Saskatoon-based Cameco is the world’s largest uranium producer and is bidding for control of junior uranium miner Hathor’s Roughrider deposit in northern Saskatchewan’s Athabasca Basin. Rio Tinto is the world’s third-largest mining company and if successful in their bid for Hathor are expected to follow other mining giants like BHP Billiton and open up shop soon in Saskatoon. The bidding war is playing out as developing nations from China to India turn to nuclear power to meet energy demands in the world’s fastest-growing economies. China has 14 reactors, 27 under construction and 51 more planned, according to the World Nuclear Association’s website. India has six under construction and 17 planned, while Russia has 10 being built and 14 more in the pipeline.
“This is like two bullies in a parking lot and guessing when they are going to stop fighting,” Barry Allan, senior mining analyst at Mackie Research, said in a telephone interview for Bloomberg. “The chances of Cameco coming back with another offer are pretty high. It’s become less about value and more about strategic significance. The world has recognized it’s very difficult to live without nuclear energy.”
After the epic failed bid by BHP Billiton bid for Saskatoon-based PotashCorp in summer 2011, Saskatchewan and the city of Saskatoon in particular, have been the parking lot of choice for mining giants to duke it out over the future of the vast natural resources in Canada. Newly appointed Cameco CEO, Tim Gitzel who, like myself, recently relocated back home to Saskatchewan after living and working in Europe for many years has his work cut out for him. My feeling is that in typical prairie fashion, Mr. Gitzel will skilfully and respectfully put together a joint bid by Cameco and Rio Tinto so that Rio Tinto can take advantage of Cameco’s experience with Saskatchewan’s geology and Cameco can prolong the profitability of its nearby mill.
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