The chief executive of Saskatchewan-based Cameco Corp. wants to make clear that the U.S. government will not get involved in its core uranium mining business under a huge nuclear reactor deal announced last week.
The deal would allow the U.S. government to arrange financing and facilitate permitting and approvals for new nuclear reactors south of the border worth at least $80 billion.
The reactors would use technology from Westinghouse, jointly owned by Cameco and Brookfield Asset Management.
“We need to directly address some of the misinformation we have seen published in recent days. The partnership interest with the U.S. government does not extend to Cameco’s core business, although our uranium products and fuel services are certainly well positioned to support the long-term development and operation of the global fleet as it grows,” CEO Tim Gitzel told analysts on a conference call Wednesday to discuss third-quarter results.
“The partnership strengthens our footprint to create significant value for our shareholders, but the U.S. government’s participation interest is only focused on the Westinghouse business.”
3066:57Saskatoon’s Cameco in strategic partnership with U.S. to help build nuclear reactors
Joel Bruneau, associate professor in the economics department at the University of Saskatchewan, joins The 306 to talk about Saskatoon firm Cameco’s strategic partnership with the U.S. government to help build nuclear reactors.
Chief Operating Officer Grant Isaac said the US government is effectively acting as a “stimulant” to develop energy on the scale needed to achieve domestic energy security.
“The U.S. government is stepping in and saying, ‘It’s time. It’s time to get going,'” Isaac said.
There are several ways the United States’ role could change, he added.
The government could finance plants built, owned and operated by other entities, spearhead its own projects entirely, or get somewhere halfway by building a plant and transferring it to a utility to operate.
“All options are on the table because the goal here is to get 24-hour baseload carbon-free electrons to market as quickly as possible to meet onshore demand and meet the [artificial intelligence data centre] demand,” Isaac said.
Westinghouse considers its AP1000 pressurized water reactor to be the most advanced nuclear power plant commercially available today. The units are capable of supplying more than one gigawatt of electricity to centralized power grids, and it is that model that the companies consider will be built under the agreement.
Turning Westinghouse into an independent company with the United States as a major shareholder is an option that is on the table, Isaac said.
“There is definitely a unique interest in investing only in Westinghouse and Cameco is a fun substitute for that. Brookfield is probably an even more fun substitute for investing only in Westinghouse,” he said.
“So we’re always aware that the last thing we want to have is value trapped within this family of assets that we’ve put together.”
Earlier Wednesday, Cameco raised its annual dividend to 24 cents, up from 16 cents.
It also posted a net loss of $158,000, or zero cents per diluted share, for the quarter ended Sept. 30, compared with a profit of $7.4 million, or two cents per diluted share, a year earlier.
Revenue from products and services amounted to $614.6 million, up from $720.6 million in the same quarter last year.
On an adjusted basis, Cameco says it earned seven cents per diluted share in its latest quarter, down from an adjusted profit of six cents per diluted share a year earlier.
