THE RIGHT STRATEGY
Cameco's strategy is focused on taking advantage of the long-term growth we see coming in our industry, while maintaining the ability to respond to market conditions as they evolve. Our strategy is to focus on our tier-one assets and profitably produce at a pace aligned with market signals in order to preserve the value of those assets and increase long-term shareholder value, and to do that with an emphasis on safety, people and the environment.
We have world class assets that are the foundation of our strategy, providing an extensive base of mineral reserves and resources and diversified sources of supply. These include our tier-one operations at McArthur River/Key Lake, the largest uranium operation in the world, and Cigar Lake, the highest grade uranium deposit in the world, as well as Inkai in Kazakhstan. These assets are complemented by participation in other parts of the nuclear fuel cycle, producing fuel and components for reactors around the world.
OPERATING REACTOR GROWTH
There is a growing acknowledgement that achieving clean air and global climate change goals requires a material dedication to all non-emitting energy sources, including nuclear. 53 new reactors are under construction around the world and nine began commercial operation in 2018 and early 2019.
While some areas have experienced reactor retirements, reduced reliance, or nuclear phase-out policies, growth and resurgence is occurring in other regions. In China, seven new reactors began commercial operation. In Japan, nine reactors are now operating and 18 more are at various stages in the restart approval process. Japan also confirmed that nuclear power will continue to play a significant role in its energy strategy with the approval of a new basic energy plan.
LONG-TERM MARKET GROWTH
We believe the current backlog of long-term contracting presents a substantial opportunity for commercially motivated suppliers like us that can weather the low-price part of the cycle. UxC estimates that cumulative uncovered requirements are about 1.9 billion pounds to the end of 2035. We do not believe the pounds available in the spot market will be enough to satisfy the growing backlog of long-term demand.
There is opportunity, in the long term, for strong producers that have the right mix of low-cost assets and flexibility to fulfill utilities' uncovered requirements.
Caution about Forward-Looking Information
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