The northern Saskatchewan operation was put on care and maintenance again after six Cameco employees tested positive for COVID-19, three working at Cigar Lake. Cameco restarted the mine in September after a COVID-induced shutdown in March. At peak production this fall the operation employed about 300 people.
Saskatchewan is in the grips of a second wave of the pandemic, creating an uncertain operating environment with difficulty accessing qualified personnel to run the operation, according to the company.
French firm Orano said it was placing the associated McClean Lake mill on care and maintenance, but it did not expect the closure to affect its financial outlook.
Cameco said any decision on restarting production "will depend on how the COVID-19 pandemic is impacting the availability of the required workforce at Cigar Lake, how cases are trending in Saskatchewan, in particular in northern communities, and the views of public health authorities".
The company expects to incur care and maintenance costs of between C$8-10 million per month.
Cameco's announcement follows last week's news that the US government is getting serious about setting up a national strategic uranium reserve.
The closure of Cigar Lake means Cameco will have to buy more uranium on the open market to meet its supply contract obligations, which could improve prices for other producers.
Cameco shares (TSX:CCO) gained more than 8% in early trading but were in the red by midday in Toronto at C$16.97.
Shares in several junior producers and developers achieved 12-month highs, including Denison Mines (TSX:DML) at 80c, up nearly 12%, Energy Fuels (TSX:EFR) at $4.44, up 13.5%, and Uranium Energy Corp (NYSE American:UEC) at US$1.77, up 18%.
Cigar Lake is owned by Cameco (50.025%), Orano Canada (37.1%), Idemitsu Canada Resources (7.875%) and TEPCO Resources (5.0%).
The McClean Lake joint venture is owned by Orano Canada (77.5%), Denison Mines (22.5%) and is operated by Orano.