Q1 2022 Cameco Corp Earnings Call

May 5, 2022

Speaker 2: I.

Speaker 1: The.

Operator: Thank you for standing by. This is the conference operator. Welcome to the Cameco Corporation first quarter 2022 conference call. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation there will be an opportunity to ask questions. Join the question queue. you may press star than one on your telephone key pad should you need assistance during the conference call. May signal an operator by pressing star and zero.

Operator: Thank you for standing by. This is the conference operator. Welcome to the Cameco Corporation Q1 2022 conference call. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to Rachelle Girard, VP, Investor Relations, Treasury, and Tax. Please go ahead.

Operator: I would now like to turn the conference over to Rochelle Gerard VP, Investor Relations, treasury and tax. Please go ahead.

Rachelle Girard: Thank you operator, and good morning everyone. Welcome to Cameco's first quarter conference call. I would like to acknowledge that we are on Treaty Six territory and the homeland of the Metis.

Rachelle Girard: Thank you, operator, and good morning, everyone. Welcome to Cameco's Q1 Conference Call. I would like to acknowledge that we are on Treaty 6 territory and the homeland of the Métis. Today's call will focus on the trends we are seeing in the market and on our strategy. As always, our goal is to be open and transparent with our communications. Therefore, if you have detailed questions about our quarterly financial results or should your questions not be addressed on this call, we will be happy to follow up with you after the call. There are a few ways to contact us.

Rachelle Girard: Today's call will focus on the trends we are seeing in the market and on our strategy.

Rachelle Girard: As always, our goal is to be open and transparent with our communications. Therefore, if you have detailed questions about our quarterly financial results, or should your questions not be addressed on this call, we will be happy to follow up with you after the call. There are a few ways to contact us. You can reach out to contact provided in our news release. You can submit a questions through the contact tab on our website, or you can use the ask a question form at the bottom of the webcast screen and we will be happy to follow up after this call.

Rachelle Girard: You can reach out to the contacts provided in our news release. You can submit a question through the Contact tab on our website, or you can use the Ask a Question form at the bottom of the webcast screen, and we will be happy to follow up after this call. With us today on the call are Tim Gitzel, President and CEO; Grant Isaac, Senior Vice President and CFO; Brian Reilly, Senior Vice President and Chief Operating Officer; Alice Wong, Senior Vice President and Chief Corporate Officer; and Sean Quinn, Senior Vice President, Chief Legal Officer, and Corporate Secretary. I'm going to hand it over to Tim to talk about the long-term fundamentals for our industry, the current market dynamics, and about Cameco's strategy to add long-term value. After, we will open it up for your questions.

Rachelle Girard: With us today. On the call are Tim Gitzel, President and CEO, Grant Isaac, Senior Vice President and CFO, Brian Riley, Senior Vice President and Chief Operating Officer, Alice Wang, Senior Vice President and Chief Corporate Officer. And Sean Quinn, Senior Vice President, Chief Legal Officer and Corporate Secretary.

Rachelle Girard: I'm going to hand it over to Tim to talk about the long-term fundamentals for our industry, the current market dynamics and about chemical strategy to add long-term value. After we will open it up for your questions.

Rachelle Girard: If you joined the conference call through our website event page, there are slides available which will be displayed during the call. In addition, for your reference, our quarterly investor handout is available for download in a PDF file on our website at cameco.com. Today's conference call is open to all members of the investment community, including the media. During the QA session, please limit yourself to two questions and then return to the queue. Please note that this conference call will include forward-looking information which is based on a number of assumptions, and actual results could differ materially. Please refer to our annual information form and MD&A for more information about the factors that could cause these different results and the assumptions we have made. With that, I will turn it over to Tim Gitzel.

Rachelle Girard: If you joined the conference call through our website event page, there are slides available which will be displayed during the call. In addition, for your reference, our quarterly investor handout is available for download in a PDF file on our website at Cameco dot com. Today's conference call is open to all members of the investment community, including the media. During the QA session, please limit yourself to two questions and then return to the queue. Please note that this conference call will include forward-looking information which is based on a number of assumptions, and actual results could differ materially. Please refer to our annual informat formion and MDNA for more information about the factors that could cause these different results and the assumptions we have made. With that, I will turn it over to Tim.

Tim Gitzel: Well Thank you Richelle, and good morning everyone. We appreciate you joining us on our call today.

Tim Gitzel: Well, thank you, Rachelle, and good morning, everyone. We appreciate you joining us on our call today. I want to start today by expressing our shock and sadness with the events taking place in Ukraine and our solidarity and support for the Ukrainian people. I had the opportunity to have a video conference yesterday with our Ukrainian customers in Kyiv, at which time I thanked them for the courage and resilience they've shown over the past several months. We can only hope and pray for a speedy resolution of this unnecessary conflict. Last quarter, we indicated that we believed we were in the early innings of a security of supply-driven market transition, demonstrated by our contracting success, a growing pipeline of discussions with our customers, and rising uranium prices. A transition supported by the fundamentals. Fundamentals characterized by durable, full cycle demand against the backdrop of an uncertain supply picture.

Speaker 8: I want to start today by expressing our shock and sadness with the events taking place in Ukraine and our solidarity in support for the Ukrainian people.

Tim Gitzel: I had the opportunity to have a video conference yesterday with our Ukrainian customers and Kyiv.

Tim Gitzel: At which time I thanked them for the courage and resilience they've shown over the past several months.

Tim Gitzel: We can only hope and pray for a speedy resolution of this unnecessary conflict.

Tim Gitzel: Last quarter we indicated that we believed we were in the early innings of a security of supply-driven market transition, demonstrated by our contracting success.

Tim Gitzel: A growing pipeline of discussions with our customers and rising uranium prices.

Tim Gitzel: A transition supported by the fundamentals.

Tim Gitzel: Fundamental is characterized by durable full-cycle demand against the backdrop of an uncertain supply picture.

Tim Gitzel: Stemming from these fundamentals and our contracting success, we had the confidence to proceed with the next phase of our supply discipline, which is now well underway. I'll provide some details on that a bit later. What we didn't know when we made our decision to proceed with the next phase of our supply discipline was the pace of change that would occur in our industry because of geopolitical events that are further amplifying security of supply concerns. It's still early days, but we are seeing what we believe is an unprecedented geopolitical realignment occurring in the nuclear fuel cycle. Thanks to the strategic and deliberate decisions Cameco has made over the past decade, the company is extraordinarily well positioned in this rapidly changing market. As always, we will take a balanced and disciplined approach.

Tim Gitzel: Stemming from these fundamentals and our contracting success, we had the confidence to proceed with the next phase of our supply discipline, which is now well underway.

Tim Gitzel: I'll provide some details on that a bit later.

Tim Gitzel: But we didn't know when we made our decision to proceed with the next phase of our supply discipline.

Tim Gitzel: Was the pace of change that would occur in our industry because of geopolitical events that are further amplifying security of supply concerns.

Tim Gitzel: It's still early days, but we are seeing what we believe is an unprecedented geopolitical realignment occurring in the nuclear fuel cycle.

Tim Gitzel: Thanks to the strategic and deliberate decisions Cameco has made over the past decade, the company is extraordinarily well positioned in this rapidly changing market.

Tim Gitzel: But as always, we will take a balanced and disciplined approach.

Tim Gitzel: Look at the changes in our market in more detail, starting with demand.

Tim Gitzel: Let's look at the changes in our market in more detail, starting with demand. We've talked before about how the benefits of nuclear energy have come clearly into focus with a durability that we believe has not previously been seen. A durability that is being driven by the accountability for achieving the net zero carbon targets being set by countries and companies around the world. You know, I saw a figure just the other day that 90% of the world's economy is now covered by net zero targets. Net zero targets that are turning attention to a triple challenge. First is to lift one-third of the global population out of energy poverty by expanding the availability of clean and reliable baseload electricity. Second is to replace 85% of the current global electricity grids that run on carbon emitting thermal power with a clean, reliable alternative.

Tim Gitzel: We've talked before about how the benefits of nuclear energy have come clearly into focus, with a durability that we believe has not previously been seen.

Tim Gitzel: The durability that is being driven by the accountability for achieving the net zero carbon targets being set by countries and companies around the world.

Tim Gitzel: You I saw figure just the other day that 90%, 90% of the world's economy is now covered by net zero targets.

Tim Gitzel: Net zero targets that are turning attention to a triple challenge.

Tim Gitzel: First is to lift onethird of the global population out of energy poverty by expanding the availability of clean and reliable baseload electricity.

Tim Gitzel: Second is to replace 85% of the current global electricity grids that run on carbon emitting thermal power with a clean, reliable alternative.

Tim Gitzel: Finally, the challenge is to grow global power grids by switching industries to electricity, such as private and commercial transportation, home and industrial heating, which today are largely powered with carbon emitting thermal energy. If that wasn't challenging enough, we can add to the list solving the energy crisis experienced in some parts of the world while pivoting away from reliance on Russian energy without jeopardizing those net zero commitments. Therefore, not surprising that concerns about energy security are amplified and at the top of the list for many countries, creating further pressure for governments to reexamine their energy policy decisions. Policymakers around the world are recognizing that in their drive for a clean energy profile, they have forgotten to balance their other objectives, like providing an affordable levelized cost profile and providing a reliable and secure baseload profile.

Tim Gitzel: And finally, the challenge is to grow global power grids by switching industries to electricity.

Tim Gitzel: Such as private and commercial transportation, home and industrial heating, which today are largely powered with carbon emitting thermal energy.

Tim Gitzel: If that wasn't challenging enough, we can add to the list solving the energy crisis experienced in some parts of the world, while pivoting away from reliance on Russian energy, without jeopardizing those net zero commitments.

Tim Gitzel: Therefore not surprising that concerns about energy security are amplified and at the top of the list for many countries.

Tim Gitzel: Creating further pressure for governments to reexamine their energy policy decisions.

Tim Gitzel: Policymakers around the world are recognizing that, in their drive for a clean energy profile, they have forgotten to balance their other objectives, like providing an affordable leveliised cost profile.

Tim Gitzel: Providing a reliable and secure base load profile.

Tim Gitzel: Too much focus on intermittent weather dependent renewable energy has left some jurisdiction struggling with power shortages and spiking energy prices, or a dependence on Russian energy supplies.

Tim Gitzel: Too much focus on intermittent, weather-dependent renewable energy has left some jurisdictions struggling with power shortages and spiking energy prices or a dependence on Russian energy supplies. The good news for us is that in their quest to restore balance or pivot away from Russia, many are turning now to nuclear. Nuclear power fits nicely at the center of that policy triangle, providing safe, affordable, carbon-free baseload electricity that has a clean emissions profile while also being reliable and secure. Which is why in the US, the Biden administration just announced a $6 billion effort to secure nuclear power plants at risk of closing. Something I never thought possible just a few years ago, the governor of California announced that he will seek funding under this plan to prevent the closure of Diablo Canyon.

Tim Gitzel: The good news for us is that, in their quest to restore balance or pivot away from Russia, many are turning now to nuclear.

Tim Gitzel: Nuclear power fits nicely at the center of that policy triangle, providing safe affordable, carbon-free based load electricity that has a clean emissions profile while also being reliable and secure.

Tim Gitzel: Which is why, in the? US, the Biden administration just announced a $6 billion effort to secure nuclear power plants at risk of closing.

Tim Gitzel: And something I never thought possible just a few years ago. The governor of California announced that he will seek funding under this plan to prevent the closure of Diablo Canyon.

Tim Gitzel: It's why, in the British energy security strategy released in early April , the United Kingdom outlined its plans to reduce dependence on Russian oil and natural gas by building eight new nuclear plans.

Tim Gitzel: It's why in the British Energy Security Strategy, released in early April, the United Kingdom outlined its plans to reduce dependence on Russian oil and natural gas by building eight new nuclear plants. One new plant a year, as we heard the British Prime Minister say this week. It's why recently reelected President Emmanuel Macron of France committed to 14 new reactors and life extensions for its existing fleet. It's also why the European Commission accepted nuclear energy in its green energy taxonomy. It's why recently elected President Yoon of South Korea plans to reverse the nuclear phase-out policy of the previous government and stated that nuclear energy should be the base load electricity source in South Korea for the next 60 years, and that South Korea should export its technology outside of its borders.

Tim Gitzel: one new plant a year, as we heard the British Prime Minister say this week.

Tim Gitzel: It's why. Recently reelected President Emmanuel Macron of France committed to 14 new reactors and life extensions for its existing fleet.

Tim Gitzel: Also why the European Commission accepted nuclear energy in its green energy taxonomy.

Tim Gitzel: It's whyide recently elected President Yoon of South Korea plans to reverse the nuclear phase-out policy of the previous government.

Tim Gitzel: And stated that nuclear energy should be the base load electricity source in South Korea for the next 60 years.

Tim Gitzel: And that South Korea should export its technology outside of its borders.

Tim Gitzel: It's why we've seen Belgium announce plans for 10-year life extensions for its 2 newest reactors. That Germany, yes, even Germany, in fact, could reconsider its own nuclear phase-out plans. The growth in demand is not just long-term in the form of new builds; it is full-cycle demand. There's near-term growth as early reactor retirements are prevented, and there's medium-term demand in the form of reactor life extensions. There's also momentum building for nontraditional commercial uses of nuclear power around the world, such as development of small modular reactors, and advanced reactors with numerous companies and countries pursuing projects. Things are moving very quickly in our industry, and we're seeing countries and companies turn to nuclear with an appetite that I'm not sure I've ever seen in my four decades in this business.

Tim Gitzel: While we've seen Belgium announced plans for ten-year life extensions for its two newest reactors.

Tim Gitzel: And that Germany yes, even Germany in fact, could reconsider its own nuclear phase-out plans.

Tim Gitzel: The growth in demand is not just long-term in the form of new builds, it is full-cycle demand.

Tim Gitzel: There's near-term growth, as early reactor retirements are prevented, and there's medium-term demand in the form of reactor life extensions.

Tim Gitzel: There's also momentum building for nontraditional commercial uses of nuclear power around the world, such as development of small modular reactors and advanced reactors, with numerous companies and countries pursuing projects.

Tim Gitzel: So things are moving very quickly in our industry and we're seeing countries and companies turn to nuclear with an appetite that I'm not sure I've ever seen in my four decades in this business.

Tim Gitzel: Therefore, it's easy to conclude that the demand outlook is durable and very bright. Supply is quite a different picture. For some time now, we've said that we believe the uranium market was as vulnerable to a supply shock as it has ever been due to persistently low prices, low prices that have led to planned supply curtailments of existing productive capacity, development risk due to lack of investment in new productive capacity, the end of reserve life for some mines, the deepening geopolitical and origin risk driven by the increasing concentration of supply, and the trend toward regionalization to ensure the availability of critical minerals. Unlike in the past, we don't have the same stock of secondary supplies to fill the gap.

Tim Gitzel: Therefore it's easy to conclude that the demand outlook is durable and very bright.

Tim Gitzel: But supply is quite a different picture.

Tim Gitzel: For some time now, we've said that we believe the uranium market was as vulnerable to a supply shock as it has ever been, due to persistently low prices.

Tim Gitzel: Low prices that have led to planned supply curtailments of existing productive capacity.

Tim Gitzel: Development risk due to lack of investment in new productive capacity.

Tim Gitzel: The end of reserve life for some mines.

Tim Gitzel: Deepening geopolitical and origin risk driven by the increasing concentration of supply.

Tim Gitzel: And the trend toward regionalization to ensure the availability of critical minerals.

Tim Gitzel: And unlike in the past, we don't have the same stock of secondary supplies to fill the gap.

Tim Gitzel: After years of drawing on these one-time sources, the secondary supply capacity is now declining significantly into the future, and productive capacity is not poised to respond. These fundamental facts have been amplified by both unplanned supply disruptions caused by the COVID-19 pandemic and by global supply chain and inflationary challenges that are not only interrupting the flow of goods and services in the uranium market but also increasing costs. I was at a meeting of business leaders just the other day where it was said that if you have a feasibility study that is more than a few months old, you might as well toss it and start over. Supply challenges have been further intensified by the thinning of the spot market due to the interest in physical uranium by investors.

Tim Gitzel: After years of drawing on these onetime sources, the secondary supply capacity is now declining significantly.

Tim Gitzel: Into the future and productive capacity is not poised to respond.

Tim Gitzel: These fundamental facts have been amplified by both unplanned supply disruptions caused by COVID-19 pandemic.

Tim Gitzel: And by global supply chain and inflationary challenges.

Tim Gitzel: That are not only interrupting the flow of goods and services in the uranium market.

Tim Gitzel: But also increasing costs.

Tim Gitzel: Was without a meeting of business leaders just the other day where it was said that if you have a feasibility study that is more than a few months old.

Tim Gitzel: You might as well toss it and start over.

Tim Gitzel: Supply challenges have been further intensified by the sending of the spot market due to the interest in physical uranium by investors.

Tim Gitzel: particular, I am referring to the Sprott Uranium Trust that are purchasing significant volumes of uranium and sequestering it, by the increasing ESG scrutiny of utilities to ensure their supply chains meet the standards for all three factors, by the unrest in Kazakhstan in early January that raised concerns about the security of about 45% of global uranium supply. Then in February, the tragic Russian invasion of Ukraine, which sent a shiver down the spines of nuclear fuel buyers around the world. Currently, the global nuclear industry relies on Russia for approximately 14% of its supply of uranium concentrates, 27% of conversion supply, and 39% of enrichment capacity. Many jurisdictions have imposed strict economic sanctions on Russia, including Canada, the United States, the European Union, and the United Kingdom, among others.

Tim Gitzel: Particular I am referring to the Sprott Uranium Trust.

Tim Gitzel: That are purchasing significant volumes of uranium and sequestering it.

Tim Gitzel: By the increasing ESG scrutiny of utilities to ensure their supply chains meet the standards for all three factors.

Tim Gitzel: By the unrest in Kazakhstan in early January that raised concerns about the security of about 45% of global urraniian supply.

Tim Gitzel: And then, in February , the tragic Russian invasion of Ukraine.

Tim Gitzel: Which sent to shivever down the spines of nuclear fuel buyers around the world.

Tim Gitzel: Currently the global nuclear industry relies on Russia for approximately 14% of its supply of uranium concentrates. 27% of conversion supply and 39% of enrichment capacity.

Speaker 8: 27% of conversion supply and 39% of enrichment capacity.

Tim Gitzel: Many jurisdictions have imposed strict economic sanctions on Russia, including Canada, the United States, the European Union and the United Kingdom, among others.

Tim Gitzel: In addition to economic sanctions, many countries, including the US, have sanctioned or are considering sanctioning imports of Russian energy, including oil, natural gas, and coal. With the continued conflict, there is also growing uncertainty about the ability to continue to rely on nuclear fuel supplies coming out of Russia, whether as a result of sanctions or because of a conflict with company values. In fact, we've seen some utilities voluntarily pivot away from Russian fuel supplies as they recognize the incongruency with their values and ESG principles. From our perspective, it's not a matter of if Western markets will turn their backs on Russian nuclear fuel supply, but rather when and how quickly.

Tim Gitzel: In addition to economic sanctions, many countries, including the US, have sanctioned or are considering sanctioning imports of Russian energy, including oil, natural gas and coal.

Tim Gitzel: With a continued conflict. There is also growing uncertainty about the ability to continue to rely on nuclear fuel supplies coming out of Russia.

Tim Gitzel: Whether as a result of sanctions or because of a conflict with company values.

Tim Gitzel: In fact, we've seen some utilities voluntarily pivot away from Russian fuel supplies as they recognize the incongruency with their values and ESG principles.

Tim Gitzel: From our perspective, it's not a matter of if Western markets will turn their backs on Russian nuclear fuel supply, but rather when and how quickly.

Tim Gitzel: Of course, there's also the risk that Russia preempts any actions by Western markets imposing its own voluntary export restraints in retaliation for economic and other sanctions, as we've seen them do with gas in parts of Europe. There's the uncertainty about the ability to ship uranium through Russian ports or the Black Sea, which could affect not only Russian supply, but also deliveries from Central Asia. While it is still technically possible to ship through Russia, due to insurance and other reasons, we've decided to delay a near-term delivery from Inkai in Kazakhstan while we work with our partner to establish an alternate shipping route. This could take some time, but we have the ability to mitigate the risk with inventory, long-term purchase commitments, and loans if necessary.

Tim Gitzel: Of course there is also the risk that Russia preempts any actions by Western markets, imposing its own voluntary export restraints in retaliation for economic and other sanctions, as we've seen them do with gas in parts of Europe .

Tim Gitzel: And then there is the uncertainty about the ability to ship uranium through Russian ports or the Black Sea, which could affect not only Russian supply but also deliveries from central Asia.

Tim Gitzel: While it is still technically possible to ship through Russia.

Tim Gitzel: Due to insurance and other reasons, we ve decided to delay a near-term delivery from Inkai in Kazakhstan, while we work with our partner to establish an alternate shipping route.

Tim Gitzel: This could take some time, but we have the ability to mitigate the risk with inventory, long-term purchase commitments and loans, if necessary.

Tim Gitzel: It's still early days and utilities are working their way through their fuel supply chains to determine where their vulnerabilities are. Already we're seeing some utilities begin to pivot toward procurement strategies that more carefully weigh the origin risk. Looking at where the market is today and the growing risk to supply and origin of supply, it's easy to conclude that the current nuclear fuel market is more positive than we have seen in a very long time. Let me turn to Cameco and our response to the changes in the market. As a commercial supplier, our decisions have uniquely positioned the company to capitalize on the increasingly undeniable conclusion that nuclear power must be an essential part of the clean energy transition, and even more so in a world where origins matter.

Tim Gitzel: It's still early days and utilities are working their way through their fuel supply chains. Determine where their vulnerabilities are.

Tim Gitzel: But already we're seeing some utilities: begin to pivot toward procurement strategies that more carefully weigh the origin risk.

Tim Gitzel: Looking at where the market is today, in the growing risk to supply an origin of supply, it's easy to conclude that the current nuclear fuel market is more positive than we have seen in a very long time.

Tim Gitzel: So let me turn to Cameco and our response to the changes in the market.

Tim Gitzel: As a commercial supplier. Our decisions have uniquely positioned the company to capitalize on the increasingly undeniable conclusion.

Tim Gitzel: The nuclear power must be an essential part of the clean energy transition, and even more so in a world where origins matter.

Tim Gitzel: With demonstrated tier one assets, strategic tier two assets, and vertical integration, we've taken a balanced and disciplined approach to our strategy of full cycle value capture. On the contracting front, we've been balanced and disciplined in layering in volumes where it makes sense for us and building a diversified customer base. With what we believe are the early innings of a market transition and more demand ahead of us, we will continue to be patient. We're not even close to being sold out, and so we will maintain considerable leverage to the further market improvements that we expect to see. We're also taking a balanced and disciplined approach to our supply decisions.

Tim Gitzel: With demonstrated Tier one assets, strategic Tier two assets and vertical integration.

Tim Gitzel: We've taken a balanced and disciplined approach to our strategy of full-cycle value capture.

Tim Gitzel: On the contracting front, we've been balanced and disciplined in layering in volumes where it makes sense for us and building a diversified customer base.

Tim Gitzel: But with what we believe are the early innings of a market transition and more demand ahead of us, we will continue to be patient.

Tim Gitzel: We're not even close to being sold out, And so we will maintain considerable leverage to the further market improvements that we expect to see.

Tim Gitzel: We're also taking a balanced and disciplined approach to our supply decisions.

Tim Gitzel: The next phase of our supply discipline, which involves not only MacArthur River/Key Lake, but starting in 2024 Cigar Lake, is balanced with our contract portfolio and where we think the market transition is currently at. Even though we've seen considerable pricing pressure resulting from the geopolitical uncertainty, we will not change our production plans. We will not front run demand with supply. We won't ramp up production to meet spot demand. We will ramp up once we've built the homes for those pounds in our long-term contract portfolio and we see further improvements in the uranium market. With all the uncertainty, we're not rushing this process. I think we've shown we can be trusted when we say we will remain disciplined. Finally, while we're talking about balance, we have shown balanced financial discipline.

Tim Gitzel: An next phase of our supply discipline, which involves not only McArthur River Key Lake but, starting in 2024, Cigar Lake.

Tim Gitzel: Is balanced with our contract portfolio and where we think the market transition is currently at.

Tim Gitzel: Even though we have seen considerable pricing pressure resulting from the geopolitical uncertainty, we will not change our production plans.

Tim Gitzel: We will not "front-run" demand with supply. We won't ramp up production to meet spot demand. We will wramp up once we've built the homes for those pounds in our long-term contract portfolio and we see further improvements in the uranium market.

Tim Gitzel: With all the uncertainty, we are not rushing this process.

Tim Gitzel: And I think we've shown we can be trusted when we say we will remain disciplined.

Tim Gitzel: Finally while we're talking about balance, we have shown balanced financial discipline.

Tim Gitzel: We will retain our conservative financial management to support our continued balanced and disciplined contracting and supply decisions. Let me take a minute to discuss where we're at with the next phase of our supply discipline. As we announced last quarter, we're laying claim to our tier one incumbency advantage as we further position Cameco to capture the value we expect to come from the growing demand for safe, clean, reliable, and affordable nuclear energy. We started the process to transition the McArthur River mine and the Key Lake Mill from care and maintenance to operational readiness. We've begun the recruiting and training process. Current workforce at these sites is now approximately 600, including employees and long-term contractors, with a view to achieving about 850 prior to the start of production later this year.

Tim Gitzel: We will retain our conservative financial management to support our continued balanced and disciplined contracting and supply decisions.

Tim Gitzel: Take a minute to discuss where we're wrapped with the next phase of our supply discipline.

Tim Gitzel: As we announced last quarter, we laying claim to our Tier one incumbency advantage as we further position Cameco to capture the value we expect to come from the growing demand for safe clean, reliable and affordable nuclear energy.

Tim Gitzel: We started the process to transition the MacArthur River mine and the Key Lake mill from care and maintenance to operational readiness.

Tim Gitzel: We've begun the recruiting and training process.

Tim Gitzel: Current workforce at these sites is now approximately 600, including employees and long-term contractors, with a view to achieving about 850 prior to the start of production later this year.

Tim Gitzel: Our maintenance readiness checks are underway, and we are completing the critical automation, digitization, and other projects needed to begin production. With the work we're undertaking this year, we could produce up to 5 million pounds on a 100% basis. Our current plan is to achieve production of 15 million pounds per year on a 100% basis by 2024. That is 40% below the annual license capacity. Once MacArthur River/Key Lake operation reaches its planned production starting in 2024, it's our intention to pull back on production at Cigar Lake. Our plan is to take production at Cigar Lake from 18 million pounds per year down to 13.5 million pounds per year on a 100% basis or 25% below its licensed capacity.

Tim Gitzel: Our maintenance readiness checks are underway and we are completing the critical automation, digitization and other projects needed to begin production.

Tim Gitzel: With the work we're undertaking this year, we could produce up to 5 million pounds on a 100% basis.

Tim Gitzel: Our current plan is to achieve production of 15 million pounds per year on 100% basis by 2024.

Tim Gitzel: That is, 40% below the annual license capacity.

Tim Gitzel: Once McArthur River Key Lake operation reaches its planned production, starting in 2024, it's our intention to pull back on production at Cigar Lake.

Tim Gitzel: Our plan is to take production at Cigar Lake from 18 million pounds per year down to 13.5 million pounds per year on a 100% basis, or 25% below its license capacity.

Tim Gitzel: This year we continue to expect to produce 15 million pounds at Cigar Lake on 100% basis, 3 million pounds less than its license capacity.

Tim Gitzel: This year, we continue to expect to produce 15 million pounds at Cigar Lake on a 100% basis, 3 million pounds less than its licensed capacity. Our production outlook this year reflects the expected impact of delays in development work at Cigar Lake in 2021 and the ongoing pandemic and supply chain challenges that are impacting the availability of materials, reagents, and labor at all of our operations, including labor negotiations that could impact production. However, we're working to minimize any disruption to our operations. So what's the result of all this? We expect that our operational decisions at McArthur River/Key Lake will have a significant and positive impact on our financial performance. As you know, the financial aspect of our strategy is to ensure we have a solid balance sheet and the ability to self-manage risk.

Tim Gitzel: Our production outlook this year reflects the expected impact of delays in development work at Cigar Lake in 2021 and the ongoing pandemic and supply chain challenges that are impacting the availability of materials, reagents and labour at all of our operations, including labour negotiations that could impact production.

Tim Gitzel: However we're working to minimize any disruption to our operations.

Tim Gitzel: What's a result of all this?

Tim Gitzel: We expect that our operational decisions at McArthur River Key Lake will have a significant and positive impact on our financial performance.

Tim Gitzel: As you know, the financial aspect of our strategy is to ensure we have a solid balance sheet and the ability to self-manage risk.

Tim Gitzel: the end of Q1, we're again in a net negative debt position with $1.5 billion in cash, about $1 billion in long-term debt and a $1 billion undrawn credit facility, and this doesn't include the $778 million owed to us by the CRA. Once production at the McArthur River/Key Lake operation resumes, we expect to begin to see a significant improvement in our earnings and cash flow. As production achieves a reasonable level, we will no longer expense operational readiness costs to cost of sales, and we will be able to source more of our committed sales from lower cost produced pounds. As we saw this quarter, the higher prices in the currently improving market are beginning to flow through our existing contract portfolio.

Tim Gitzel: The end of the first quarter, we again were in a net negative debt position.

Tim Gitzel: With $1.5 billion in cash, about one billion in long-term debt and a $1 billion undrawn credit facility.

Tim Gitzel: And this doesn't include the $778 million owed to us by the CRA.

Tim Gitzel: Once production at the McArthur River Key Lake operation resumes, we expect to begin to see a significant improvement in our earnings and cash flow.

Tim Gitzel: As production achieves a reasonable level, we will no longer expense operational readiness cost to cost of sales.

Tim Gitzel: And we'll be able to source more of our committed sales from lower-cost produced pounds.

Tim Gitzel: As we saw this quarter. The higher prices in the currently improving market are beginning to flow through our existing contract portfolio.

Tim Gitzel: With an inventory of unencumbered pounds in the ground, rising prices will also create the opportunity to layer in new long-term commitments with appropriate pricing mechanisms that will underpin the long-term operation of our productive capacity. We've also started to bring forward some of our long-term purchases. Remember that when uranium prices started with 2 or 3, we secured almost 13 million pounds of material under long-term fixed-price purchase arrangements. We have not taken delivery or paid for the majority of these pounds, so they're not on our balance sheet, but they are stored at our facility. The deliveries under these arrangements are heavily weighted to the years 2025 through 2028. However, we have the ability to bring these pounds forward and earn a good margin on them today. We put these arrangements in place as a means of risk mitigation.

Tim Gitzel: And with an inventory of unencumbered pounds in the ground. Rising prices will also create the opportunity to layer in new long-term commitments.

Tim Gitzel: Commitments with appropriate pricing mechanisms that will underpin the long-term operation of our productive capacity.

Tim Gitzel: We've also started to bring forward some of our long-term purchases.

Tim Gitzel: Remember that when uranium prices started with the two or 3, we secured almost 13 million pounds of material under long-term fixed price purchase arrangements.

Tim Gitzel: We have not taken delivery or paid for the majority of these pounds, So they're not on our balance sheet.

Tim Gitzel: But they are stored at our facility.

Tim Gitzel: The deliveries under these arrangements are heavily weighted to the year's 2025 through 2028.

Tim Gitzel: However we have the ability to bring these pounds forward and earn a good margin on them today.

Tim Gitzel: To put these arrangements in place as a means of risk mitigation.

Tim Gitzel: With the planned production changes at McArthur River/Key Lake and Cigar Lake, our need for these pounds to mitigate risk has been reduced. We will continue to balance this activity with our spot market purchases. As such, we expect to continue to have the financial capacity to execute on our strategy and self-manage risk, including from the global macroeconomic and geopolitical uncertainty we're seeing today. Having been in this business for a long time, we have been through every market transition in our industry. We understand that while having great assets is a necessary condition for creating long-term value, it's not sufficient. We also know that the spot market in our industry is not the fundamental market in our business. It is not where utilities turn to satisfy their long-term run rate requirements. It's typically where they go for one-time discretionary volumes.

Tim Gitzel: With the planned production changes at McArthur River Key Lake and Cigar Lake, our need for these pumps to mitigate risk has been reduced.

Tim Gitzel: We will continue to balance this activity with our spot market purchases.

Tim Gitzel: As such, we expect to continue to have the financial capacity to execute on our strategy and self-managed risk.

Tim Gitzel: Including from the global macroeconomic and geopolitical uncertainty we're seeing today.

Tim Gitzel: Having been in this business for a long time, we have been through every market transition in our industry.

Tim Gitzel: We understand that we'while having great assets is a necessary condition for creating long-term value.

Tim Gitzel: It's not sufficient. We also know that the spot market in our industry is not the fundamental market in our business.

Tim Gitzel: It is not where utilities turn to satisfy their long-term run rate requirements.

Tim Gitzel: It's typically where they go for one-time discretionary volumes.

Tim Gitzel: Our experience has taught us that a responsible producer creates real value by building a long-term contract portfolio.

Tim Gitzel: Our experience has taught us that a responsible producer creates real value by building a long-term contract portfolio, a portfolio that supports the operation of productive assets and generates significant cash flow through the entire commodity cycle by having leverage to greater returns as prices increase, and that provides downside protection for the periods of lower prices. In our business, there is no substitute for a full-blown, utility-driven, long-term contracting cycle. Contracting cycle motivated by security of supply concerns drives value capture in the uranium fuel market, just like it did in the conversion market two years ago, and as it did for us during the worst down cycle in the uranium business when our average realized price outperformed the market and protected our balance sheet when others failed financially and had to be recapitalized and restructured, destroying value for their owners.

Tim Gitzel: Portfolio that supports the operation of productive assets.

Tim Gitzel: That generates significant cash flow through the entire commodity cycle.

Tim Gitzel: By having leverage to greater returns as prices increase.

Tim Gitzel: And that provides downside protection for the periods of lower prices.

Tim Gitzel: In our business, there is no substitute for a full blown utility-driven long-term contracting cycle.

Tim Gitzel: Contracting cycle motivated by security of supply concerns, drives value capture in the urannum fuel market.

Tim Gitzel: Just like it did in the conversion market two years ago.

Tim Gitzel: And as it did for us during the worst down cycle in the uranium business, when our average realized price outperformed the market and protected our balance sheet, when others failed financially and had to be recapitalized and restructured, destroying value for their owners.

Tim Gitzel: Finally after more than 10 years in a trough and through the deliberate, disciplined execution of our strategy, we're seeing increased interest in contracting, and not just in uranium, but across the fuel cycle.

Tim Gitzel: Finally, after more than 10 years in a trough and through the deliberate and disciplined execution of our strategy, we're seeing increased interest in contracting, and not just in uranium, but across the fuel cycle. With geopolitics complicating and potentially bottlenecking nuclear fuel supplies, we're seeing not just utilities, but some of the intermediaries and service providers beginning to shift their attention to securing material for their uncovered requirements and to de-risk some of their origin dependencies. The requests for proposals we are seeing are directed at those producers who have proven and reliable productive capacity in the right jurisdictions and who have a track record of honoring commitments. As an independent commercial supplier, we can provide our customers with access to proven and reliable productive capacity, both uranium and fuel services, which is exactly what they want.

Tim Gitzel: With geopolitics complicating and potentially botlenecking nuclear fuel supplies.

Tim Gitzel: We're seeing not just utilities but some of the intermediaries and service providers.

Tim Gitzel: Beginning to ship their attention to securing material for their uncovered requirements and to derisk some of their origin dependencies.

Tim Gitzel: The requests for proposals we are seeing are directed that those producers who have proven and reliable productive capacity in the right jurisdictions and who have a track record of honoring commitments.

Tim Gitzel: As an independent commercial supplier, we can provide our customers with access to proven and reliable productive capacity, both uranium and fuel services.

Tim Gitzel: Which is exactly what they want.

Tim Gitzel: And with substantial Canadian productive capacity. Our supply meets both energy security and increasingly stringent ESG requirements that are table stakes today.

Tim Gitzel: With substantial Canadian productive capacity, our supply meets both energy security and increasingly stringent ESG requirements that are table stakes today. It can provide diversity from state-owned enterprises and help to de-risk utilities' future supply from geopolitical risk and trade policy exposure. What does all this mean for Cameco? Well, it means we are optimistic. We're optimistic about the growth and demand for nuclear power, both traditional and non-traditional. We're optimistic about the growth and demand for uranium and fuel services. We're optimistic about the incumbency opportunity for Cameco in capturing long-term value across the fuel cycle, including some of the vertical integration investments we've made. Therefore, we will continue to execute on the next phase of our supply discipline strategy, and more importantly, we will continue to do what we said we would do.

Tim Gitzel: And it can provide diversity from state-owned enterprises and help to derisk utilities future supply from geopolitical risk and trade policy exposure.

Tim Gitzel: So what does all this mean for Cameco? Well, it means we are optimistic.

Tim Gitzel: We're optimistic about the growth in demand for nuclear power, both traditional and nontraditional.

Tim Gitzel: We're optimistic about the growth in demand for uranium and fuel services.

Tim Gitzel: And we're optimistic about the incumbency opportunity for Cameco in capturing long-term value across the fuel cycle, including some of the vertical integration investments we've made.

Tim Gitzel: Therefore we will continue to execute on the next phase of our supply discipline strategy.

Tim Gitzel: And more importantly, we will continue to do what we said we would do.

Tim Gitzel: We have operating and idle Tier One assets that are licensed, permitted, long-lived, and are proven operations that have expansion capacity. We have fully permitted and proven Tier Two assets that don't make sense at today's prices. When you think about them in the context of a looming supply and origin gap, there's a potential pathway for them to add value for us in the future. We will continue to be very disciplined in our evaluation on that front. Thanks to our disciplined contracting strategy, we have a contract portfolio that has protected us well during the worst down cycle in our business. As the nuclear fuel market improves further, our focus is shifting to securing homes for our in-ground inventory and for our fuel services capacity that has not yet been committed.

Tim Gitzel: We have operating an idle Tier one assets that are licensed permitted, long lived in our proven operations that have expansion capacity.

Tim Gitzel: We have fully permitted and proven peer two assets that don't make sense at today's prices.

Tim Gitzel: But when you think about them in the context of a looming supply and origin gap.

Tim Gitzel: There's a potential pathway for them to add value for us in the future.

Tim Gitzel: But we will continue to be very disciplined in our evaluation on that front.

Tim Gitzel: Thanks to our disciplined contracting strategy, we have a contract portfolio that has protected us well during the worst down cycle in our business.

Tim Gitzel: As the nuclear fuel market improves further, our focus is shifting to securing homes for our in-ground inventory and for our fuel services capacity. That has not yet been committed.

Tim Gitzel: We are not going to chase the market down to win business and we won't produce to dump uncommitted supply into a thinly traded spot market, as we have seen some of our competitors do.

Tim Gitzel: We are not going to chase the market down to win business, and we won't produce to dump uncommitted supply into a thinly traded spot market as we have seen some of our competitors do. The primary driver for our contracting activity is always value. Therefore, as the market improves, we expect to continue to layer in volumes capturing greater upside using market-related pricing mechanisms. That said, we recognize there is cyclicality to our business that is inevitable. As a responsible producer, we will also look to lock in value at higher prices to carry those higher prices through the next cycle, just like we locked in significant value for our fuel services business in the recent price transition and conversion. Just a reminder, we're more than just mining. We are vertically integrated across the nuclear fuel cycle with refining, conversion, and fuel fabrication.

Tim Gitzel: The primary driver for our contracting activity is always value.

Tim Gitzel: Therefore as the market improves, we expect to continue to layer in volumes, capturing greater upside using market-related pricing mechanisms.

Tim Gitzel: That said, we recognize our cyclicality to our business. That is inevitable.

Tim Gitzel: So as a responsible producer, we will also look to lock in value at higher prices to carry those higher prices through the next cycle.

Tim Gitzel: Just like we locked in significant value for our fuel services business and the recent price transition in conversion.

Tim Gitzel: And just a reminder: we're more than just mining.

Tim Gitzel: We are vertically integrated across the nuclear fuel cycle, with refining, conversion and fuel fabrication.

Tim Gitzel: As utilities look to secure access to nuclear fuel supplies in jurisdictions that are stable, reliable, and politically dependable, we will also look to continue to build our fuel services contract book. We're looking to expand our reach through our fuel manufacturing capabilities and investment in Global Laser Enrichment. We're exploring fabrication of new fuels, including High-Assay Low-Enriched Uranium, or HALEU. In a world where access to Russian enrichment is restricted, this investment becomes increasingly valuable to us. In time, it not only has potential as a US source of enrichment capacity, but also to be a significant US source of conversion and to produce HALEU. We're also participating in the development of Small Modular Reactors and have entered a number of non-binding arrangements to advance their commercialization and deployment in Canada and around the world.

Tim Gitzel: As utilities. Look to secure access to nuclear fuel supplies and jurisdictions that are stable, reliable and politically dependable.

Tim Gitzel: We will also look to continue to build our fuel services contract book.

Tim Gitzel: And we're looking to expand our reach through our fuel manufacturing capabilities and investment in global laser enrichment. We're exploring fabrication of new fuels.

Tim Gitzel: Including High-Assay Low-Enriched Uranium or HALEU

Tim Gitzel: In a world where access to Russian enrichment is restricted, this investment becomes increasingly valuable to us.

Tim Gitzel: In time, it not only has potential as a US source of enrichment capacity.

Tim Gitzel: But also to be a significant? U's source of conversion and to produce HALEU.

Tim Gitzel: We're also participating in the development of small modular reactors and have entered a number of non-binding arrangements to advance their commercialization and deployment in Canada and around the world.

Tim Gitzel: We have an interest in the nuclear sustainability service, the back end of the fuel cycle, including aiding in the responsible cleanup of enrichment facilities no longer in operation. These opportunities align with our commitment to manage our business responsibly and sustainably and to increase our contribution to global climate change solutions. Our decisions at Cameco are deliberate. We are a responsible, commercially motivated supplier with a diversified portfolio of assets, including a tier one production portfolio that is among the best in the world. We're committed to operating sustainably by protecting, engaging, and supporting the development of our people and their communities, and to protecting the environment, something we've been doing for over 30 years.

Tim Gitzel: And we have an interest in the nuclear sustainability service, the back end.

Tim Gitzel: Of the fuel cycle, including aiding in the responsible cleanup of enrichment facilities no longer in operation.

Tim Gitzel: These opportunities align with our commitment to manage our business responsibly and sustainably.

Tim Gitzel: And to increase our contribution to global climate change solutions.

Tim Gitzel: Our decisions are Cameco are deliberate.

Tim Gitzel: We are a responsible, commercially motivated supplier with a diversified portfolio of assets, including a Tier one production portfolio that is among the best in the world.

Tim Gitzel: We're committed to operating sustainably by protecting, engaging and supporting the development of our people and their communities, and to protecting the environment, something we've been doing for over 30 years.

Tim Gitzel: Our strategy, which includes contracting discipline, supply discipline, and financial discipline, will allow us to achieve our vision, a vision of energizing a clean air world and thereby delivering long-term value in a market where demand for safe, secure, reliable, and affordable clean nuclear energy is growing. Thanks to all of you for your interest today, and we're happy to take any questions you might have.

Tim Gitzel: Our strategy, which includes contracting discipline, supply discipline and financial discipline, will allow us to achieve our vision.

Tim Gitzel: A vision of energizing the clean air world and thereby delivering long-term value in a market where demand for safe secure, reliable and affordable clean nuclear energy is growing.

Tim Gitzel: So thanks to all of you for your interest today, and we're happy to take any questions you might have.

Operator: We will now begin the question-and-answer session. In the interest of time, we ask you to lim your question to 1, with one supplemental. If you have additional questions, you are welcome to rejoin the queue. Join the question queue. you will press star than one on your telephone key pad you will hear a tone acknowledging your request. If you're using a speaker phone, Please pick up your handset before pressing any key. To withdraw your question. Please press star then two. Webcast. Participants are welcome to submit their questions through the box at the bottom of the webcast frame. The Cameco Investor Relations team will follow up with you by e-mail after the call. Once again. Anyone on the conference call who wishes to ask a question may press st than one at this time.

Operator: We will now begin the question and answer session. In the interest of time, we ask you to limit your questions to one, with one supplemental. If you have additional questions, you are welcome to rejoin the queue. To join the question queue, you may press star then one on your telephone keypad. You will hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then two. Webcast participants are welcome to submit their questions through the box at the bottom of the webcast frame. The Cameco investor relations team will follow up with you by email after the call. Once again, anyone on the conference call who wishes to ask a question may press star then one at this time. The first question is from Ralph Profiti with Eight Capital.

Speaker 14: If you have additional questions, you are welcome to rejoin the queue. Join the question Q. you will press star than one on your telephone ke ad you will hear a tone acknowledging your request. If you're using a speaker phone, Please pick up your handset before pressing any key.

Speaker 14: Join the question Q. you will press star than one on your telephone ke ad you will hear a tone acknowledging your request. If you're using a speaker phone, Please pick up your handset before pressing any key.

Speaker 14: To withdraw your question. Please press AR then two.

Speaker 14: Webcast. Participants are welcome to submit their questions through the box at the bottom of the webcast frame. The commaco-investor Relations team will follow up with you by e-mail after the call.

Speaker 14: Once again. Anyone on the conference call who wishes to ask a question may press st than one at this time.

Operator: The first question is from: Ralph Profiti with Eight Capital, Please go ahead.

Operator: Please go ahead.

Ralph M. Profiti: Good morning, Tim and team. Thanks for taking my questions.

Ralph Profiti: Good morning, Tim and team. Thanks for taking my questions. Tim, getting to 600 out of the 850 employees at McArthur River, it sounds like things are going very well, and according to plan. I'm just wondering where you're seeing the biggest challenges when it comes to securing some of that skilled labor in what looks to be an extremely competitive market, and as you move closer to, you know, full operational status. Is that CAD 40 million in Q1, sort of how does that compare to plan?

Ralph M. Profiti: Tim getting to 600 out of 850 employees at macarthur River. It sounds like things are going very well and according to plan. I'm just wondering where you're seeing the biggest challenges when it comes. A securing some of that skilled labor and what looks to be an extremely competitive market. And and as you move closer to. Full operational status. And is that four million in Q1 sort of? How does that compare to plan? Tim Gitzel Yeah, Ralph, thanks for the question. Nice to talk to you this morning. So yeah, we're ramping up. We're - we went from less than 200 people a while ago, we were at 600 on our way to 850. And it's not perfectly easy. We - I will say we have a competitive advantage in Northern Saskatchewan in that we have all of the northern people that have worked for us in the past. A great workforce represents 50% to 55% of our workforce. That will come back to us every time. So there's your advantage right off the bat. There's a few of the trades that are a little trickier to find. There's some competition here. Obviously, you see the potash business running hard, the oil and gas picking up drilling. So yes, there's competition. But we take from others and down the line. And we consider ourselves to be a pretty attractive place to work, a good employer. And so we'll be able to fill those positions. And we're not just doing it like that. We're also putting a diversity lens on it as well. We're looking to get more gender diversity, which will help us a lot in the long run. It's something we've been putting a real focus on and just underrepresented groups. So we'll get there. The people will come and we'll be okay on the labor side. The costs in the quarter are about exactly where we thought they would be. So that's going well. Ralph Profiti Okay. That's great to hear. I want to switch gears a little bit and talk about committed versus non-committed. And I hear you loud and clear on your comments about not being even close to being sold out. And I just want to maybe take a look at the shorter-term horizon, maybe 5 years. And what are you telling us between committed and open non-committed on that shorter-term horizon? Are you where you want to be in that split, save just for the next 5 years? Tim Gitzel Yeah. So I'll just give you the broad outline and then Grant, he might as well give a bit of an update on the market and where things are at, Ralph. But we like where we're at. We - I think over the next 5 years, we have about 20 million pounds per year on average on our books about where we want to be more in the first couple of years and declining. That's - boy, that's exactly where we want to be. We probably could put a lot more. If we just wanted to go for volume, Grant, we could put a lot more on the books. We're looking for value long term. And as we said in the comments just a few minutes ago, there's nothing like a security supply-driven market transition and signing contracts with great customers for a term, it's 5 or 10 years. We've been through some pretty rough patches, and we don't want to be there again. So Grant, why don't I pass it to you, and you can just give a bit of an update on the market as well, so we can cover that off. Grant Isaac Good morning, Ralph. Just let me cover a bit of ground that's already been covered. The - when we - we've been through every one of these cycles that the commercial industry has seen and learned a lot of things along the way. We're looking at a demand fundamental that is very constructive for all the reasons Tim went through. That demand fundamental has been leveraged by financial interest, which has been very positive. This year, early this year, it was leveraged by, quite frankly, the unrest in Kazakhstan, which then created a little more concern about the concentration of supply and then most recently leveraged by the Russian Invasion. That backdrop looks really constructive to us. And it tells us that there is a lot of demand that's still in front of Cameco demand, we don't have to chase. I characterize the term market in Q4 as being one where we were seeing tenors [ph] increase. We were seeing long-term contracts go from sort of 2 to 5 year bites out of the market to 2 to 7 years, 2 to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 2030s and through the 2030, that's very constructive. And we were seeing volumes go up, not just because tenors were going up, but bigger bites were being taken out of the market. But since February 24th, we've seen actually a new move in the term market, and that is this what we call Russian replacement demand.

Speaker 15: I'm just wondering where you're seeing the biggest challenges when it comes.

Speaker 15: A securing some of that skilled labor and what looks to be an extremely competitive market. And and as you move closer to.

Speaker 15: And and as you move closer to.

Speaker 15: Full operational status. And is that four million in Q1 sort of? How does that compare to plan?

Multiple speakers: Ralph Profiti Good morning, Tim and team. Thanks for taking the questions. Tim, getting to 600 out of the 850 employees at McArthur River, it sounds like things are going very well and according to plan. I'm just wondering where you're seeing the biggest challenges when it comes to securing some of that skilled labor in what looks to be an extremely competitive market, and as you move closer to full operational status. And is that $40 million in Q1, sort of how does that compare to plan? Tim Gitzel Yeah, Ralph, thanks for the question. Nice to talk to you this morning. So yeah, we're ramping up. We're - we went from less than 200 people a while ago, we were at 600 on our way to 850. And it's not perfectly easy. We - I will say we have a competitive advantage in Northern Saskatchewan in that we have all of the northern people that have worked for us in the past. A great workforce represents 50% to 55% of our workforce. That will come back to us every time. So there's your advantage right off the bat. There's a few of the trades that are a little trickier to find. There's some competition here. Obviously, you see the potash business running hard, the oil and gas picking up drilling. So yes, there's competition. But we take from others and down the line. And we consider ourselves to be a pretty attractive place to work, a good employer. And so we'll be able to fill those positions. And we're not just doing it like that. We're also putting a diversity lens on it as well. We're looking to get more gender diversity, which will help us a lot in the long run. It's something we've been putting a real focus on and just underrepresented groups. So we'll get there. The people will come and we'll be okay on the labor side. The costs in the quarter are about exactly where we thought they would be. So that's going well. Ralph Profiti Okay. That's great to hear. I want to switch gears a little bit and talk about committed versus non-committed. And I hear you loud and clear on your comments about not being even close to being sold out. And I just want to maybe take a look at the shorter-term horizon, maybe 5 years. And what are you telling us between committed and open non-committed on that shorter-term horizon? Are you where you want to be in that split, save just for the next 5 years? Tim Gitzel Yeah. So I'll just give you the broad outline and then Grant, he might as well give a bit of an update on the market and where things are at, Ralph. But we like where we're at. We - I think over the next 5 years, we have about 20 million pounds per year on average on our books about where we want to be more in the first couple of years and declining. That's - boy, that's exactly where we want to be. We probably could put a lot more. If we just wanted to go for volume, Grant, we could put a lot more on the books. We're looking for value long term. And as we said in the comments just a few minutes ago, there's nothing like a security supply-driven market transition and signing contracts with great customers for a term, it's 5 or 10 years. We've been through some pretty rough patches, and we don't want to be there again. So Grant, why don't I pass it to you, and you can just give a bit of an update on the market as well, so we can cover that off. Grant Isaac Good morning, Ralph. Just let me cover a bit of ground that's already been covered. The - when we - we've been through every one of these cycles that the commercial industry has seen and learned a lot of things along the way. We're looking at a demand fundamental that is very constructive for all the reasons Tim went through. That demand fundamental has been leveraged by financial interest, which has been very positive. This year, early this year, it was leveraged by, quite frankly, the unrest in Kazakhstan, which then created a little more concern about the concentration of supply and then most recently leveraged by the Russian Invasion. That backdrop looks really constructive to us. And it tells us that there is a lot of demand that's still in front of Cameco demand, we don't have to chase. I characterize the term market in Q4 as being one where we were seeing tenors [ph] increase. We were seeing long-term contracts go from sort of 2 to 5 year bites out of the market to 2 to 7 years, 2 to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 2030s and through the 2030, that's very constructive. And we were seeing volumes go up, not just because tenors were going up, but bigger bites were being taken out of the market. But since February 24th, we've seen actually a new move in the term market, and that is this what we call Russian replacement demand.

Tim Gitzel: Yeah Ralph, Thanks thanks for the question nice to talk to you this morning. So yeah we're, we're ramping up, we're. We went from less than 200 people a while ago. We're aftertowards 600 on our way 850, and you know it's not, it's not perfectly easy. we- I will say we- have a competitive advantage in Northern Saskatchewan when in that we have all of the Northern people that have work for us in the past, a great workforce representents 50 to 55 percent of our workforce. That will come back to us every time. So there's your advantage right off to bat. There's a few of the trades that are little trick here to find. There's some competition here, obviously. See the potash business running hard, oil and gas, picking up, drilling. So yes, there's competition. But you know we take from.. from others and down the line and we consider ourselves to be pretty attractive place to work, a good employer, And so we'll be able to fill those positions and we-', re- we're not just doing it like that, we're also putting a diversity lens on it as well. We're, we're looking to get more gender diversity, which will help us a lot in the long run at something we've been putting a real focus on and just under represented group. So we'll get there, the people will come and and we'll be okay. On the labour side, the costs in the quarter are about exactly where we thought they would be. So that's, that's going well. Okay. That's great to hear. I want to switch gears a little bit and talk about committed versus non-committed. And I hear you loud and clear on your comments about not being even close to being sold out. And I just want to maybe take a look at the shorter-term horizon, maybe 5 years. And what are you telling us between committed and open non-committed on that shorter-term horizon? Are you where you want to be in that split, save just for the next 5 years?

Tim Gitzel: Yeah, Ralph, thanks for the question. Nice to talk to you this morning. Yeah, we're ramping up. We went from less than 200 people a while ago. We're at 600 on our way to 850. You know, it's not perfectly easy. I will say we have a competitive advantage in northern Saskatchewan in that we have all of the northern people that have worked for us in the past. A great workforce represents 50% to 55% of our workforce. That'll come back to us every time. There's your advantage right off the bat. There's a few of the trades that are a little trickier to find. There's some competition here, obviously. You see the potash business running hard, oil and gas, picking up, drilling.

Tim Gitzel: Yes, there's competition, but you know, we take from others and down the line. We consider ourselves to be a pretty attractive place to work, a good employer. We'll be able to fill those positions. We're not just doing it like that. We're also putting a diversity lens on it as well. We're looking to get more gender diversity, which will help us a lot in the long run. It's something we've been putting a real focus on and just underrepresented groups. We'll get there. The people will come and we'll be okay on the labor side. The costs in the quarter are about exactly where we thought they would be. That's going well.

Tim Gitzel: to hear. I want to switch gears a little bit and talk about committed versus non-committed. And I hear you loud and clear on your comments about not being even close to being sold out. And I just want to maybe take a look at the shorter-term horizon, maybe 5 years. And what are you telling us between committed and open non-committed on that shorter-term horizon? Are you where you want to be in that split, save just for the next 5 years?

Ralph Profiti: Okay. That's great to hear. I wanna switch gears a little bit and talk about, you know, committed versus non-committed. I hear you loud and clear on, you know, your comments about not being even close to being sold out.

Ralph M. Profiti: Okay that's. That's great to hear. I want to switch gears a little bit and talk about. You know committed versus non-committed and I hear you loud and clear on. You know your're comments about. Not being even close to being sold out, and I just want to maybe take a look at the short term horizon- maybe five years. And. You know what are you telling us between? Committed and open, noncommitted on that shorter-term horizon. Are you where you want to be in that split save just for the next five years? Yeah, so I'll give you the broad outline and Grant you might as well give a bit of an update on the market were things are at now. We like were where at. We, I think over the next 5 year we have about 20 million pound per year on average on our books about were we want to be more in the first couple of years declining thats boy thats exactly were we want to be. We could put more alot more if we were just going for volume Grant, we could put alot more on the books.

Speaker 15: You know committed versus non-committed and I hear you loud and clear on. You know your're comments about.

Speaker 15: Not being even close to being sold out, and I just want to maybe take a look at the short term horizon- maybe five years.

Tim Gitzel: Yeah.

Ralph Profiti: I just wanna maybe take a look at the shorter term horizon, maybe five years.

Tim Gitzel: Yeah.

Ralph Profiti: you know, what are you telling us, between committed and open non-committed on that shorter term horizon? Are you where you want to be in that split, say just for the next five years?

Tim Gitzel: Yeah.

Speaker 15: And.

Speaker 15: You know what are you telling us between?

Speaker 17: Committed and open, noncommitted on that shorter-term horizon. Are you where you want to be in that split save just for the next five years?

Ralph M. Profiti: Yeah, so I'll give you the broad outline and Grant you might as well give a bit of an update on the market were things are at now. We like were where at. We, I think over the next 5 year we have about 20 million pound per year on average on our books about were we want to be more in the first couple of years declining thats boy thats exactly were we want to be. We could put more alot more if we were just going for volume Grant, we could put alot more on the books.

Tim Gitzel: Yeah. I'll just give you the broad outline, and then Grant, you might as well give a bit of an update on the market and where things are at, Ralph. We like where we're at. I think over the next five years, we have about 20 million pounds per year on average on our books, about where we wanna be. More in the first couple of years and declining. That's boy, that's exactly where we wanna be. We probably could put a lot more. If we just wanted to go for volume, and Grant, we could put a lot more on the books. We're looking for value long-term.

Speaker 12: So I'll just give you the broought out live than grant. mons will give a of an update on the market and where things are out. But we like where we're at. We I think over the next five years we have about £2 million per year on average on our books about where we want to be. More in the first couple of years and declining that's boy, that's exactly where we want to be. We probably could put lot, lot more if we just wanted to go for volume grant. We could put lot more on the books. We're looking for value long term and, as we said in the comments just a few minutes ago, you know there's nothing like security, supply driven market transition and signing contracts with greatek customers for a term five or 10 years of. We've been through some pretty rough CH and we don't want to be there again. So grant one only to we can just go bit an upd on the market as well So we can cover that off the morning rout. Just, I mean, cover a bit of ground that's already been covered, the when we we've been through every one of these cycles that the commercial industry has seen learn a lot of things along the way. We're looking at a demand fundamental that is very construive for all the reasons. Tim with through that demand fundamental has been leveraged by financial interest, which has been very positive. This year early this year it was leveraged by, quite frankly, the unresting ka, zakstat which than created a little more concerned about the concentration of supply, and then most recently leveraged by the, the Russian invasion. That backdrop looks really constructive to us and it tells us that there is a lot of demand that's still in front of cama co demand we don't have to chase. I characterizede the term. Market in Q4 is being 1, where we were seeing teners increase. We were seeing long term contracts go from sort of two to five year bittes out of the market to two to seven years, two to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 20- thirti and through the 20- 30. that's very constructive. And we were seeing volumes go up, not just because teners we're going up but but bigger bittes we being taken out of the market.

So I'll just give you the broought out live than grant. mons will give a of an update on the market and where things are out. But we like where we're at. We I think over the next five years we have about £2 million per year on average on our books about where we want to be. More in the first couple of years and declining that's boy, that's exactly where we want to be. We probably could put lot, lot more if we just wanted to go for volume grant. We could put lot more on the books. We're looking for value long term and, as we said in the comments just a few minutes ago, you know there's nothing like security, supply driven market transition and signing contracts with greatek customers for a term five or 10 years of. We've been through some pretty rough CH and we don't want to be there again. So grant one only to we can just go bit an upd on the market as well So we can cover that off the morning rout. Just,

Tim Gitzel: As we said in the comments just a few minutes ago, you know, there's nothing like a security supply driven market transition and signing contracts with great customers for a term, whether it's 5 or 10 years. We've been through some pretty rough patches, and we don't wanna be there again. Grant, why don't I pass it to you, and you can just give a bit of an update on the market as well so we can cover that off.

Grant Isaac: Yeah. Good morning, Ralph. Just let me cover a bit of ground that's already been covered. We've been through every one of these cycles that the commercial industry has seen and learned a lot of things along the way. We're looking at a demand fundamental that is very constructive for all the reasons Tim went through. That demand fundamental has been leveraged by financial interest, which has been very positive this year. Early this year, it was leveraged by, quite frankly, the unrest in Kazakhstan, which then created a little more concern about the concentration of supply. Then most recently leveraged by the Russian invasion. That backdrop looks really constructive to us, and it tells us that there is a lot of demand that's still in front of Cameco, demand we don't have to chase.

I mean, cover a bit of ground that's already been covered, the when we we've been through every one of these cycles that the commercial industry has seen learn a lot of things along the way. We're looking at a demand fundamental that is very construive for all the reasons. Tim with through that demand fundamental has been leveraged by financial interest, which has been very positive. This year early this year it was leveraged by, quite frankly, the unresting ka, zakstat which than created a little more concerned about the concentration of supply, and then most recently leveraged by the, the Russian invasion. That backdrop looks really constructive to us and it tells us that there is a lot of demand that's still in front of cama co demand we don't have to chase. I characterizede the term. Market in Q4 is being 1, where we were seeing teners increase. We were seeing long term contracts go from sort of two to five year bittes out of the market to two to seven years, two to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 20- thirti and through the 20- 30. that's very constructive. And we were seeing volumes go up, not just because teners we're going up but but bigger bittes we being taken out of the market.

Grant Isaac: I characterized the term market in Q4 as being one where we were seeing tenors increase. We were seeing long-term contracts go from sort of 2- to 5-year bites out of the market to 2- to 7 years, 2- to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 2030s and through the 2030s. That's very constructive. We were seeing volumes go up, not just because tenors were going up, but bigger bites were being taken out of the market. Since 24 February, we've seen actually a new move in the term market, and that is what we call Russian replacement demand. What that's done is it's really created a focus on the shorter term.

Speaker 18: Yeah, Ralph, thanks for the question. Nice to talk to you this morning. So yeah, we're ramping up. We're - we went from less than 200 people a while ago, we were at 600 on our way to 850. And it's not perfectly easy. We - I will say we have a competitive advantage in Northern Saskatchewan in that we have all of the northern people that have worked for us in the past. A great workforce represents 50% to 55% of our workforce. That will come back to us every time. So there's your advantage right off the bat. There's a few of the trades that are a little trickier to find. There's some competition here. Obviously, you see the potash business running hard, the oil and gas picking up drilling. So yes, there's competition. But we take from others and down the line. And we consider ourselves to be a pretty attractive place to work, a good employer. And so we'll be able to fill those positions. And we're not just doing it like that. We're also putting a diversity lens on it as well. We're looking to get more gender diversity, which will help us a lot in the long run. It's something we've been putting a real focus on and just underrepresented groups. So we'll get there. The people will come and we'll be okay on the labor side. The costs in the quarter are about exactly where we thought they would be. So that's going well. Ralph Profiti Okay. That's great to hear. I want to switch gears a little bit and talk about committed versus non-committed. And I hear you loud and clear on your comments about not being even close to being sold out. And I just want to maybe take a look at the shorter-term horizon, maybe 5 years. And what are you telling us between committed and open non-committed on that shorter-term horizon? Are you where you want to be in that split, save just for the next 5 years? Tim Gitzel Yeah. So I'll just give you the broad outline and then Grant, he might as well give a bit of an update on the market and where things are at, Ralph. But we like where we're at. We - I think over the next 5 years, we have about 20 million pounds per year on average on our books about where we want to be more in the first couple of years and declining. That's - boy, that's exactly where we want to be. We probably could put a lot more. If we just wanted to go for volume, Grant, we could put a lot more on the books. We're looking for value long term. And as we said in the comments just a few minutes ago, there's nothing like a security supply-driven market transition and signing contracts with great customers for a term, it's 5 or 10 years. We've been through some pretty rough patches, and we don't want to be there again. So Grant, why don't I pass it to you, and you can just give a bit of an update on the market as well, so we can cover that off. Grant Isaac Good morning, Ralph. Just let me cover a bit of ground that's already been covered. The - when we - we've been through every one of these cycles that the commercial industry has seen and learned a lot of things along the way. We're looking at a demand fundamental that is very constructive for all the reasons Tim went through. That demand fundamental has been leveraged by financial interest, which has been very positive. This year, early this year, it was leveraged by, quite frankly, the unrest in Kazakhstan, which then created a little more concern about the concentration of supply and then most recently leveraged by the Russian Invasion. That backdrop looks really constructive to us. And it tells us that there is a lot of demand that's still in front of Cameco demand, we don't have to chase. I characterize the term market in Q4 as being one where we were seeing tenors [ph] increase. We were seeing long-term contracts go from sort of 2 to 5 year bites out of the market to 2 to 7 years, 2 to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 2030s and through the 2030, that's very constructive. And we were seeing volumes go up, not just because tenors were going up, but bigger bites were being taken out of the market. But since February twenty-fourth we've seen actually a new move in the term market and that is this what we call Russian replacement demand.

Speaker 18: going well. Ralph Profiti Okay. That's great to hear. I want to switch gears a little bit and talk about committed versus non-committed. And I hear you loud and clear on your comments about not being even close to being sold out. And I just want to maybe take a look at the shorter-term horizon, maybe 5 years. And what are you telling us between committed and open non-committed on that shorter-term horizon? Are you where you want to be in that split, save just for the next 5 years? Tim Gitzel Yeah. So I'll just give you the broad outline and then Grant, he might as well give a bit of an update on the market and where things are at, Ralph. But we like where we're at. We - I think over the next 5 years, we have about 20 million pounds per year on average on our books about where we want to be more in the first couple of years and declining. That's - boy, that's exactly where we want to be. We probably could put a lot more. If we just wanted to go for volume, Grant, we could put a lot more on the books. We're looking for value long term. And as we said in the comments just a few minutes ago, there's nothing like a security supply-driven market transition and signing contracts with great customers for a term, it's 5 or 10 years. We've been through some pretty rough patches, and we don't want to be there again. So Grant, why don't I pass it to you, and you can just give a bit of an update on the market as well, so we can cover that off. Grant Isaac Good morning, Ralph. Just let me cover a bit of ground that's already been covered. The - when we - we've been through every one of these cycles that the commercial industry has seen and learned a lot of things along the way. We're looking at a demand fundamental that is very constructive for all the reasons Tim went through. That demand fundamental has been leveraged by financial interest, which has been very positive. This year, early this year, it was leveraged by, quite frankly, the unrest in Kazakhstan, which then created a little more concern about the concentration of supply and then most recently leveraged by the Russian Invasion. That backdrop looks really constructive to us. And it tells us that there is a lot of demand that's still in front of Cameco demand, we don't have to chase. I characterize the term market in Q4 as being one where we were seeing tenors [ph] increase. We were seeing long-term contracts go from sort of 2 to 5 year bites out of the market to 2 to 7 years, 2 to 10 years. That's very constructive. I said the time frames were increasing. We were seeing demand that was stretching into the 2030s and through the 2030, that's very constructive. And we were seeing volumes go up, not just because tenors were going up, but bigger bites were being taken out of the market. But since February twenty-fourth we've seen actually a new move in the term market and that is this what we call Russian replacement demand.

Speaker 19: And what that's done is it's really created the focus on the shorter term. We see customers look very closely at their supply chain vulnerability, starting with making sure their fabrication contracts are in place. Well, all that fabrication is done in the Western world for the Western custommer, So that's great. So then they turn their attention to enrichment and you can clearly see from the price discovery going on in the enrichment phase that there is some panic. We saw a $48 jump in the schoolwo price. We're seeing enrichs be able to command prices that are required to build new Western enrichment capacity. So that has been the focus right now. That's kind of taken away from the trend of looking out longer term. Here's the great new El: that Russian replacement demand really hasn't hit conversion or uranium yet, which is the feed stock required to meet that new enrichment capacity that's being called for. So we see the fundamentals, we see the characteristics of the term market and then we see this new push on what we call Russian replacement demand and that all suggests to us that we have bargaining power, that we're not in a rush to put volumes under contract, that we can be strategically patient. I said before there's no tyrny of quarter end or there's no tyrny of a year end. A great contract be to fast contract every time. So we've we've got a lot of negotiations going on, a lot of advanced negotiations that when they are excuted they will show up as committed sales in future periods. We're right where we want to be: given these fundamentals and leverage to what we think is a market that is is improving for our sources of supply. So longer after. The vis wanted rough, but I just wanted to to create that context for.

And what that's done is it's really created the focus on the shorter term. We see customers look very closely at their supply chain vulnerability, starting with making sure their fabrication contracts are in place. Well, all that fabrication is done in the Western world for the Western custommer, So that's great. So then they turn their attention to enrichment and you can clearly see from the price discovery going on in the enrichment phase that there is some panic.

Grant Isaac: We've seen customers look very closely at their supply chain vulnerabilities, starting with making sure their fabrication contracts are in place. Well, all that fabrication is done in the Western world for the Western customers, so that's great. Then they turn their attention to enrichment. You can clearly see from the price discovery going on in the enrichment phase that there is some panic. We saw a $48 jump in the SWU price. We're seeing enrichers be able to command prices that are required to build new Western enrichment capacity. So that has been the focus right now that's kind of taken away from the trend of looking out longer term. Here's the great news, Ralph. That Russian replacement demand really hasn't hit conversion or uranium yet, which is the feedstock required to meet that new enrichment capacity that's being called for.

We saw a $48 jump in the schoolwo price. We're seeing enrichs be able to command prices that are required to build new Western enrichment capacity. So that has been the focus right now. That's kind of taken away from the trend of looking out longer term. Here's the great new El: that Russian replacement demand really hasn't hit conversion or uranium yet, which is the feed stock required to meet that new enrichment capacity that's being called for. So we see the fundamentals, we see the characteristics of the term market and then we see this new push on what we call Russian replacement demand and that all suggests to us that we have bargaining power, that we're not in a rush to put volumes under contract, that we can be strategically patient. I said before there's no tyrny of quarter end or there's no tyrny of a year end. A great contract be to fast contract every time. So we've we've got a lot of negotiations going on, a lot of advanced negotiations that when they are excuted they will show up as committed sales in future periods. We're right where we want to be: given these fundamentals and leverage to what we think is a market that is is improving for our sources of supply. So longer after. The vis wanted rough, but I just wanted to to create that context for.

Grant Isaac: We see the fundamentals, we see the characteristics of the term market, and then we see this new push on what we call Russian replacement demand. That all suggests to us that we have bargaining power, that we're not in a rush to put volumes under contract, that we can be strategically patient. I said before, there's no tyranny of quarter end or there's no tyranny of year-end. A great contract beats a fast contract every time. We've got a lot of negotiations going on, a lot of advanced negotiations that when they are executed, they will show up as committed sales in future periods. We're right where we wanna be given these fundamentals and leverage to what we think is a market that is improving for our sources of supply.

Grant Isaac: Longer answer than you wanted, Ralph, but I just wanted to create that context for you.

Ralph Profiti: Yeah, that's a great commentary. Thanks, Tim. Thanks, Grant.

Speaker 15: yeah that's a great commentary, thanks to.

Tim Gitzel: Yep. Thanks, Ralph.

Speaker 20: gryes, thankase well.

Speaker 1: The next question is from Andrew Ong with RBC capital markets. Please go ahead.

Operator: The next question is from Andrew Wong with RBC Capital Markets. Please go ahead.

Andrew Wong: Hi, good morning. Can you talk about the delay in deliveries from Inkai? Is that a chemical-specific decision just made for risk mitigation purposes or, you know, are there actual hurdles for delivery? I think your partner, Kazatomprom, indicated earlier this week that there's definitely risk in the region, but the deliveries haven't been disrupted yet.

Speaker 21: Good morning. Can you talk about the delay in deliveries from incai? Is that a chemical specific decision just made for risk medication and purposes, or are there actual hurdles or delivery? I think your partner is out in. Prompt indicated earlier this week that there's definitely a risk in the region but the deliveries haven't been disrupted yet.

Tim Gitzel: Yeah. Thanks, Andrew. Obviously, we don't love the fact that we have to ship material through Russian ports. That's, I mean, that's an issue in and of itself. This is a question of risk mitigation, really. We've seen cancellations of some cargo insurance. We thought we could cover. We wanna see what alternate routes are available. I know there's work going on that, and we're talking to our partner there in that regard. We just decided to delay a shipment until we can see a little clearer picture over there.

Speaker 10: Thanks Andrew. Obviously we don't love the fact that we have to ship material through Russian port, So that's- I mean that's an issue in and of itself. So this is a question of risk mitigation. Really, we've seen that- cancellations of some cargo insurance- And so we thought we could cover. We want to see what the alternate routes are available. I know there's work going on and happ, we're talking to our partner there in that regard, So we just decided to delayership until we can see a little clearer picture over there.

Andrew Wong: Okay, great. Just my second question is more around enrichment. We saw enrichment prices drop quite a lot in April. I'm guessing it's probably the biggest drop we've ever seen in enrichment prices. What is that signaling to us about the market? And have we yet entered into a situation where the enrichers on the Western side may have to go into an overfeed situation? And if that were to be the case, like, what's the delta on uranium demand versus what we've seen in a more underfeed scenario? Thanks.

Speaker 21: Okay great. iand then just my second question is more around than enrichment. We saw in mission prices dump quite a lot in April . I'm guessing it's probably the biggest Trump we've ever seen in your Richard prices. What is that signaling to us about the market? And' are we have we yet entered into a situation where the enrichhers on the Western side may have to go into an overfeed situation? And if that were to be the case, like what's the delta on on uranium demand versus what we've seen in a more underfeed sceneracal?

Tim Gitzel: Yeah. The signal, Andrew, is that 39% of enrichment comes out of Russia, but Grant, you wanna speak to maybe enrichment and the conversion 'cause it's the same movie.

Speaker 10: knowthe signal andreers, the thir 9% of enrichment films out of Russia, but the gr you speak to maybe within the same movie. yeah we, we're talking about unprecedented geopolitical realignment and what that' code for is just the Western markets trying to exclude Russia. And just a reminder- Tim talked about it earlier- thirty 9% of global enrichment capacity is russi, 27% of global conversion capacity as Russian, 14% of uranium capacity is Russia. But but here's an interesting one that a lot of people don't make: no, half of the So called secondary supplies are also Russia, and that's a piece of the story that also needs attention to. So there's an enormous amount of supply that folks have been counting on over the years that steps are being taken to exclude. When we see these types of security of supply driven moment, it is very typical where the fuel buyers to work their way back up stream to, to start by asking questions about the in process material they have at fabricators and then turn their attention to enrichment and then after that, once their enrichment services are contracted, and make sure they got the conversion services contracted, and then their attention to uranium. So what we're seeing with since February 20 fourth, is a real focus on this replacement, and the main pinch point at the moment is in enrichment, And so you're seeing the Western enrichers being able to command the price.

Grant Isaac: Yeah. We're talking about an unprecedented geopolitical realignment. What that's code for is just the Western markets trying to exclude Russia. Just a reminder, that Tim talked about it earlier, 39% of global enrichment capacity is Russian. 27% of global conversion capacity is Russian. 14% of uranium capacity is Russian. Here's an interesting one that a lot of people don't think about. Half of the so-called secondary supplies are also Russian, and that's a piece of the story that also needs attention too. There's an enormous amount of supply that folks have been counting on over the years that steps are being taken to exclude.

Grant Isaac: When we see these types of security of supply-driven moments, it is very typical for the fuel buyers to work their way back upstream to start by asking questions about the in-process material they have at fabricators, and then turn their attention to enrichment. After that, once their enrichment services are contracted, then make sure they got the conversion services contracted, and then turn their attention to uranium. What we're seeing since 24 February 2022 is a real focus on this replacement. The main pinch point at the moment is enrichment. You're seeing the Western enrichers being able to command a price that actually is required to grow Western enrichment capacity. What that suggests is that we're probably close or at capacity limits already among Western enrichers.

Speaker 18: That actually is required to grow Western enrichment capacity. So what that suggests is that we're probably close or at capacity limits already among Western enrich. Fact that they can command prices that re that are required for new capacity to come online in the future suggests to me that those capacity limits are probably hit. What that means is that excess capacity that had been used for under feed is probably now gone and, as a result, a plant that's completely full. The only way to get more enrichment out of it is to move to what you call overfeed, and overfeed is just code for you need more feed, you need more, you need more uranium that's converted into U F six coming into the enrichment space and the great news is this Russian replacement demand. We've seen the push now in enrichment. We haven't yet seen it fully in conversion, let alone uranium. So I think it's a very, very positive signal. It's a very positive signal that contributes to why we can step back and take a bit more strategic patients in our contracting for our conversion services and importantly, our uranium, and command the terms and conditions that we want, given the fundamentals in the backdrop. So I think you're right and focusing on it and I think it is and important signal and a very positive one.

Grant Isaac: The fact that they can command prices that are required for new capacity to come online in the future suggests to me that those capacity limits are probably hit. What that means is that excess capacity that had been used for underfeed is probably now gone. As a result, a plant that's completely full, the only way to get more enrichment out of it is to move to what you call overfeed. Overfeed is just code for you need more feedstock. You need more uranium that's converted into UF6 coming into the enrichment space. The great news is this Russian replacement demand, we've seen the push now in enrichment. We haven't yet seen it fully in conversion, let alone uranium. I think it's a very, very positive signal.

Grant Isaac: It's a very positive signal that contributes to why we can step back and take a bit more strategic patience in our contracting for our conversion services and importantly, our uranium and command the terms and conditions that we want, given the fundamentals and the backdrop. I think you're right in focusing on it, and I think it is an important signal and a very positive one.

Andrew Wong: That's great. Thank you.

Speaker 21: Great Thank you, Thank soon.

Tim Gitzel: Thanks, Andrew.

Speaker 22: The next question is from Gordon and Johnson. With GL J research. Please go ahead.

Operator: The next question is from Gordon Johnson with GLJ Research. Please go ahead.

Speaker 9: heyys, thanks for taking the question. I guess the first question is: you guys use the target of 40% fixed price and 60% spot ratio and I just wanted to know if that's still kind of the reference point you guys are looking at in the new contracttor signing.

Gordon Johnson: Hey, guys. Thanks for taking the question. I guess the first question is you guys used to target a 40% fixed price and 60% spot ratio. I just wanted to know if that's still kind of the reference point you guys are looking at in the new contracts you're signing.

Speaker 23: And.

Tim Gitzel: Grant?

Grant Isaac: We've had that disclosure in the past, and we've actually kind of stepped back a little bit because we discovered it was being interpreted as every contract we sign, we wanna have a 60/40 balance, or in any one year, we wanna have a 60/40 balance. Think about it as a full cycle. Over the highs and lows of a full uranium cycle, we've discovered that we can add and sustain very significant value by having a portion that's market-related and a portion that's fixed. But in any moment in any cycle, that's not necessarily our governing parameters. Right now, where are we sitting? We're sitting in a market where the demand outlook is strengthening and is durable, and the supply outlook is uncertain.

Speaker 24: We've had that disclosure in the past and we've kind of stepped back a little bit because we discovered it was being Interpreted as every contract we sign. We want to have a 60 40 balance or in any one year. We want to have a 60 40 balance think about it as a full cycle over over the highs and lows of a full uranium cycle. We've discovered that we can add and sustained very significant value by having a portion that's market related and a portion that's fixed. But in any moment in any cycle that's not necessarily our governing parameters. So right now where we sitting we're sitting in a market where the demand outlook is. It's strengthening and is durable and the supply outlook is uncertain and that supply outlook is leveraged by.

Grant Isaac: That supply outlook is leveraged by challenges with the concentration of supply, with this geopolitical realignment, with the inability of primary production to respond quickly or the inability of greenfield to come on fast in a world where supply chains are broken and inflation is a very important factor. That all suggests to us that right now we have a very strong bias towards market-related as opposed to the 40% that's fixed. Think about that balance full cycle, but it may not be representative of where we are at any moment in the cycle. Where we're sitting right now, we have a very high preference for market-related. We see a suite of factors that suggest to us that prices are improving.

Speaker 25: Challenges with with, with the concentration of supply, with this geopolitical realignment with, with the inability of primary production to respond quickly or the inability of greenfield to come on fast in a world where supply chains are broken and inflation is a very important factor. That all suggests to us that right now we have a very strong buiys towards market related, as opposed to the 40% that's fixed. So think about that balance full cycle. But it may not be representative of where we are at any moment in the cycle. Where we're sitting right now we have a very high preference for market related. We see a suite of factors that suggests to us that that prices are improving. We don't want to lock in those prices today because we want to. We want leverage to an improving pricice environment. But overall full cycle, some point we'll see prices that are- we think we're prepare. For course some fixed pricing or base escalated and that will lock us in when the market respond. I mean we know in commodities hyper prices bring hyper supply and we want to, we'd want to be protected from that side of the cycle. So where we are in any one cycle really determines what our interest is. At the moment we're highly market related focused.

Grant Isaac: We don't wanna lock in those prices today because we want leverage to an improving price environment. Overall, full cycle, at some point, we'll see prices that we think we're prepared for some fixed pricing or base escalated, and that will lock us in it when the market responds. I mean, we know in commodities, hyper prices bring hyper supply, and we'd wanna be protected from that side of the cycle. Where we are in any one cycle really determines what our interest is. At the moment, we're highly market-related focused.

Gordon Johnson: Hey, that's helpful. One last one for me. You know, when I think about what we're looking at in this market, I mean, we've seen record spikes in U3O8 prices. We've seen, you know, Biden launch this $6 billion civil nuclear program. Gavin Newsom, yep, Gavin Newsom saying, you know, he's gonna reconsider the closure of Diablo Canyon. There's just been a lot of positive data points out there. Have you guys ever calculated if you were more spot versus fixed contract, what the impact or maybe the sensitivity to your cash flows and earnings would be? Thanks for the questions, guys.

Speaker 9: hethat's that's helpful? Well, not for me. You know when I think about what we're looking at in this market. I mean we've seeing record spikes in utriated prices. We've seen Biden launched the $6 billion civil nuclear program, Gavin nursomsome.

Speaker 26: Yes gavvennew, some saying going to reconsider the closure of the olo Canyon. There's just been a lot of positive data points out there. Have you guys ever calculated if you were more spot versus fixed contract, what the impact or maybe the sensitivity for your cash flows and earnings? Thanks for the question, gu.

Greg Barnes: Thanks, Gordon.

Grant Isaac: Thanks, Gordon.

Speaker 10: The So a big difference between what we would think of a sort of spot exposure and term exposure that the reality for the uranum market, whether global demands a hundred £8 million a year or £3 million a year, the spot market will still not be the fundamental market. It will be a discretionary market used by fuel buyers for things like reloads or or inventory adjustments, but it won't be where they cover their run rate requirements, which means the spot market will never be capable of absorbing the kind of volumes that we produce. And and when, when camico, or because Adam from or a big producer shows up with primary production in the spot market, that's the d. the spot market starts to go down and we don't. We don't have to look any further than two weeks ago to see a $10 drop in the spot price to see actually how theninly tradated it is. You don't want a primary producer targeting the spot market. What you want is a primary producer who builds homes for their production plans, their production according to those homes, but then has the right combination of market related and base escalated turns to drive multi year value. So not capturing short likeke of the spot market but locking that spot market price pressure into multiyear contracts that capture that value and create those cash flows and earnings for sustained period of time. So, on balance, we want enough market related exposure to capture the upside and we want value to be locked to protect from the downside for when, those moments where undisciplined supply is hitting the spot market. So very, very different way of thinking about it. Then, spot exposure being the spot market, I mean you want market related exposure, but not through the spot market. You want it through term contracts that are market related.

Grant Isaac: A big difference between what we would think of as sort of spot exposure and term exposure. The reality for the uranium market, whether global demand's 180 million pounds a year or 300 million pounds a year, the spot market will still not be the fundamental market. It will be a discretionary market used by fuel buyers for things like reloads or inventory adjustments. It won't be where they cover their run rate requirements, which means the spot market will never be capable of absorbing the kind of volumes that we produce. When Cameco or Kazatomprom or a big producer shows up with primary production in the spot market, that's the day the spot market starts to go down.

Grant Isaac: We don't have to look any further than two weeks ago to see a $10 drop in the spot price to see actually how thinly traded it is. You don't want a primary producer targeting the spot market. What you want is a primary producer who builds homes for their production, plans their production according to those homes, but then has the right combination of market-related and base-escalated terms to drive multiyear value. Not capturing the short-term spike of a spot market, but locking that spot market price pressure into multiyear contracts that capture that value and create those cash flows and earnings for a sustained period of time.

Grant Isaac: On balance, we want enough market-related exposure to capture the upside, and we want value to be locked in to protect from the downside for when those moments where undisciplined supply is hitting the spot market. Very, very different way of thinking about it than spot exposure being the spot market. I mean, you want market-related exposure, but not through the spot market. You want it through term contracts that are market related.

Speaker 1: Thanks again for the questions. Thanks, Gordon.

Gordon Johnson: Thanks again for the question.

Greg Barnes: Thanks, Gordon.

Grant Isaac: Thanks, Gordon.

Speaker 22: The next question is from orrest waladout with Scotia bank. Please go ahead.

Operator: The next question is from Orest Wowkodaw with Scotiabank. Please go ahead.

Speaker 27: Hi good morning, grant. Just wanted to clarify something you said earlier with respect to the state of your negotiations, I guess, for new contracts. I think we're all a bit surprised that company didn't add any more to the £4 million that were announced, I guess mid February . And it sounds like your comments are more related to the fact that utilities are focusing on the enrichment side, first with respect to the recent developments on the geopolitical risk front. But I'm just wondering, is part of the issue also? I mean, given your strengthened bargaining power, is it also an issue where you know the that as spread is changed, in the sense of your're now in a much stronger position So you can be commanding much higher pricing than you could have a few months ago?

Orest Wowkodaw: Hi, good morning. Grant, just wanted to clarify something you said earlier, with respect to the state of your negotiations, I guess, for new contracts. I think we're all a bit surprised that the company didn't add any more to the 40 million pounds that were announced, I guess in mid-February. It sounds like your comments are more related to the fact that utilities are focusing on the enrichment side, first with respect to the recent developments on the geopolitical risk front. I'm just wondering, is part of the issue also? I mean, given your strengthened bargaining power, is it also an issue where, you know, the bid-ask spread has changed in the sense of you're now in a much stronger position, so you can be commanding much higher pricing than you could have a few months ago?

Speaker 11: Your characterization is absolutely spot on, or so it's a combination of the Russian replacement demand as a result of the February 20 fourth invasion has really taken attention to the enrichment space away from uranium and conversion at the moment. So So that's. That's actually slowed down probably some of the origin ation that we would have seen on on uranium and conversion, but the stuff that was already under negotiation yes, we do feel like we can be strategically patent that, that we have the asset mix, that we have the services with our conversion facility- the only one operating in North america- that that now is the time to be strategically patient within negotiations to capture that maximum value for our owner. So it's, it is exactly the combination of those two things, which is exactly what you want us to be doing, because the goal is to capture full cycle maximum value, not just volume.

Grant Isaac: Your characterization is absolutely spot on, Orest. It's a combination of the Russian replacement demand as a result of the 24 February 2022 invasion has really taken attention to the enrichment space away from uranium and conversion at the moment. That's actually slowed down probably some of the origination that we would have seen on uranium and conversion. The stuff that was already under negotiation, yes, we do feel like we can be strategically patient, that we have the asset mix, that we have the services with our conversion facility, the only one operating in North America, that now is the time to be strategically patient within negotiations to capture that maximum value for our owners.

Grant Isaac: It is exactly the combination of those two things, which is exactly what you want us to be doing because the goal is to capture full cycle maximum value, not just volume.

Speaker 28: yeah totally agreed. I think we've got a pretty good picture on your call it uranium capacity, but can you maybe give us some insight on the conversion side specifically, like I don't really have a good sense of you know how much additional volume you still have to sell there over the the medium term.

Orest Wowkodaw: Yeah, totally agreed. I think we've got a pretty good picture on your, call it uranium, capacity. But can you maybe give us some insight on the conversion side, specifically? Like, I don't really have a good sense of, you know, how much additional volume you still have to sell there over the medium term.

Speaker 9: yeah well, I can tell you conversion is about as hot as we've seen it ever. I don't think we've ever seen it. You know it's started a couple of years ago and a lot of the supply was taken off. And then this conversions of events over a couple years, all of a sudden conversion, you know, in from $5, a CA six to to 20 and it's in the twenty's today. Now you take off 20, Seven percent from Russia and it's really, it's really tight. So I can- just what I can say about our plant in the port: hope. We're running it pretty hard. We're looking at whether we can increase capacity over time. Of course we wondon't do that just on spec. We would have to have some good reason to do that. We don't have that at the momentto. We know a lot of countries and companies are scrambling four conversion to lock up conversion going forward. So our book looks really good, I would say, for the next number of years and we're looking to see, you know, if we can just squeeze a little bit more the juice of the orange there.

Tim Gitzel: Yeah. Well, I can tell you conversion is about as hot as we've seen it ever. I don't think we've ever seen it, you know. It started a couple of years ago when a lot of the supply was taken off. This convergence of events over a couple of years, all of a sudden conversion, you know, went from $5 a kgU UF6 to 20, and it's in the 20s today. Now you take off the 27% from Russia, and it's really tight. What I can say about our plant in Port Hope is we're running it pretty hard. We're looking at whether we can increase capacity over time. Of course, we won't do that just on spec.

Tim Gitzel: We would have to have some good reason to do that. We don't have that at the moment. We know a lot of countries and companies are scrambling for conversion to lock up conversion going forward. Our book looks really good, I would say, for the next number of years. We're looking to see, you know, if we can just squeeze a little bit more the juice out of the orange there.

Speaker 9: Can you give us a bit more color though, like: are you effectively locked in or sold out for the next couple of years, or do you still have the capacity to add conversion?

Orest Wowkodaw: Can you give us a bit more color, though? Like, are you effectively locked in or sold out for the next couple of years, or do you still have the capacity to add conversion, with higher pricing in the near term? I'm just wondering if we should think about sort of this opportunity more medium to long term or whether there's actually upside short term.

Speaker 21: With higher pricing in the near term. I'm just wondering if we should think about sort of this opportunity, more obedient to long term, or whether there's actually upside short term.

Tim Gitzel: Yeah, I'd say we're pretty heavily committed for the next number of years, for sure. We've got, you know, things. It's like our uranium portfolio, where we're heavily committed in the next few years and things start to open up. We're talking conversion with lots of customers, but out a few years.

Speaker 10: Yes ID think we're pretty heavily committed for the next number of years. For sure, we've got things- it's like our kind of like our uranum portfolio- where we're heavily committed in the next few years and things start to open up. So we're talking conversion with lots of the customers, but out a few years.

Orest Wowkodaw: Okay. Thank you.

Speaker 9: okthan, K you Goodbye.

Tim Gitzel: Yeah. Thanks.

Speaker 1: The next question is from lawst and winter with Bank of America Securities. Please go ahead.

Operator: The next question is from Lawson Winder with Bank of America Securities. Please go ahead.

Speaker 9: Hi good morning. I to hear from you all and thank you for the. I also like that ask about conversion and get a sense for the discussion you're having right now. So obviously that I mean the price indicator. There is junk quite a bit and my understanding is that utility 'are willing to pay in the $27 per pound plus range. Is that what you're seeing and then give an idea of?

Lawson Winder: Hi. Good morning. Nice to hear from you all, and thank you for the. I'd also like to ask about conversion and just get a sense for the discussions you're having right now. Obviously, I mean, the price indicator there has jumped quite a bit. My understanding is that, you know, utilities are willing to pay in the $27 per pound plus range. Is that what you're seeing? And then, can you give us an idea of what your current capacity utilization is on the conversion? And then what would it take in terms of both cost and time to get to a 100% utilization? Thank you.

Speaker 8: What your current capacity utilization is on the conversion and then would it take in terms of both cost and time to get to 100% utilization?

Speaker 29: Thank you.

Tim Gitzel: I'll just say what our licensed capacity is, and that's about 12,500 tons at the plant. As I say, we're pushing it as hard as we can. Expanding that's a whole different movie. We would have to really think hard about that and how to do that. We just wanna try and get as close as we can to the capacity that we have, and then we'll see after that. Grant, do you wanna talk about the contracting and conversion and just give as much detail as you can on that?

Speaker 7: 'll just say what our license capacity is, and that's about 12.5 thousand ton at the plant. As I say, we're pushing it as hard as we can. Expanding that that's a whole different movie we would. We would have to really think hard about that than and how to do that. So we just want to try and get as close as we can through the, the capacity that we have, and then we'll see after that. But grant, you want to talk about the contracting in conversion and just give as much detail as you can on the, the pressure that we're seeing build enrichment's only a matter of time before you see it to flow through more visibly into conversion, because that's what's required in order to feed that enrichment capacity. Let's just think about it in broad global terms. Tim reference: you know: 27% the global conversion capacity as Russian.

Grant Isaac: Yeah. The pressure that we're seeing build in enrichment is only a matter of time before you see it flow through more visibly into conversion because that's what's required in order to feed that enrichment capacity. Let's just think about it in broad global terms. Tim referenced you know 27% of the global conversion capacity is Russian. That basically means the Western world is missing conversion capacity the size of another Port Hope. 12,500 tons of conversion capacity. That's a pretty big hole to fill. Along the way, we're gonna see a plant come back in the US, the ConverDyn plant. Obviously a new plant in France, Orano's Tricastin plant going from 7,500 tons to maybe 15,000 tons of conversion.

Speaker 18: That basically means the world in the Western world is missing conversion capacity the size of another for hope.

Speaker 25: 12.5 thousand tons of conversion capacity. That's a pretty big Ho to fill. Along the way we're going to see a plant come back in the U's, the contrad ine plant, obviously a new plant in France, ano's Philip co plant, going from 7500 tons to may 15 thousand tons of conversion. So Western capacity will respond. But the key to making it respond is the power of utility procurement. I mean that that's what's going to create the conditions to make the decisions to PL for higher levels of conversion. Utility start to contract. So where are we seeing it? Well, we're seeing those who have been very dependent on Russian EU P. So that's material that shows up, that's already enriched, already converted. We're seeing those first come to the market and that's kind of near term demand filling up that book like Tim talked about. You're seeing conversion pricing in the mid 20, even in even term pricing. That really is reflecting the fact that additional capacity has to come online. But but here's the good news- we haven't yet seen the replacement rate type of demand in the conversion, let on the uranium space. That that's still for us. So conversion is the next pitch point after enrichment. We saw the pressure build an enrichment very visibly with the's price going up. We do expect more strengthening in the conversion market as a result.

Grant Isaac: Western capacity will respond, but the key to making it respond is the power of utility procurement. I mean, that's what's going to create the conditions to make the decisions to plan for higher levels of conversion. Utilities start to contract. Where are we seeing it? Well, we're seeing those who have been very dependent on Russian EUP, so that's material that shows up that's already enriched, already converted. We're seeing those first come to the market, and that's kinda near-term demand filling up that book like Tim talked about. You're seeing conversion pricing in the mid-20s, even term pricing, that really is reflecting the fact that additional capacity has to come online. Here's the good news.

Grant Isaac: We haven't yet seen the replacement rate type of demand in the conversion, let alone the uranium space. That's still before us. Conversion is the next pitch point after enrichment. We saw the pressure build in enrichment very visibly with the SWU price going up. We do expect more strengthening in the conversion market as a result.

Speaker 1: Thanks both. Also the current collective bargaining agreement with the unionized employee that pork hope at the conversion facility that expires this year. Is there any risk to your production that we should be maybe thinking about there? Any comments you're able to make on that at this point?

Lawson Winder: Thanks both. Also the current collective bargaining agreement with the unionized employees at Port Hope at the conversion facility that expires this year, is there any risk to your production that we should be maybe thinking about there? Any comments you're able to make on that at this point?

Tim Gitzel: I'd never say there's no risk, but we certainly have a good relationship with our employees, and hopefully both sides will be able to sit down and iron something out, and give us some clarity for the next couple of years. We'll see.

Speaker 10: buti never say there's no risk. But we certainly have a good relationship with our employees and hopefully we'll- both sides- be able to sit down and iron something out and give us some clarity for the next couple of years. So we'll see.

Lawson Winder: Sure. Thanks for the comment.

Speaker 11: Sure thanks for the comment now. Thanks for law lawson.

Tim Gitzel: Yeah. Thanks a lot, Lawson.

Speaker 1: That.

Operator: The next question is from Greg Barnes with TD Securities. Please go ahead.

Speaker 30: Next question is from Greg Barnes with Tv Securities, Please go ahead.

Greg Barnes: Yeah, thank you, operator. Grant and Tim, are you seeing your customer base broaden out as this global realignment occurs? It may be early days yet, but are you beginning to talk to people that you might not have talked to in the past?

Speaker 31: Yes Thank you, operator grant and Tim. Are you seeing your customer-bed broaden out of this? Global realignment occurs in maybe early days yet, but you are beginning to talk to people that you might not talk to people in the past.

Grant Isaac: Certainly we are, Greg. It's actually quite exciting because it looks like, as the lines are being redrawn, that Eastern European market is actually breaking west. That Eastern European market, as a perfect example, has been a captive market of Russia since the beginning. Those are Russian reactors. Typically, the Russians would just provide fabricated fuel bundles to those utilities. Over the last couple of years, predating the Russian invasion of Ukraine, we began to make inroads into some of those important Eastern European markets from Ukraine all the way down to Slovenia, and everybody in between. Of course, this invasion has just accelerated it. Now we're in full-blown conversations with customers there who are looking for all the components.

Speaker 11: Certainly we are. It's actually quite exciting because it it looks like, as the lines are being reddrawn, that Eastern year end market is actually breaking West and that Eastern European market, as a example, has been a captive market of Russia since the beginning. Those are Russian reactors and typically the Russians, which just provide fabricated fuel bundles to those utility. Over the last couple of years predating the Russian invasion of Ukraine, we began to make in roads into some of those important Eastern European markets from Ukraine all all the way down to slavenia and everybody in between, and then, of course, this invasion has just accelerated it. And now we're in full blown conversations with with customers there who we're looking for, all the components they're looking to to pivot to Western and suppliers that are secure and reliable and really break that, that control that the Russian fuel cycle had over their very important electricity infrastructure. So that's a absolute broadening of the base of our customer. And then it's a deepening has, as you look at our, our markets where we already have good market penetration. We just expect our market share to go up in those markets as as they struggle with, with origins and look to exclude Russia. So we're not only going to grow our market share and existing markets, we're going to broaden that customer base, customer base into markets that have historically been been captive- yet another reason why we're pretty constructive on this right now.

Grant Isaac: They're looking to pivot to Western suppliers that are secure, reliable, and really break that control that the Russian fuel cycle had over their very important electricity infrastructure. That's an absolute broadening of our customer base. It's a deepening. As you look at our markets where we already have good market penetration, we just expect our market share to go up in those markets as they struggle with origins and look to exclude Russia. We're not only gonna grow our market share in existing markets, we're gonna broaden that customer base into markets that have historically been captive. Yet another reason why we're pretty constructive on this right now.

Greg Barnes: Just a follow-up question, Grant. Just a little curious on the Orano loan extension, given you are restarting McArthur, I'm surprised that needed to be extended.

Speaker 9: Just a follow-up question. Grant, just to look curious, from the irano loan extension. Given you are restarting M Cara, I'm surprised that needed to be extended.

Speaker 9: Yes well remember, we're still technically in supply discipline. We are bring macarthur back, but we're not planning on running it that capacity. And at the same time, in 2024 we're planning with our joint venture partner to bring Cigar Lake down to a 13 and a half million pounds. That our's our stated goal at the moment. We haven't seen.

Grant Isaac: Yeah. Well, remember, we're still technically in supply discipline. We are bringing McArthur River back, but we're not planning on running it at capacity. At the same time, in 2024, we're planning with our joint venture partner to bring Cigar Lake down to 13.5 million pounds. That's our stated goal at the moment. We haven't seen. We've seen some good contracting, but we haven't seen that kind of replacement rate contracting, that volume of procurement that would call for a different decision at the moment. As we structured what that appropriate production is, you know, our interests combined with their interests, we just said, "Look, we don't need the inflow of material in that window. We're still in supply discipline mode." They weren't eager to pay it back in that window.

Speaker 18: We've seen some good contracting, but we haven't seen that kind of replacement rate contracting, that power of procurement that would call for a different decision at the moment. And so as we, as we structured what what that appropriate production is- you know our interests combined with their interest- we just said look, we don't need the inflow of material in that window, we're still in supply discipline mode. They weren't eager to pay it back in that window there in supply disciplinine mode, not just in Northern's stat But but also in Kazakhstan and also in the J as they all talk about. So just mutually, it made sense for both of us to not worry about it until later out in the cycle course. Added to that is the fact that through 2021 and into early 2022 we layered in another £7 million of contracts- ilt, the vo- out into the longer term. We have more appropriate homes for those inflows probably out in the future than we do at a moment. So it just made sense for both about. So shouldn't come as a surprise, just kind of the normal tuning and frowing within a joint venture relationship.

Grant Isaac: They're still in supply discipline mode, not just in Northern Saskatchewan, but also in Kazakhstan and also in Niger, as they'll talk about. Just mutually, it made sense for both of us to not worry about it until later out in the cycle. Of course, added to that is the fact that through 2021 and into early 2022, we layered in another 70 million pounds of contracts, built the book out into the longer term. We have more appropriate homes for those inflows probably out in the future than we do at the moment. It just made sense for both of us. Shouldn't come as a surprise, just kind of the normal to-ing and fro-ing within a joint venture relationship.

Greg Barnes: Okay. Thanks, Grant.

Speaker 31: Okay myice grfriend.

Speaker 7: Thanks gree.

Tim Gitzel: Thanks, Greg.

Speaker 1: The next question is from Paul riside with a private Investor. Please go ahead.

Operator: The next question is from Paul Rosenstein, with a private investor. Please go ahead.

Paul Rosenstein: Hi, Tim. Hi, Grant. Happy Cinco de Mayo.

Speaker 32: Hi Tim, I grant a happy uh thankanco tomilethat's right.

Tim Gitzel: Oh, that's right.

Paul Rosenstein: Yeah, some people are calling it Cameco de Mayo. I'm very happy to hear this conference call today.

Speaker 33: yeah some people are calling it C ic, go to mile. I'm very happy to hear this uh conference call today. Just can Thank for taking me. We're just getting some servations sentinvolved.

Tim Gitzel: Just getting some-

Paul Rosenstein: Thanks for taking my question.

Tim Gitzel: We're just getting some cervezas sent in, Paul, so.

Paul Rosenstein: Yeah. What I'd like to ask you about is Global Laser Enrichment, if you could go into some detail about that and about whether that's being ramped up to, you know, increase production for all this new demand that's going on.

Speaker 34: I what I'd like to ask you about is global rich laser enrichment, if uh.

Speaker 11: You can go into some detail about that and about.

Speaker 35: Whether that's being uh wrapped up to.

Speaker 36: Increased production for all this new demand that's going on.

Tim Gitzel: Yeah, that's a great question, Paul. It's something I'm gonna pass it over to Sean in a minute just to give an update on where we're at, but it's super exciting for us. It's something that we see now as kind of a triple threat for us. With the, you know, discussion we're having this morning where you take 40% of the world's enrichment, kind of, and tuck it away and say it's not available to the Western markets, all of a sudden everybody's looking for enrichment. So, as we said in our comments, people are looking for just pure SWUs for LEU. They're also looking for HALEU, the high-assay low-enriched uranium that's gonna feed the SMRs going forward.

Speaker 10: yeah that's a great question Paul, and it's it's something mean to pass Sean and min to give anupate on we, but it's super exciting for us. It's something that we see now as it's kind of a triple threat for us with the discussion we're having this morning where you, you take 40% of the world's enrichment, kind of a tuck it away and say it's not available to the Western markets. Well, it's said everybody's looking for for enrichment and, And so, as we said in our comments, people are looking for just pure's for L you. They're also looking for how you the high, low enrich uranium that's going to fe the as M R's going forward. Everybody thought the Russians, we were going to supply that for the first, for the first 10 years or so, until somebody could build to how you plants and all that's on the front, front burner. And then of course, just those tailes, the de E tailes we see as a potential new mind in states. You reenrich those tail, not only you get the uranium component but you got dormment conversion, if feel like sitting in there, And so when you reenrich you get you of six and so, which is hoted demand today. So it's we're really why our excitement levels going up a few ves not let turn to Sean, just even an update this to where we're, we've stood up, the company, and just some of the progress we've made in the last months. Sure, I will add what you, that the underpaying remain the tailes position agreement that we have with the de E. but we are actively considering, will be considering, whether there is a plan to accel a development to take advantage of the opening we see in the market, particular enrichment and conversion, and whether there is some way to get some citance on that in the various initiative that being undertaken by the government, mostly that by the de we, to see we can advance deployment and perhaps to change the focus of the. The first facility that we're considering to do would provide more commercial food, how you, and have the conversion opportunity even more. The want to come on that two months.

Tim Gitzel: Everybody thought the Russians were going to supply that for the first 10 years or so until somebody could build a HALEU plant. Now that's on the front burner. Then, of course, just those tails, the DOE tails, we see as a potential new mine in the United States. You re-enrich those tails, not only do you get the uranium component, but you've got dormant conversion, if you like, sitting in there. When you re-enrich, you get UF6, which is in high demand today. We're really, boy, our excitement level's gone up a few octaves on that one.

Tim Gitzel: Let me turn it to Sean just to give you an update as to where we're at, and we've stood up the company and just some of the progress we've made in the last months.

Brian Reilly: Sure. Thanks, Tim. I will add to what you said that the underpinning of GLE remains the tail disposition agreement that we have with the DOE. We will be considering whether there is a plan to accelerate development to take advantage of the openings we see in the market, particularly for enrichment and conversion. Whether there's some way to get some assistance from that in the various initiatives that are being undertaken by the US government, mostly led by the DOE, to see if we can advance deployment and perhaps change the focus of the first facility that we're considering at Paducah so that it would provide more commercial SWU, HALEU, and tap the conversion opportunity even more.

Sean Quinn: Sure. Thanks, Tim. I will add to what you said that the underpinning of GLE remains the tail disposition agreement that we have with the DOE. We will be considering whether there is a plan to accelerate development to take advantage of the openings we see in the market, particularly for enrichment and conversion. Whether there's some way to get some assistance from that in the various initiatives that are being undertaken by the US government, mostly led by the DOE, to see if we can advance deployment and perhaps change the focus of the first facility that we're considering at Paducah so that it would provide more commercial SWU, HALEU, and tap the conversion opportunity even more.

Tim Gitzel: Mm-hmm.

Brian Reilly: More to come on that over the next few months.

Sean Quinn: More to come on that over the next few months.

Speaker 37: Okay great, I I. I was wondering uh.

Paul Rosenstein: Okay, great. I was just wondering, I understand that you guys have an option to increase your share, I think, to 70% or 75% from the current 49%. Is that something that you're considering?

Speaker 38: I understand that you guys have an option to increase your share, I think, to 70 years 70, five percent from the current 49%. Is that something that you're considering?

Tim Gitzel: We do, and we are. Yes, absolutely.

Speaker 10: We do and we are yes, absolutely.

Tim Gitzel: We do, and we are. Yes, absolutely.

Speaker 9: Great Thank you yes, Thank you all.

Paul Rosenstein: Great. Thank you.

Tim Gitzel: Yep. Thank you, Paul.

Speaker 1: Next question is from Brian macarthur with raymonand James. Please go ahead.

Operator: Next question is from Brian MacArthur with Raymond James. Please go ahead.

Brian MacArthur: Good morning. The first question, just going back to conversion in a little more detail. If you were to expand Port Hope, do you actually have to expand Blind River as well? The second question just related to conversion, just the 12,500 capacity when you have UO2 there, and at one time you could flip things back and forth. Are you just sold out on UO2 as well, or is there any capability to flex that at all?

Speaker 39: Good morning. First question just going back to conversion in a little more detail: if you were to expand court hope, do you actually have to expand blind River as well? And the second question just related on conversion, just the 12.5 thousand capacity. When you have U o two there at one time, you could flip things back and forth and you just sold out on U o two as well. Or is there any capability to flex that at all?

Speaker 1: Well let me back up a little bit. So expanding from the 12 five we'd like to get the 12 five first we haven't run at that level as you know it's just. We've been running house speed for year decades and so now Brian we're ramping it up and then trying to get up asesides. We can to expand it further into the future. That's a that's a big question mark. That's that's a plant that would need a lot of work. And if we did we we would have to increase at blind River at the refinery as well. We'd have to move up our production there as well. So.

Tim Gitzel: Well, let me back up a little bit. Expanding from the 12.5, we'd like to get to 12.5 first. We haven't run at that level. As you know, it's just we've been running half speed for years, decades.

Brian MacArthur: Yeah.

Tim Gitzel: Now, Brian, we're ramping it up and trying to get it up as high as we can. To expand it further into the future, that's a big question mark. That's a plant that would need a lot of work. If we did, we would have to increase at Blind River at the refinery as well. We'd have to move up our production there as well. On the UO2 side, I think we're good. We're supplying the contracts that we've got. We've got some great relationships with the CANDU owners to supply them fuel for a long time to come. Yeah, I don't know. This is all pretty new for us and, you know, to even talk about expanding production at Port Hope, it's new.

Brian MacArthur: Yeah.

Speaker 40: On the two side I think we're good pplaying the contracts that we've got to've got some great relationships with the cananddo owners to supply them fuel for a long time to come. So.

Speaker 40: yeah I don't know it's. This is all pretty new for us and you know, to even talk about expending production, that portable it's. We didn't even talk about that 65 days ago and now it's So on the readadar screen. So just looking at the byan Riley and who's looking after it. You know, right now it's, our goal is to get production up to to capacity, as as we can. So Brian haveity comments: So yeah well, it's the plant. U's six plant is running well. That's the good news. But it's an old plant that we have a number of capital projects underway to to keep running at the current rates and looking at the opportunity for expansion. But, as Tim stated clearly, you know, 12.5 thousand times. We've not achieved that rate before and that would be a significant milestone to do so. But the plant is running well and we want to keep it running well and we'll look at opportunities and achieving 12.5 thousand tons.

Tim Gitzel: We didn't even talk about that, 65 days ago, and now it's on the radar screen. I'm just looking at Brian Reilly, and who's looking after it. You know, right now, it's our goal is to get production up to capacity as high as we can. Brian, do you have any comments on that?

Brian Reilly: Yeah, look, it's the UF6 plant. It's running well. That's the good news. It's an old plant, so we have a number of capital projects underway to keep running at current rates and looking at the opportunity for expansion. As Tim stated clearly, you know, 12,500 tons, we've not achieved that rate before, and that would be a significant milestone to do so. The plant is running well, and we want to keep it running well, and we'll look at opportunities in achieving 12,500 tons.

Speaker 41: So can I just ask, is I know your report combined but you sort of shown 4000 KG the quarterthat's at a higher rate. I guess you're just heavily weighted on certain quarters, on U o, two or whatever, which is why that doesn't look like you're running at 12, five is that? Is that right to? I mean to look at some quarters. If you do report production, that's a higher run rate than.

Brian MacArthur: Can I just ask, and I know you report combined, but you're sort of shown 4,000 kgU a quarter, that's at a higher rate. I guess you're just heavily weighted on certain quarters on UO2 or whatever, which is why that doesn't look like you're running at 12.5. Is that right? Because, I mean, if you look at some quarters, you do report production that's a higher run rate than that, I would say, even if you put them together. Or is that not right?

Speaker 42: Than that. I would say: if you put them together, or is that not right?

Brian Reilly: Yeah. You're right. It's a combined number. I can say we're right on budget. In fact, in UF6 production, a little bit over budget at the moment. The disclosed production, it is a combined number right across the field services division.

Speaker 43: yeah you're right, it's a combined number. But I can say we're right on right on budget and in fact you have six production a little bit over budget at the moment, but the disclosed production it is a combined number right across the fuel services division and in Brian - sorry, it's grant. I'll just jump in here- that 12.5 thousand tons of license capacity, that K referends is the conversion plant only. It's not conversion plus U o two So that might be white where the confusion is coming from.

Grant Isaac: Brian, sorry, it's Grant. I'll just jump in here. The 12,500 tons of licensed capacity that Tim referenced is the conversion plant only. It's not conversion plus UO2. That might be why where the confusion is coming from.

Speaker 28: Right okay, I think it's just that you said it's consolidated because you put them together, your sort of 15, whatever you're running, little ER than that. I'm just kinding. If you viously run you two put, you have six plant pretty hard right now, which makes sense.

Brian MacArthur: Right. Okay. I think it's just that you said it's consolidated, 'cause if you put them together, you're sort of 15 whatever, and you're running a little higher than that. I'm just trying to figure out. You are obviously running the UF6 plant pretty hard right now, which makes sense.

Grant Isaac: Yeah. Yep.

Brian MacArthur: The second question, back to Greg, just on that Orano thing, you talk about, I think if I remember, the original deal was 5.4 million pounds, and now you can do an additional 1.2 of U3O8. But you sort of say there's 4.6 on it right now. Should I just add the 5.4 plus the 1.2 is 6.6 minus 4.6, so they have capacity to draw 2 more? Is that kind of the way it works at the moment?

Speaker 44: The second question, back to gregs. Just on that rano thing you talk about, I think, if I remember the original £5.4 million and now you can do an additional one point two U three 8, but you sort of say there's four point six on it right now, but I just that the five point four put the one zero 2, six point six monthes 4.6, So they have to pass me to draw two more. Is that kind of the way it works at the moment? yeah, that is kind of the way it works at the moment with this other was the other characterization Brian , that that they're looking for U's 6, So they're looking for that version component. So So let's call that what, what it is. That's another pretty important signal because, let's face it, our partner is one of the major conversion suppliers in the world looking for conversion in other places. So that's a pretty strong signal about, about the Page point in the conversion market.

Grant Isaac: Yeah, that is kind of the way it works at the moment. With the other characterization, Brian, that they're looking for UF6. So they're looking for that-

Brian MacArthur: Right

Grant Isaac: ... conversion component. Let's call that what it is. That's another pretty important signal, 'cause let's face it, our partner is one of the major conversion suppliers in the world, looking for conversion in other places. That's a pretty strong signal about the pinch point in the conversion market.

Brian MacArthur: Right

Brian MacArthur: Which is gonna be sort of my next question, then I'll get off. Could you sort of draw on the 300 of the 1.2? How did you come up with the numbers? Are they based on your book? I mean, they probably want it more, I would guess. How'd you actually determine that?

Speaker 45: Which just going to be sorry. My next question, and I'll going to Ho: could you sort of drawn 300 of the one point two where? How did you come up with the numbers of the based on your book? I mean, they probably want it more. I would get on action, determine that. yeah, you know how these negotiations go. They probably wanted more and we wanted to give the and this was, you know that, the sort of the Middle ground that was a mutual interest to both us in terms of product flow and timing and when we needed it and when they needed it. So, like like any negotiation, that I probably exactly in the Middle where they weren't happy and weweren't happy. But bably, the perfect negotiation. That's probably came crgreat. Thanks, all'll off. That's very much forgr I say by questions. Thanks for.

Grant Isaac: Yeah. You know how these negotiations go. They probably wanted more, and we wanted to give them less. This was the sort of middle ground that was of mutual interest to both of us in terms of product flow, timing, when we needed it, and when they needed it. Like any negotiation, it landed probably exactly in the middle where they weren't happy and we weren't happy. It was probably the perfect negotiation.

Brian MacArthur: That's probably right. Okay, great. Thanks. I'll get off. Thank you very much for answering my question.

Tim Gitzel: Yeah. Thanks, Brian.

Speaker 1: The next question is from Patrick jjectie, a private Investor. Please go ahead.

Operator: The next question is from Patrick Sajecki, a private investor. Please go ahead.

Speaker 9: Good morning guys. So you guys seem to have the the business under control with the cash balance now.

Patrick Sajecki: Good morning, guys. You guys seem to have the business under control. With the cash balance now ballooning, and perhaps with some inspiration from the oil and gas sector, are there any discussions beyond raising the dividend to manage the share price more directly, such as buybacks? Then my second unrelated question is, on the Tax Court of Canada website, your docket says, "Ready to be scheduled," presumably for a hearing. I'm just wondering if there's any timeline for that.

Speaker 46: ballooning and crops of some inspiration from the oil and house sector. Are there any discussions, beyond raising the dividend, to manage the share price more directly, such as buybacks?

Speaker 47: And then my uh. Second unrelated question is: uh, on the Canada tax port website your, your docket says ready to be scheduled, because you as lief for a hearing. So I'm just wondering if's any time, lans that?

Tim Gitzel: Patrick, thanks for the question. I would say hopefully we've had things under control at all times here. I'm gonna turn it to Grant to talk about capital allocation, just our principles around capital allocation. I'll say a word about the CRA and pass it to Sean for an update on that.

Speaker 10: So other thingss, the course, and I would say we, hopefully we ve things under control at all times. Here I'm going to turn to ground to talk about location, just our principles around location'll see a word about the sy a to se for an update on that. So, terms of capital allocation: we are still in the mode of matching risk with reward. You know, ours is a market where you're hearing us, I think, talk very optimistically about the demand that's ahead of us, but but keep in mind, still ahead us there're still a lot of value we need to capture through our contracting. We haven't done as much as we want to yet. That's why we're still technically in a supply discipline mode. aswe're in a supply discipline mode, we we're technically over contracted, we have more commitments. Then we have production coming in the door, which means we're going to make some purchases along the way or access some of the long term purchas that we've done. All of that suggest to me that we're still in that se manag risk mode as, as the market evolves, pretty Ty optimistic about how with evolves, of course, and at the same time we're seeing opportunities that take mentension with respected global laser and enrichment opportunities that just really have been been thrust to the forefront just in the last 68 as a result of this effort to exclude Russia. So, from a capital allocation point of view, between balancing the risk and and looking at the reward opportunities, we we right where we want to be in terms of the balance sheet. The trigger for us thinking about different moves, of course, is is shoring up, building those homes for that production, getting our planned production back to capacity, getting out from under care and maintenance costs, matching our with here one production, which you know when you look at our financials, as they're starting to improve already- this is just beginning, I mean you still a care and maintenance costs and that are going to go away as mccar or ramps up. So we're just, you know, in that mode. We still think it's prudent to be cautious and let this market evolved and and that's what gives us the ability to be strategically patient, not have to chase contrs this market, but But let them evolves So we can capture the terms and contracts that we want. When we achieve those kind of principles, then it will be time to vieyou the the cash balance versus the run rate cash flow coming in from that contract portfolio' as it's reiltand then will be examining all of those questions. Do we have an opportunity, ate the kind of returns our investors would would expect by investing, and we don't have anything we can point to, then what's the best way to return that money to our owners? Because there far better off with it then? Then we are, and and under that analysis, as all options would be on the table, So those principles haven't changed. They really are rooted in the rebuilding of the contract portfolio and shoring up that run rate business. We're well on our way there, but I would just say cautiousically, we're not there yet, still in supply discipline mode.

Grant Isaac: Yeah. In terms of capital allocation, we are still in the mode of matching risk with reward. You know, ours is a market where you're hearing us, I think, talk very optimistically about the demand that's ahead of us, but keep in mind it's still ahead of us. There's still a lot of value we need to capture through our contracting. We haven't done as much as we'd want to yet. That's why we're still technically in a supply discipline mode. As we're in a supply discipline mode, we're technically over-contracted. We have more commitments than we have production coming in the door, which means we're gonna make some purchases along the way or access some of the long-term purchases that we've done.

Grant Isaac: All of that suggests to me that we're still in that self-managed risk mode as the market evolves. I'm pretty optimistic about how it evolves, of course. At the same time, we're seeing opportunities that, as Tim mentioned with respect to Global Laser Enrichment, opportunities that just really have been thrust to the forefront just in the last 60 days, as a result of this effort to exclude Russia. From a capital allocation point of view, between balancing the risk and looking at the reward opportunities, we're right where we wanna be in terms of the balance sheet.

Grant Isaac: The trigger for us thinking about different moves, of course, is shoring up building those homes for that production, getting our planned production back to capacity, getting out from under care and maintenance costs, matching our commitments with tier one production, which, you know, when you look at our financials as they're starting to improve already, this is just the beginning. I mean, we still have care and maintenance costs in there that are gonna go away as McArthur ramps up.

Grant Isaac: We're just, you know, in that mode where we still think it's prudent to be cautious and let this market evolve, and that's what gives us the ability to be strategically patient and not have to chase contracts in this market, but let them evolve so we can capture the terms and contracts that we want. When we achieve those kind of principles, then it will be time to review the cash balance versus the run rate cash flow coming in from that contract portfolio as it's rebuilt. Then we'll be examining all of those questions. Do we have an opportunity to create the kind of returns our investors would expect by investing?

Grant Isaac: If we don't have anything we can point to, then what's the best way to return that money to our owners? Because they're far better off with it than we are. Under that analysis, all options would be on the table. Those principles haven't changed. They really are rooted in the rebuilding of the contract portfolio and shoring up that run rate business. We're well on our way there, but I would just say cautiously, we're not there yet. Still in supply discipline mode.

Tim Gitzel: Patrick, to your second question, of course, it wouldn't be a Cameco quarterly conference call without talking about the CRA at some point. We thought we were done with that in February 2021 when we got a Supreme Court decision in our favor, but we're still talking about it. Just to be clear, that sweetheart deal that was made with somebody wasn't us this week. Just to be clear on that, we spent about 15 years going through multiple levels of court to get unequivocal rulings in our favor. The CRA is holding about CAD 778 million of our cash and balance sheet space, which we'd like to add to the cash deposit we have now. We're still working on it.

Speaker 10: And Patrick, to your second question course. It wouldn't be a cheicalo, courtterly conference call without talking about the C a at some point. We thought we were done with that in February of 2021 when we got a Supreme Court decision in our favor, but we're still talking about it. Just to be clear, that sweetheart deal that was made with somebody- it wasn't us- this week. So just to be clear on that, we spent about 15 years going through multiple levels of court to get unequivocal rulings in our favor, And so the C? R a is holding about $778 million of our cash and balance sheet basase, which we'd like to add to the to the cash deposit we have now, But So we're still working on it. To Sean, you want to give an update on where we're at with the C a Litigation every.

Tim Gitzel: Sean, do you wanna give an update on where we're at, with the CRA litigation?

Sean Quinn: Yeah, sure. I'd be pleased to. So Tim has already mentioned the initial period of dispute. It was 2003 to 2006, fully resolved in our favor. There is nothing left there. We took the decision that was ultimately ratified by the Supreme Court of Canada back and said, based on this, all subsequent years should be similarly treated and resolved and our cash and letters of credit released. That position wasn't accepted by the CRA, so we put the years 2007 to 2013 back into the litigation process. That litigation process is still, I would say, in the early innings. We filed what's called a notice of appeal. The CRA through the DOJ, the Department of Justice, has provided us with a reply.

Speaker 48: So Tim was already mentioned. The initial where a distripute o 3, two zero six fully resolved in our favor. There is nothing left there. We took the decision was ultimately ratified by the Supreme Court of Canada back and that, based on this, all subsequent years should be similarly treated and resolved and our cash, that is a credit, released. That position wasn't by the SIA, So we put the year o seven to 13 back into the litigation process. That litigation process still, I would CA say. In the early inning we filed what's called the notice of appeal, the the SI to the D o J Department of justicees. It provided Li, So there is a long way to go with with the car. In the meantime, in terms of the mter Ring up, the court cast court Jud.

Sean Quinn: There's a long way to go if we don't work this through with the CRA in the meantime in terms of the matter ending up before the Tax Court judge.

Speaker 1: Great Thank you. Thanks, Patrick.

Greg Barnes: Great. Thank you.

Patrick Sajecki: Great. Thank you.

Tim Gitzel: Thanks, Patrick.

Operator: We have a follow-up question from Greg Barnes with TD Securities. Please go ahead.

Speaker 14: We have a follow up question from Greg Barnes with Tv Securities. Please go ahead.

Speaker 31: Can you talk a little bit about the ultimate route for the incurin material out of caextent? They go through China, through that capian seae.

Greg Barnes: Yeah, thanks. Can you talk a little bit about the ultimate routes for the Inkai material out of Kazakhstan? Does it go through China, go through that Caspian Sea route? What routes are you looking at?

Speaker 31: What what lookves? You re looking at.

Tim Gitzel: Yeah, Greg, that's a great question. That is the route across the Caspian, over into the Black Sea and then down into the Mediterranean at some point. We understand they've tested that route, and so we're working with them on that. That would be, I think, the other alternative. I don't think going east is an option through China, at least for our material. You've got it right, Greg. That is the option.

Speaker 10: Yes Greg, that's a great question. That is that the route across the Caspian alert into the, the Black Sea and then down into the Mediterranean at some point. So- and we understand they ve tested that route And so we're working with them on that- that would be, I think, the other alternative. I don't think going East is an option- through China, least for our material and so that you've got it right crg, that is the option.

Greg Barnes: How much volume can you put down that route? Is it like a one-off thing or could Kazakhstan get all of their uranium out to that route? Do you know?

Speaker 9: And how much volume can you put down that root of it?

Greg Barnes: How much volume can you put down that route? Is it like a one-off thing or could Kazakhstan get all of their uranium out to that route? Do you know?

Speaker 31: Like a one off thing or could. Could kind of ext get all that? You're any amoutt to that?

Tim Gitzel: Yeah, I guess, Greg, we don't know that yet. I think they're still using St. Petersburg to some extent, so we'll have to figure that out. This is pretty recent for us, Greg, and we'll have to figure that out in the next couple weeks and months.

Speaker 10: Yes I guess, Greg. We don't know. We don't know that yet. I think they're still using as st Petersburg to some extent, So we'll have to figure that out. This is pretty recent for us crg, And so we'll have to figure that over the next couple of weeks and months.

Greg Barnes: Okay. Thank you.

Speaker 31: Okay okay, Thank you.

Tim Gitzel: Thank you.

Speaker 31: This concludes the question-and-answer session. I'd like to turn the conference back over to Tim get o for closing remarks.

Operator: This concludes the question and answer session. I'd like to turn the conference back over to Tim Gitzel for closing remarks.

Tim Gitzel: Well, thank you, operator. With that, I just wanna say thank you to everybody who joined us on the call today. We, as always, appreciate your interest and your support. Just a couple words. You know, our world today is facing some pretty significant challenges, including decarbonization, electrification, while ensuring energy affordability and security without jeopardizing the ambitious net zero targets that have been set around the world. There's a lot of uncertainty in the world energy landscape, and a lot of countries are having to take a hard look at where they should get their fuel. More than ever, the world's looking for a stable, reliable, and politically dependable fuel supply. I believe we are witnessing a fundamental change that will alter the way countries approach their energy needs going forward.

Speaker 10: Well Thank you, operator. And with that I just want to say thank you to everybody who joined us on the call today. We, as always, appreciate your interest in your support. Just a couple of words. Our world today is facing some pretty significant challenges, including dey-carbonization electrification, while ensuring energy affordability and security without jeopardizing the ambitious net zero targets that have been set around the worldthere's a lot of uncertainty in the world energy and landscape, and a lot of countries are having to take a hard look and where they should get their fuel.

Speaker 8: More than ever, the world is looking for a stable, reliable and politically dependable fuel supply.

Speaker 8: I believe we are witnessing a fundamental change that will alter the late countries approach their energy needs going forward and I think anyone who look seriously at the global issues we're facing would say that there's no solution without nuclear.

Tim Gitzel: I think anyone who looks seriously at the global issues we're facing would say that there's no solution without nuclear. We see a lot of opportunity ahead of us with demand for safe, reliable, affordable, and carbon-free baseload electricity coming from across the globe. As a responsible commercial supplier with a strong balance sheet, long-lived tier one assets, and a proven operating track record and line of sight to return to our tier one cost structure, we at Cameco believe we are extraordinarily well-positioned to respond to changing market dynamics. We're excited about the future we're seeing for nuclear power generation. We're excited about the fundamentals for nuclear fuel supplies, and we're excited about the prospects for our company. We will continue to do what we said we would do, executing on our strategy.

Speaker 40: So we see a lot of opportunity ahead of us, with demand for safe reliable, affordable and carbon-free baseload electricity coming from across the globe.

Speaker 7: As a responsible commercial supplier with a strong balance sheet, long-lived Tier one assets in a proven operating track record and land of stateite. To return to our Tier one cost structure, we at chemo believe we are extraordinarily well positioned to respond to changing market dynamics.

Speaker 7: We're excited about the future we're seeing for nuclear power generation, we're excited about the fundamentals for nuclear fuel supplies and we're excited about the prospects for our company.

Speaker 40: We will continue to do what we said we would do, executing on our strategy and consistent with our values. We will do so in a manner we believe we will make our business sustainable over the long term.

Tim Gitzel: Consistent with our values, we will do so in a manner we believe will make our business sustainable over the long term. We will continue to make the health and safety of our workers, their families, and their communities our priority. Thanks again, everybody. Stay safe and healthy, and talk to you again soon. Thank you.

Speaker 40: And we will continue to make the health and safety of our workers, their families and their communities are a priority. So thanks again. Everybody stays safe and healthy and talk to you against you, Thank you.

Speaker 22: This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

Operator: This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.

Speaker 31: I.

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