzel, Cameco\u2019s president and CEO.\n<\/p>\n

\n\u201cThe geopolitical events that impacted 2022 accelerated security of supply concerns and coupled with the ongoing focus on the climate crisis, created what we believe are transformative tailwinds for the nuclear power industry from both a demand and supply perspective. In early-January, unrest in Kazakhstan raised concerns about the security of the more than 40% of global uranium supply that originates from Kazakhstan. However, it was the Russian invasion of Ukraine in late-February that was the most transformative event for our industry. We believe it has set in motion a geopolitical realignment in energy markets that is highlighting the crucial role for nuclear power not just in providing clean energy, but also in providing secure and affordable energy. And, with the global nuclear industry reliant on Russian supplies for approximately 14% of uranium concentrates, 27% of conversion and 39% of enrichment, it is highlighting the security of supply risk associated with the growing primary supply gap and shrinking secondary supplies, and increasing the focus on origin of supply.\n<\/p>\n

\n\u201cWe continue to believe that Cameco remains the best way to invest in the recovery of the uranium market. With nuclear energy clearly back in durable growth mode, Cameco is also back in durable growth mode. Growth that will be sought in the same manner as we approach all aspects of our business; strategic, deliberate, disciplined, and with a focus on generating full-cycle value.\n<\/p>\n

\n\u201cWe have had success capturing the improving market fundamentals with a record number of contracts signed. Our contracting focus has been on obtaining market-related pricing mechanisms, while also providing adequate downside protection. We continue to be strategically patient in our discussions to maximize value in our contract portfolio and to maintain exposure to higher prices with unencumbered future productive capacity.\n<\/p>\n

\n\u201cWith the improvements in the market, the new long-term contracts we have put in place and our pipeline of contracting discussions, we are moving to the next phase of our supply discipline. Our plan will now be for McArthur River\/Key Lake to produce 18 million pounds per year (100% basis) starting in 2024 and we will continue to operate Cigar Lake at its licensed capacity of 18 million pounds per year (100% basis) in 2024. At Inkai, production will continue to follow the 20% reduction planned by Kazatomprom (KAP) until the end of 2023. With annual licensed capacity of 25 million pounds at McArthur River\/Key Lake, we continue to have the ability to expand production from our existing assets. If we took advantage of all of the tier-one expansion opportunities available to us, our annual share of tier-one supply could be about 32 million pounds. However, any decision to expand production will be dependent on further improvements in the uranium market and our ability to secure the appropriate long-term contract homes for our unencumbered, in-ground inventory, demonstrating that we continue to responsibly manage our supply in accordance with our customers\u2019 needs.\n<\/p>\n

\n\u201cThanks to our deliberate actions and conservative financial management we have been and continue to be resilient. The strength of our balance sheet allowed us to take advantage of two opportunities in 2022 that we believe will add significant long-term value for Cameco. We acquired a greater share in the Cigar Lake mine, increasing our ownership to 54.5%. We are pleased to increase our share in the Cigar Lake operation, which is a proven, permitted and fully licensed tier-one mine in a safe and stable jurisdiction that we operate with the tremendous participation and support of our neighbouring Indigenous partner communities. And, we entered a strategic partnership with Brookfield Renewable Partners and its institutional partners (Brookfield Renewable) to jointly acquire 100% of Westinghouse Electric Company (Westinghouse), a global provider of mission-critical and specialized technologies, products and services across most phases of the nuclear power sector. The acquisition is expected to close in the second half of 2023 and is subject to customary closing conditions and certain regulatory approvals. Once the transaction closes, Brookfield Renewable, will beneficially own a 51% interest in Westinghouse and we will beneficially own 49%. We believe bringing together our expertise in the nuclear industry with Brookfield Renewable\u2019s expertise in clean energy positions nuclear power at the heart of the clean energy transition and creates a powerful platform for strategic growth across the nuclear sector.\n<\/p>\n

\n\u201cWith the renewed recognition of the role nuclear power must play, we are optimistic about Cameco\u2019s role in supporting the transition to a net-zero carbon economy. Through our innovative decarbonization actions across efficiency, electrification, waste to value, carbon economy, and fuel switching themes \u2013 we expect to achieve a 30% absolute reduction from our total Scope 1 and 2 emissions level by 2030 from our 2015 baseline as our first major milestone on the journey to achieve our ambition of being net zero. We believe our largest contribution to the transition to a net-zero carbon economy comes from the nuclear fuels that we supply to support the generation of nuclear power \u2013 100% carbon-free electricity.\n<\/p>\n

\n\u201cWe have tier-one assets that are licensed, permitted, long-lived, and proven reliable, and that have expansion capacity. These tier-one assets are backed up by idle tier-two assets and what we think is the best exploration portfolio that leverages existing infrastructure. We also provide our customers with access to conversion, as well as fuel fabrication and reactor components for heavy water CANDU reactors. With the pending joint acquisition of Westinghouse, we are excited about being able to extend the base of our reach in the nuclear fuel cycle with assets that, like ours, are strategic, proven, licensed, permitted, and located in geopolitically important jurisdictions. Assets that we expect will be able to participate in the growing demand profile for nuclear energy from their existing footprint. And, we are exploring opportunities in the nuclear fuel cycle and in innovative, non-traditional commercial uses of nuclear power in Canada and around the world.\n<\/p>\n

\n\u201cWe believe we have the right strategy to achieve our vision of \u2018energizing a clean-air world\u2019 and we will do so in a manner that reflects our values. Embedded in all our decisions is a commitment to addressing the environmental, social and governance risks and opportunities that we believe will make our business sustainable over the long term.\u201d\n<\/p>\n

Summary of Q4 and 2022 results and developments:<\/b><\/p>\n