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Year in Review: Uranium in doldrums but some sparkle returns to project near P.A.

Dec 26, 2018 | 7:00 AM

As 2018 draws to a close, paNOW is taking a look back on the most important and impactful stories of the year, as selected by our reporters and editorial staff.

As one key Saskatchewan mining operation was forced to shut down this year, another long-awaited project showed glimpses of coming to life.

The year did not start well. At the end of January the final shift at Cameco’s Key Lake and McArthur River uranium operations was wrapping up, leaving a total of 845 people out of work for what was initially expected to be a 10-month lay-off. While a special benefit package was negotiated with much of the workforce, that came as little consolation.

“The morale is low; people feel very uncertain of their future,” acting president for United Steelworkers Local 8914 Denis O’Hara told paNOW at the time. “Many have expressed they’re going to be looking for other permanent employment because their trust in Cameco is broken, and that’s disheartening.”

By the summer the outlook became more bleak with Cameco announcing those temporary layoffs had become permanent as the world uranium price continued to languish. About 700 people were laid off. Some jobs remained at the administration level or as care and maintenance crew on the sites.

“We said at the time we’d be watching the market closely, hoping for some improvement that would encourage us to bring these assets back into production; in fact we saw none,” CEO Tim Gitzel told paNOW. “The price dropped in the period we were down. There’s just too much supply out there right now.”

The fallout for Saskatchewan was expected to total tens of millions of dollars in lost salaries each year.

In September Gitzel did have some encouraging news but it was about the longer term future of the sector.

He was part of Premier Scott Moe’s first trade mission to China.

“Without China as a good customer it would make [the current situation] even more difficult,” Gitzel told paNOW. “Today, China has 57 reactors either in operation or under construction, and they told the premier and us that they plan to have 30 more under construction by 2020; that’s phenomenal growth.”

However there was no immediate news on when the two dormant mines in the North would re-open. 

Their short-term plight also highlighted the call for diversification of Saskatchewan’s underground resources.

“We need to start looking at other mineral potential that Saskatchewan has, including in diamonds, in gold (and) base rare earth minerals,” Pam Schwann the president of the Saskatchewan Mining Association said after the job losses.

Is there a sparkle of light on the horizon?

As Cameco pondered its woes, there was some key movement towards that potential for mining diversification as the long-awaited diamond operation east of Prince Albert showed modest signs of coming to life.

The company which owns the rights for the Star-Orion South Diamond Project in the Fort à la Corne forest said in September it was encouraged by the level and rate of activity ahead of planned bulk sampling by mining giant Rio Tinto. However, there was no indication as to when full mining operations might begin.

 “The on-site camp has recently been completely commissioned and is already full of people,” Senior Vice President Exploration and Development for Star Diamond Corporation George Read told paNOW. “The roads have been substantially rehabilitated, a bridge has been put in on the Shipman Trail, and there are vast improvements across the site.”

In October there was also an important breakthrough from Regina. After eight years of process the environmental assessment approval for the proposed diamond mine was granted.

The Ministry of Environment announced things could proceed to next steps.

 “We’re able to sign off to say that this is what the company is going to abide by in terms of trying to mitigate as much impact on the environment as possible,” Minister Dustin Duncan told paNOW. “If the project moves forward there are still a series of approvals and permits and leases the company still has to attain.”

But it wasn’t all rosy. James Smith Cree Nation (JSCN) said there would be no diamond mine in the Fort à la Corne Forest “until our people’s interests are satisfied.” In a statement, band members said the proposed venture would adversely affect their Treaty rights and culture.

 “Ultimately our way of life in that forest is going to be destroyed; we’re getting nothing from it,” adviser to the Chief and band member Winston McLean told paNOW. “For the last six years we’ve been trying to convince the government that the estimate of the project footprint is much larger than what the company claims; so basically it’s a lie.”

The JSCN, whose land runs adjacent to the site, called for real benefits for its people such as revenue-sharing, given the potential damage to the land. In response the government said it did not offer such benefits regarding these sorts of proposals.

As the year came to a close and with Rio Tinto planning its extensive exploratory work in the spring of 2019 the Métis Nation sounded buoyant about the project.

“Any time we can get our Métis people employed and especially with the jobs of this essence … it’s an awesome opportunity I think, and hopefully we can all benefit from it,” Sherry McLennan, the regional director for the Métis Nation Western Region 2 told paNOW.

Rio Tinto spoke to paNOW this month and said it was too early to speculate on the long term viability of Project Falcon and added it was also too early to say what benefit or revenue-sharing arrangements may be possible with local Indigenous groups.

General Manager of Exploration in North America Mark Tait said they were preparing to proceed with a series of 10 huge sample holes at the Star-Orion South site once the winter ended.

While stressing it was still early days, Tait said the company sees an opportunity.

“What I can point to is that we are certainly committed to the first phase of work, which is a significant investment, and we wouldn’t be doing that if we didn’t see potential in the project,” he said.

Those running Saskatchewan’s mining sector and the many jobs associated with it – whether they be jobs lost, or jobs yet to come – will be looking for some better news in 2019.

 

glenn.hicks@jpbg.ca

On Twitter:@princealbertnow