The immediate future of a $12- billion uranium ore body in northern Saskatchewan has been put in doubt, after efforts to contain a fl ood at the Cigar Lake mine failed Monday morning.
Mine engineers from Cameco Corp. were unable to get one of the mine's huge bulkhead doors to seal properly and stem the fl ow of water that had been pouring in at a rate of 1,500 cubic metres an hour since Sunday afternoon. On Monday, the decision was made to do an orderly evacuation of the mine and let ll with water.
All of the workers were able to safely leave the mine, which is located more than 600 kilometres north of Saskatoon.
Early indications are that the company will continue to do some construction work at the surface on the assumption the mine can be remediated and put into operation. How employment will be affected has not been determined.
There were 26 people directly employed in the mine's underground works at the time of the fl ood, according to company offi - cials.
On Sunday, the water began entering the mine when a section of development tunnel gave way. The rock fall allowed water to pour in under pressure from an adjacent sandstone formation about 450 metres below surface.
The tunnel work at Cigar Lake, located below the uranium ore body, is built through generally stable "basement" granite. However, the development tunnels at Cigar Lake are usually only a short distance away from the water-logged sandstone that exerts water pressure as great as ocean water at the same depth. Cameco offi cials estimate the part of the tunnel that gave way was only 11 metres away from the highly porous sandstone.
Cameco gave the order to abandon the mine at 11:30 a.m. on Monday, less than 90 minutes after company executives talked with analysts about their hopes that the bulkhead doors would contain the water in the mine as they were designed to do.
Instead, the failure of the gasket within the giant doors, plus the lack of pumping capacity to keep up with the inflow, resulted in the decision to abandon the mine and let it fl ood.
In the past two years, Cameco and the mine's other three owners have spent more than a half billion dollars developing Cigar Lake, a high-grade deposit that was fi rst discovered in 1978.
Abandoning the mine for now means giving up any hope the mine will start producing high-grade uranium ore by the most recent projection of early 2008. The mine's operators had hoped to increase production steadily in the following years as the company learned to employ a method of production using high-pressure water jets to extract the ore and pump it to the surface in a slurry.
Pieces of expensive mining equipment that were to be used in the process are now either under water or soon will be.
At one point on Monday morning, Cameco offi cials were talking about only a year's delay when it appeared the fl ooding might be contained by the bulkhead doors to just a single section of the mine. Following the failure of the doors to seal, Cameco president and CEO Jerry Grandey told analysts and media that no timetable to repair the damage can be produced until the company comes up with a plan on how to pump out the mine from surface and get down to the area that failed and close up the leak.
SOOOOOOOOOO All good U stocks will go balistic
Line up Guys
Cheers
Xan
UXA Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
