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SaskPower, Westinghouse and Cameco Sign MOU to Explore Reactor and Fuel Supply Potential

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SaskPower, Westinghouse, and Cameco have signed an MOU to explore Westinghouse's nuclear reactor technology and the required nuclear fuel supply chain for Saskatchewan's clean power needs.

The MOU will evaluate technical and commercial pathways for deploying Westinghouse’s AP1000® reactor and AP300™ small modular reactor (SMR) for Saskatchewan's long-term electricity supply planning.

This includes a Saskatchewan-based nuclear supply chain, collaboration on nuclear research, workforce training, and a potential final investment decision by 2029 for building Saskatchewan’s first SMR facility.

Westinghouse’s reactors are operational and setting performance records globally, with the AP300 SMR targeted for design certification by 2027 and construction starting in 2030. Cameco and Westinghouse aim to help Saskatchewan achieve carbon-free electricity for the future.

Positive
  • MOU signed between SaskPower, Westinghouse, and Cameco to explore nuclear technology and fuel supply chain.
  • Evaluation of Westinghouse’s AP1000 reactor and AP300 SMR for long-term electricity needs.
  • Development of a Saskatchewan-based nuclear supply chain.
  • Collaboration on nuclear research, development, and workforce training with Saskatchewan post-secondary institutions.
  • SaskPower's potential final investment decision by 2029 for constructing the first SMR facility.
  • Westinghouse’s AP1000 reactor setting operational performance records in the U.S. and China.
  • AP300 SMR selected by the UK’s Great British Nuclear program.
  • AP300 SMR design certification targeted by 2027 and first construction to start by 2030.
Negative
  • Final investment decision on SMR facility construction delayed until 2029.
  • Potential risks associated with the deployment and performance of new reactor technology.
  • Uncertain timelines for the nuclear supply chain development and workforce training.

Insights

The memorandum of understanding (MOU) between SaskPower, Westinghouse Electric Company and Cameco Corporation signals a significant development in the energy sector, particularly in nuclear energy. This collaborative effort aims to evaluate the deployment of Westinghouse’s advanced nuclear reactor technology, namely the AP1000® and AP300™ SMR, for Saskatchewan's future electricity needs.

Short-term implications: In the short term, the MOU will likely foster substantial research, development and feasibility studies. These initiatives would not only assess the technical and commercial viability of the reactors but also the establishment of a local nuclear supply chain. The planned collaboration with Saskatchewan’s post-secondary institutions on research and workforce training is a proactive step in addressing potential workforce shortages, which is important for long-term sustainability.

Long-term outlook: Over the long haul, if SaskPower's evaluation favors the deployment, the construction of the province's first SMR facility could commence. This could potentially revolutionize Saskatchewan's energy landscape by providing a steady, carbon-free electricity supply, positioning the province as a leader in clean energy. However, the final investment decision in 2029 and the subsequent construction imply a long gestation period before tangible results are realized. Moreover, the reliance on proven technologies like the AP1000® and the prospective AP300™ SMR reduces the technological risk but underscores the need for rigorous economic analysis considering high initial capital investment and long payback periods typical of nuclear projects.

Supply Chain Synergies: By leveraging Saskatchewan's rich uranium resources and Cameco's extensive experience, the partnership aims to create a robust, local nuclear fuel supply chain. This could enhance energy security and economic benefits within the province, stimulating local industries and creating jobs.

Industry context: The global push towards decarbonization makes nuclear energy an increasingly attractive option due to its low carbon footprint and reliability compared to intermittent renewable sources like wind and solar. Therefore, this MOU aligns well with broader energy transition goals, although it also brings the usual challenges associated with nuclear energy, such as waste disposal, high costs and stringent regulatory requirements.

The collaboration between SaskPower, Westinghouse and Cameco holds potential financial implications. Here's an analysis from a financial standpoint, considering both immediate and long-term impacts.

Short-term financial implications: Initially, engagement in advanced research and feasibility studies will incur costs without immediate financial returns. However, these activities are essential groundwork for informed decision-making and risk mitigation in future investments. The involvement of recognized entities like Westinghouse and Cameco signals confidence in the project's potential, which could positively influence investor sentiment towards these companies.

Long-term financial outlook: If the project progresses to construction post-2029, significant capital investments will be required. Nuclear projects typically involve high upfront costs but can offer substantial long-term returns due to their long operational life and stable electricity generation. The anticipated deployment of the AP1000® and AP300™ reactors, known for their operational efficiency, could provide a reliable revenue stream once operational. However, investors should remain cautious of the long payback periods and potential cost overruns, common in large-scale nuclear projects.

Market dynamics: Successful deployment of these reactors could enhance SaskPower's portfolio, potentially reducing power generation costs and stabilizing electricity prices in the region. For Cameco, a steady demand for uranium within Saskatchewan could bolster its revenue streams and market position. Similarly, Westinghouse's involvement could enhance its reputation and market value, showcasing the global applicability and reliability of its reactor technologies.

Investor considerations: Investors should weigh the benefits of potential long-term returns against the inherent risks of nuclear projects, such as regulatory hurdles, construction delays and public acceptance issues. Diversification strategies and a risk-adjusted approach could be prudent in this context.

SASKATOON, Saskatchewan--(BUSINESS WIRE)-- Saskatchewan Power Corporation (SaskPower), Westinghouse Electric Company (Westinghouse) and Cameco Corporation (Cameco) (TSX: CCO; NYSE: CCJ) have signed a memorandum of understanding (MOU) to evaluate the potential of Westinghouse’s nuclear reactor technology and the associated nuclear fuel supply chain required for Saskatchewan’s future clean power needs.

The MOU will explore technical and commercial pathways to deploy Westinghouse’s reactor technology, including the advanced AP1000® reactor and AP300™ small modular reactor (SMR), for long-term electricity supply planning. The framework includes evaluation of a Saskatchewan-based nuclear supply chain to support nuclear energy projects, including fuel. It also identifies opportunities to collaborate on nuclear research, development and workforce training in partnership with Saskatchewan’s post-secondary institutions.

SaskPower is expected to make its final investment decision in 2029 whether to proceed with constructing Saskatchewan’s first SMR facility. The utility intends to use Saskatchewan uranium in any reactor constructed in the province.

“Leveraging knowledge from organizations that have significant expertise in the nuclear industry is critical to ensure we make responsible, informed decisions around our power future,” said Rupen Pandya, President and CEO of SaskPower. “Collaborating on nuclear fuel supply and evaluating various technologies will only serve to enhance our current small modular reactor development work and planning around workforce and the future of Saskatchewan’s power system.”

The AP1000 reactor is in operation in the U.S. and China, where it is setting operational performance and availability records. It has been selected for the nuclear energy programs in Poland, Ukraine and Bulgaria, and is also under consideration at multiple other sites in Central and Eastern Europe, the United Kingdom (UK), India and North America.

The AP300 modular reactor is the only SMR based on an advanced, large Generation III+ reactor already in operation globally. Westinghouse is targeting design certification by 2027 and for first construction to begin by 2030, with the operating unit planned to be available in the early 2030s. The AP300 SMR has been selected by the UK’s Great British Nuclear program and is under further customer consideration in Europe and North America.

“Westinghouse is proud to work with SaskPower to share our industry-leading nuclear technology expertise in support of the province’s clean energy needs,” said Patrick Fragman, Westinghouse President and CEO. “Our globally deployed advanced AP1000 reactor provides demonstrated superior economic performance and availability, and our AP300 small modular reactor is based on this proven and licensed technology. We look forward to helping SaskPower bring carbon-free electricity to Saskatchewan for generations to come.”

“Cameco has a proud history and a significant presence in Saskatchewan, from our world-class uranium operations to our large and growing provincial workforce to our long-standing partnerships with northern Indigenous communities,” said Tim Gitzel, President and CEO of Cameco. “We look forward to assessing the potential role Cameco and Westinghouse could play in decarbonizing Saskatchewan’s power grid, an ambitious and important goal for the province’s future.”

About SaskPower

Recognized as one of Saskatchewan’s Top Employers and one of Canada’s Best Diversity Employers, SaskPower is the principal electrical utility for Saskatchewan, serving over a half million customers across an extensive geographic area. Founded in 1929, SaskPower is headquartered in Regina and employs over 3,000 employees across Saskatchewan. SaskPower is committed to enabling growth in the province and continuing economic reconciliation with Indigenous Peoples – winning several awards and achieving the Canadian Council for Aboriginal Business Progressive Aboriginal Relations (PAR) Gold Status multiple times.

About Westinghouse

Westinghouse Electric Company is shaping the future of carbon-free energy by providing safe, innovative nuclear technologies to utilities globally. Westinghouse supplied the world’s first commercial pressurized water reactor in 1957 and the company’s technology is the basis for nearly one-half of the world’s operating nuclear plants. Over 135 years of innovation makes Westinghouse the preferred partner for advanced technologies covering the complete nuclear energy life cycle. For more information, visit www.westinghousenuclear.com and follow us on Facebook, LinkedIn and Twitter.

About Cameco

Cameco is one of the largest global providers of the uranium fuel needed to energize a clean-air world. Our competitive position is based on our controlling ownership of the world’s largest high-grade reserves and low-cost operations, as well as significant investments across the nuclear fuel cycle, including ownership interests in Westinghouse Electric Company and Global Laser Enrichment. Utilities around the world rely on Cameco to provide global nuclear fuel solutions for the generation of safe, reliable, carbon-free nuclear power. Our shares trade on the Toronto and New York stock exchanges. Our head office is in Saskatoon, Saskatchewan, Canada.

Caution Regarding Forward-Looking Information and Statements

This news release includes statements and information about the expectations of SaskPower, Cameco and Westinghouse for the future, which we refer to as forward-looking information. Forward-looking information is based on our current views, which can change significantly, and actual results and events may be significantly different from what we currently expect. Examples of forward-looking information in this news release include: the expectation that under the MOU the parties will explore pathways to deploy Westinghouse’s reactor technology, including evaluation of a Saskatchewan-based nuclear supply chain; expected opportunities to collaborate on nuclear research, development and workforce training with Saskatchewan’s post-secondary institutions; the expected timing of SaskPower’s final investment decision whether to proceed with constructing the SMR facility, and its intention to use Saskatchewan uranium in any reactor constructed in the province; SaskPower’s expectation that collaboration will enhance its small modular reactor development work, and planning around workforce and the future of Saskatchewan’s power system; the expected dates for design certification, commencement of construction and operating unit availability for the AP300 modular reactor; the anticipated ability of SaskPower to bring carbon-free electricity to Saskatchewan for generations to come; and the assessment of the role that Cameco and Westinghouse could play in decarbonizing Saskatchewan’s power grid. Material risks that could lead to different results include: the risk that the MOU will not result in a successful exploration of pathways to deploy Westinghouse’s reactor technology; the risk that expected opportunities to collaborate on nuclear research, development and workforce training with Saskatchewan’s post-secondary institutions may not be realized; the risk that SaskPower’s final investment decision regarding the SMR facility may not be made when expected; the possibility that SaskPower may not be able to use Saskatchewan uranium to the extent expected; the possibility that collaboration may not enhance SaskPower’s small modular reactor development work and planning to the extent expected; the risk that expected dates for design certification, commencement of construction and operating unit availability for the AP300 modular reactor may not be achieved; the risk that SaskPower may not be able to provide carbon-free electricity to the extent expected; and the risk that Cameco or Westinghouse may not be able to play their expected roles in decarbonizing Saskatchewan’s power grid. In presenting the forward-looking information, we have made material assumptions which may prove incorrect about: our ability to work collaboratively to complete the evaluations and other goals of the MOU; SaskPower’s ability to achieve its various expected target dates and utilize Saskatchewan uranium; and the ability of SaskPower to provide carbon free electricity to the extent expected, and of Cameco and Westinghouse to play their expected roles in decarbonizing Saskatchewan’s power grid. Forward-looking information is designed to help you understand our current views, and it may not be appropriate for other purposes. We will not update this information unless we are required to by securities laws.

Inquiries

SaskPower:

Scott McGregor

media line: 306-536-2886

mediarelations@saskpower.com

Westinghouse:

Brian McCrone

445-289-0409

Brian.McCrone@westinghouse.com

Cameco (investor inquiries):

Rachelle Girard

306-956-6403

rachelle_girard@cameco.com

Cameco (media inquiries):

Veronica Baker

306-385-5541

veronica_baker@cameco.com

Source: Cameco

FAQ

What companies have signed an MOU to explore nuclear reactor technology for Saskatchewan’s clean power needs?

SaskPower, Westinghouse, and Cameco have signed an MOU to explore Westinghouse’s nuclear reactor technology for Saskatchewan’s clean power needs.

What nuclear reactor technologies are being evaluated under the new MOU signed by SaskPower?

The MOU evaluates Westinghouse’s AP1000® reactor and AP300™ small modular reactor (SMR) technologies.

When is SaskPower expected to make a final investment decision on constructing Saskatchewan’s first SMR facility?

SaskPower is expected to make its final investment decision by 2029.

What is the target year for the AP300 SMR design certification and first construction?

Westinghouse is targeting design certification for the AP300 SMR by 2027 and first construction to begin by 2030.

What are the global deployments or selections for Westinghouse’s AP1000 reactor?

The AP1000 reactor is operational in the U.S. and China, selected for nuclear programs in Poland, Ukraine, Bulgaria, and under consideration at multiple sites in Central and Eastern Europe, the UK, India, and North America.

What role does Cameco play in the new MOU related to Saskatchewan’s clean power needs?

Cameco will assess the potential role it and Westinghouse could play in decarbonizing Saskatchewan’s power grid.

Cameco Corporation

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