Exhibit 1
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TSX: CCO NYSE:
CCJ |
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website: cameco.com
currency: Cdn (unless noted) |
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2121 11th Street West, Saskatoon, Saskatchewan, S7M
1J3 Canada
Tel: 306-956-6200 Fax: 306-956-6201
Cameco Provides Production and Market Update
Saskatoon, Saskatchewan, Canada, September 3,
2023 . . . . . . . . .
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Cameco (TSX: CCO; NYSE: CCJ) provided a
market update today regarding challenges at the Cigar Lake mine and Key Lake mill that are expected to impact our 2023 production forecast.
At the Cigar
Lake mine, we now expect to produce up to 16.3 million pounds of uranium concentrate (U3O8) (100% basis) this year, a reduction from
the previous forecast of 18 million pounds U3O8 (100% basis). Production from the McArthur River/Key Lake operations for 2023 is
anticipated to be 14 million pounds U3O8 (100% basis), down from the previous forecast of 15 million pounds U3O8 (100% basis).
As previously reported,
mining activities at the Cigar Lake operation were initiated from a new zone in the orebody (west pod) in the second quarter of this year, which impacted productivity. As mining activities continued in the west pod during the third quarter,
equipment reliability issues emerged which further affected performance. The mine is scheduled to enter its planned annual maintenance shutdown that will run through most of September.
At the Key Lake mill, ramp up activities remain ongoing. However, as noted in our second quarter MD&A, there is continued uncertainty regarding planned
production in 2023 at Key Lake due to the length of time the facility was in care and maintenance, the operational changes that were implemented, availability of personnel with the necessary skills and experience, and the impact of supply chain
challenges on the availability of materials and reagents. These factors have combined to impact production at Key Lake, leading to the reduced forecast. The McArthur River mine continues to operate well and is expected to achieve its planned
production for the year. Any ore from McArthur River that is not immediately processed at Key Lake will be stored in inventory for future milling.
Camecos strategy of full-cycle value capture positions us to effectively manage the expected production shortfall and meet our delivery commitments to
our customers. We maintain the flexibility to source material through various means beyond production if required, including increasing our market purchases, pulling forward long-term purchases, using inventory or borrowing product. Any pounds we do
not produce this year will remain available to us and, with increasing supply pressures, potentially become more valuable when delivered in the future. We have exposure to higher prices under the market-related contracts in our long-term portfolio
and a pipeline of contracting discussions underway, which we expect will also benefit from the increased focus on securing access to scarce supplies and generate long-term value for Cameco. And we have a strong balance sheet to help us self-manage
risk.
This expected production shortfall further highlights the growing security of supply risk at a time when we believe the demand outlook is stronger
and more durable than ever and where the risk has shifted from producers to utilities. Uncertainty about where nuclear fuel supplies will come from to satisfy growing demand continues to drive long-term contracting, with clear evidence that the
broader uranium market is moving toward replacement rate contracting for the first time in over a decade. This is the type of contracting necessary to promote the price discovery already seen in the enrichment and conversion markets and that is
expected to incentivize investments in the supply needed to satisfy the growing long-term requirements.