October 6, 2011 / 2:17 AM / 7 years ago

UPDATE 1-Cameco signs MoU to cut operating costs at Cigar Lake project

* Signs deal to mill all Cigar Lake ore at the McClean Lake mill

* Says project’s production startup date remains mid-2013 (Follows alerts)

Oct 5 (Reuters) - Cameco Corp said it signed a new milling arrangement with its joint venture partners which will help it cut operating cost at its Cigar Lake project.

Canada’s top uranium producer said it signed a non-binding memorandum of understanding with its joint venture partners — AREVA Resources Canada Inc, Idemitsu Resources Canada Inc and Tepco Resources Inc— to mill all Cigar Lake ore at the McClean Lake mill.

Cigar Lake, located about 660 kilometres north of Saskatoon, is the world’s largest undeveloped high-grade uranium deposit, according to Cameco’s website.

The company said estimated average cash operating cost would drop to about $18.60 per pound from $23.14 per pound due to the new milling arrangement.

Cameco, which owns a 50 percent stake in the Cigar Lake project, said it continues to expect production to start in mid-2013. (Reporting by Swetha Gopinath in Bangalore; Editing by Muralikumar Anantharaman)

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