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[cdn-nucl-l] Cameco Provides Update on its Investment in Bruce Power
Posted on the Cameco news service September 9, 2002 and at:
Nothing wrong at Bruce Power.
Cameco Provides Update on its Investment in Bruce Power
Saskatoon, Saskatchewan, Canada, September 9, 2002
Cameco Corporation today provides an update regarding Bruce Power
Limited Partnership (Bruce Power) and the impact on Cameco of the
financial difficulties announced by British Energy plc (BE), the
majority owner in Bruce Power with 82.4%. Cameco owns 15% of Bruce Power
and the two unions representing employees hold the remainder.
The government of the United Kingdom (UK) announced today that it will
provide 410 million pounds (almost $1 billion Cdn) in working capital to
cover BE's immediate cash requirements, if any, and to allow BE to
stabilize its trading position in the UK and North America, including
Bruce Power's trading position. This short-term agreement with the UK
government will expire September 27, 2002. Cameco understands that BE
has undertaken to resolve its longer-term financial situation.
As a condition of the agreement to provide financial assistance, the UK
government required guarantees from certain BE subsidiaries, including
Bruce Power. As part owner, Cameco has consented to Bruce Power
providing the necessary guarantees.
Although the risk profile of Bruce Power has been temporarily increased
by these recent events, Cameco's commitment to invest up to $100 million
in Bruce Power and to provide up to $102 million in financial assurances
remains unchanged. To date, Cameco has invested about $70 million
exclusive of the $42 million that it invested in the initial fuel
inventory purchase, which has been fully recovered from Bruce Power.
Bruce Power has responded to the recent inquiry by the Canadian Nuclear
Safety Commission (CNSC) regarding its required financial guarantee. It
is expected that the matter of Bruce Power's financial guarantee will be
addressed at an upcoming, already scheduled meeting with the CNSC on
September 12, 2002.
Cameco believes the Bruce reactors will continue to be safe and well-run
and that Bruce Power will remain an important supplier of electricity,
accounting for 15% of Ontario's requirements.
As additional information comes available, Cameco will provide further
Cameco, with its head office in Saskatoon, Saskatchewan, is the world's
largest uranium supplier. The company's uranium products are used to
generate electricity in nuclear energy plants around the world,
providing one of the cleanest sources of energy available today.
Cameco's shares trade on the Toronto and New York stock exchanges.
Statements contained in this news release which are not historical facts
are forward-looking statements that involve risks, uncertainties and
other factors that could cause actual results to differ materially from
those expressed or implied by such forward-looking statements. Factors
that could cause such differences, without limiting the generality of
the following, include: volatility and sensitivity to market prices for
uranium, electricity in Ontario and gold; the impact of the sales volume
of uranium, conversion services, electricity generated and gold;
competition; the impact of change in foreign currency exchange rates and
interest rates; imprecision in reserve estimates; environmental and
safety risks including increased regulatory burdens; unexpected
geological or hydrological conditions; political risks arising from
operating in certain developing countries; a possible deterioration in
political support for nuclear energy; changes in government regulations
and policies, including trade laws and policies; demand for nuclear
power; replacement of production and failure to obtain necessary permits
and approvals from government authorities; legislative and regulatory
initiatives regarding deregulation, regulation or restructuring of the
electric utility industry in Ontario; Ontario electricity rate
regulations; weather and other natural phenomena; ability to maintain
and further improve positive labour relations; operating performance of
the facilities; success of planned development projects; and other
development and operating risks.
For investor inquiries, please contact: For media inquiries, please
Manager, Investor Relations
Phone: (306) 956-6639
Fax: (306) 956-6318
Director, Investor & Corporate Relations
Phone: (306) 956-6337
Fax: (306) 956-6318