• Cameco and Kazatomprom’s Performance: Cameco’s uranium delivery forecast remains stable, with a 47% increase in Canadian production. Kazatomprom raises its 2024 production guidance due to a strong mid-year performance, with a 6% increase in 100% production and a 7% increase in attributable production compared to the previous year.
• Kazatomprom’s Production Guidance: Kazatomprom revises its 2024 production targets to 22,500-23,500 tU on a 100% basis and 11,600-12,600 tU attributable, emphasizing inventory replenishment despite potential sulphuric acid access and new deposit construction delays.
• Cameco’s Operational Challenges: Cameco faces challenges at Key Lake and Cigar Lake, impacting their 2023 targets. The Inkai joint venture with Kazatomprom also encounters sulphuric acid supply and procurement issues, with Cameco working to mitigate risks via the Trans-Caspian International Transport Route and other strategies.

At the halfway mark of the year, Canadian uranium producer Cameco stated that its forecast for uranium deliveries remains consistent, while Kazakh producer NAC Kazatomprom is raising its full-year production guidance for 2024 based on its mid-year performance.

Kazatomprom’s quarterly and half-year results reveal a production of 10,857 tU on a 100% basis (5,797 tU on an attributable basis) for the year so far, representing a 6% increase in 100% production and a 7% increase in attributable production compared to the previous year.

Cameco reported that its share of production from Canadian operations reached 12.9 million pounds of U3O8 (4,962 tU), marking a 47% increase from the previous year. However, the company noted that in 2023, the Key Lake mill had not yet reached its 18 million-pound annual target, and Cigar Lake’s productivity was affected by a transition to a new mining area.

Both companies highlighted in their announcements that year-on-year comparisons of sales and delivery volumes can be influenced by the timing of contractual deliveries.

Kazatomprom targets a boost in production

Kazatomprom announced it is raising its full-year 2024 production guidance for both 100% and attributable bases, as the half-year results indicate that the current production rates of its mining entities are likely to exceed initial expectations. Previously, the guidance was set at 21,000-22,500 tU on a 100% basis (10,900-11,900 tU attributable); it has now been revised to 22,500-23,500 tU on a 100% basis (11,600-12,600 tU attributable).

Sales guidance remains the same, and the company stated that the additional uranium production will be allocated to replenishing its inventories. It emphasized that restricted access to sulphuric acid and delays in construction at newly developed deposits could negatively impact its production plans for 2025. The company indicated that any updates to the 2025 production plans will be provided in its financial results announcement later this month.

Cameco stays on track

Cameco CEO Tim Gitzel stated that the company’s operational performance in the second quarter was robust, contributing to financial results that align with the company’s full-year expectations. He noted that the overall results are still affected by purchase accounting and other non-operational expenses associated with the 2023 acquisition of Westinghouse.

Cameco also holds interests in Kazakhstan through its Inkai joint venture with Kazatomprom. Gitzel noted that production at this joint venture was lower in the first half of 2024 due to early-year challenges with sulphuric acid supply. He added that the joint venture continues to face procurement and supply chain issues. The 2024 production forecast of 8.3 million pounds U3O8 (on a 100% basis) for Inkai is tentative and depends on securing adequate volumes of sulphuric acid.

Ongoing risks for JV Inkai include procurement and supply chain problems, transportation issues, construction delays, and inflationary pressures on production costs. Geopolitical factors also pose transportation risks in the region. Cameco is working closely with Kazatomprom to transport its share of production via the Trans-Caspian International Transport Route, which avoids Russian rail lines and ports. However, the company cautions that further delays in Inkai deliveries could arise if this route experiences unforeseen delays. To mitigate risks of production shortfalls or transport delays, Cameco has inventory, long-term purchase agreements, and loan arrangements in place.