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<SEC-DOCUMENT>0001130319-05-000436.txt : 20060810
<SEC-HEADER>0001130319-05-000436.hdr.sgml : 20060810
<ACCEPTANCE-DATETIME>20050713113213
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001130319-05-000436
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20050713

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CAMECO CORP
		CENTRAL INDEX KEY:			0001009001
		STANDARD INDUSTRIAL CLASSIFICATION:	MISCELLANEOUS METAL ORES [1090]
		IRS NUMBER:				980113090
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		2121 11TH ST W
		CITY:			SASKATOON
		STATE:			A9
		ZIP:			S7M 1J3
		BUSINESS PHONE:		3069566200

	MAIL ADDRESS:	
		STREET 1:		2121 11TH ST W.
		CITY:			SASKATOON
		STATE:			A9
		ZIP:			S7M 1J3
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
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<P align="center" style="font-size: 10pt"><IMG src="o17368o1736800.gif" alt="(CAMECO LOGO)">

<DIV align="center">
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    <TD width="66%">&nbsp;</TD>
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<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><B>O. KIM GOHEEN</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">July&nbsp;11, 2005</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>Senior Vice-President,<BR>
and Chief Financial Officer</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">VIA FACSIMILE &#038; COURIER (202)&nbsp;772-9220
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><B>CAMECO CORPORATION</B></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Ms. Jill Davis
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>Corporate Office</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Branch Chief
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>2121 &#150; 11th Street West</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">United States Securities and Exchange Commission
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>Saskatoon, Saskatchewan</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Division of Corporation Finance
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>Canada S7M 1J3</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Mail Stop 70-10</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">100 &#147;F&#148; Street, NE.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Washington, DC 20549
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>Tel: 306.956.6256</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>Fax: 306.956.6312</I></FONT></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">Dear Ms.&nbsp;Davis:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT style="font-size:8pt"><I>www.cameco.com</I></FONT></TD>
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<P align="left" style="font-size: 10pt"><B>Cameco Corporation<BR>
Form 40-F for the Year Ended December&nbsp;31, 2004<BR>
File number 001-14228<BR>
Supplemental Response dated May&nbsp;27, 2005</B>

<P align="left" style="font-size: 10pt">I am writing to respond to your June&nbsp;21, 2005 letter, where you provide a list of additional
questions relating to the application of Cameco&#146;s revenue recognition policy to its uranium
business. Our responses to your questions are below. We have reproduced each question and have
assigned it a number. Our responses were prepared in consultation with KPMG LLP, Cameco&#146;s external
auditors.


<P align="left" style="font-size: 10pt">As requested in SEC Question 15, attached as Exhibits A, B, and C are sample contracts for each
type of revenue transaction described in our revenue recognition policy. Each of these contracts is
representative of its respective type of uranium sale arrangement. To comply with Cameco&#146;s
confidentiality commitments to its customers, any information related to the customers who signed
these contracts has been redacted. In addition, pursuant to the SEC&#146;s Rule&nbsp;83, confidential
treatment is being requested of the entire contracts, which have been redacted from the EDGAR
filing. In our responses below, we refer to the provisions of these sample contracts to assist you
to understand our business. These sample contracts are:



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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">1)&nbsp;&nbsp;</TD>
    <TD>Exhibit&nbsp;A is a uranium concentrates purchase agreement that was signed in 2004. Uranium
concentrates is also called yellowcake. This is an example of the first type of uranium sale
arrangement in our business, where Cameco sells and delivers yellowcake to the customer.
From now on in this letter, I will refer to this contract as a &#147;Concentrates Purchase
Agreement.&#148;</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">2)&nbsp;&nbsp;</TD>
    <TD>Exhibit&nbsp;B is a UF<SUB>6</SUB> Conversion Services Agreement that was signed in 2004. This is
a toll conversion contract, representing an example of the second type of uranium sale
arrangement in our business, where Cameco toll converts customer-owned yellowcake into
UF<SUB>6</SUB> and delivers the UF<SUB>6</SUB> to the customer. From now on in this letter, I
will refer to this contract as a &#147;Conversion Services Agreement&#148;.</TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">3)&nbsp;&nbsp;</TD>
    <TD>Exhibit&nbsp;C is a UF<SUB>6</SUB> Supply Agreement that was signed in 2004. This represents the
third type of uranium sale arrangement in our business, where Cameco converts Cameco-owned
yellowcake into UF<SUB>6</SUB> and delivers the UF<SUB>6</SUB> to the customer. From now on in
this letter, I will refer to this contract as a &#147;UF<SUB>6</SUB> Supply Agreement&#148;.</TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt"><U>Form&nbsp;40-F for the Year Ended December&nbsp;31, 2004</U>



<P align="left" style="font-size: 10pt"><U>2004 Consolidated Financial Statements</U>



<P align="left" style="font-size: 10pt"><U>Revenue Recognition, Page 40</U>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;1


<P align="left" style="font-size: 10pt"><I>Tell us whether there is provisional pricing in yellowcake sales. Explain to us what the &#147;firm&#148;
price is based upon, and whether it is based upon the quantity of yellowcake processed or whether
it considers the quality of and quantity of converted uranium produced.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>There is no provisional pricing in yellowcake sales. For yellowcake sales, the price is firm in
that:</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>The price per pound of yellowcake is fixed by either being
specified exactly in the contract or derived by a uranium spot
price related formula specified in the contract (see section 3.01
of the Concentrates Purchase Agreement and our response to
question 2 for more information on uranium spot related pricing in
our yellowcake sales contracts).</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>There are no adjustment clauses in our yellowcake sale contracts
to adjust the price per pound, after invoicing, based upon
quantity and quality of yellowcake sold to the customer.</B></TD>
</TR>

</TABLE>

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<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>The amount payable by the customer equals the product of the number of pounds of yellowcake
(in other words quantity) book transferred into the customer&#146;s account and the price per
pound provided in the contract. (See sections 3.02 and 5.01 of the Concentrates Purchase
Agreement.)</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>The quality of yellowcake is not a factor in determining the
price. Cameco warrants to its customer all yellowcake supplied
conforms to stipulated quality specifications. (See section
2.</B><B>03(b)</B><B> of the Concentrates Purchase Agreement as well as our
response below to SEC Question No 8 which indicates we have not
received a warranty claim for non-conformance with specifications
over the past 10&nbsp;years.)</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>The quantity of yellowcake to be delivered is determined by the
contract. The price charged to a customer does not vary based upon
quantities delivered to that customer.</B></TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt"><B>We also confirm there is no provisional pricing for toll conversion services and UF<SUB>6</SUB>
supply arrangements.</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;2


<P align="left" style="font-size: 10pt"><I>Tell us whether there is an active market for uranium in yellowcake form.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>There is an active market for uranium supply in yellowcake form. This active market is reflected by
the following:</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>Independent third party agencies report the price of yellowcake sold in the &#147;spot market&#148;
and contracted to be sold under long term contracts. Often these third party agency reports
are used to determine the price of yellowcake sold by Cameco to a customer. For example, see
the definition of Concentrates Price in section 3.01 of the Concentrates Purchase Agreement.
More information on these third party agencies can be found on their websites
(</B><U><B>www.uxc.com</B></U><B> and www.uranium.info).</B></TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;3


<P align="left" style="font-size: 10pt"><I>Confirm that you sell uranium in yellowcake form on a standalone basis without providing conversion
services.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>Yes, we do. For an example, please see the Concentrates Purchase Agreement.</B>



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<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;4


<P align="left" style="font-size: 10pt"><I>Confirm that you perform conversion services on yellowcake of which you are not the supplier.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>Yes, we do. For an example, please see the Conversion Services Agreement.</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;5


<P align="left" style="font-size: 10pt"><I>Arrangements for which you are both the supplier and the converter, tell us what happens if you
sell yellowcake and deliver it to your conversion facilities but conversion is never completed.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>In the case of a UF<SUB>6</SUB> supply agreement, where Cameco supplies yellowcake as well as
performs conversion services, delivery of the yellowcake and conversion services to the customer
occurs simultaneously (See UF<SUB>6</SUB> Supply Agreement).</B>


<P align="left" style="font-size: 10pt"><B>In addition, there are situations where Cameco sells yellowcake to its customer under the first
type of uranium sale arrangement (see the Concentrates Purchase Agreement) and also has a contract
with the same customer to provide toll conversion services (see Conversion Services Agreement). In
these situations, Cameco recognizes revenue separately under the individual contracts.</B>


<P align="left" style="font-size: 10pt"><B>We have considered the possibility that these separate contracts could be viewed as multiple
deliverable arrangements. In so doing, we have reviewed and considered the implications of applying
the EITF 00-21, Revenue Arrangements with Multiple Deliverables, and concluded that the accounting
would not change as the uranium and toll conversion components of the arrangement would be
considered separate units of accounting. The first criterion for separation is met for both
uranium and conversion because each is sold separately by other suppliers. The second criterion is
also met, as there is objective evidence of the fair value for both uranium and conversion. The
pricing in Cameco&#146;s sales contracts is either based upon or refers to market values (i.e. spot
prices) for uranium or conversion. The third criterion is met because there are no general rights
of return.</B>


<P align="left" style="font-size: 10pt"><B>Cameco has never experienced the situation described in your question. Under a uranium sales
contract, if Cameco sold and book transferred yellowcake to a customer&#146;s account at its facilities,
Cameco&#146;s experience is that the yellowcake will ultimately be toll converted by Cameco into
UF<SUB>6</SUB> and book transferred to the customer&#146;s account at an Enricher under a toll
conversion contract.</B>



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<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;6


<P align="left" style="font-size: 10pt"><I>Explain the terms of the sale/transfer of converted uranium to the enricher or fuel fabricator.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>Cameco does not sell converted uranium (UF<SUB>6</SUB>) to fuel fabricators. However, Cameco does
sell a very small quantity of UF<SUB>6</SUB> to Enrichers. They are just another customer for
Cameco&#146;s UF<SUB>6</SUB>. Enrichers, in turn, will enrich the UF<SUB>6</SUB> bought from Cameco and
sell this enriched product to their customers.</B>


<P align="left" style="font-size: 10pt"><B>These UF<SUB>6</SUB> sales take place by way of the third type of uranium sale arrangement (see
UF<SUB>6</SUB> Supply Agreement) and on the same terms as UF<SUB>6</SUB> sales to Cameco&#146;s utility
customers.</B>


<P align="left" style="font-size: 10pt"><B>Also see our response to your question 7.</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;7


<P align="left" style="font-size: 10pt"><I>We note once the enricher analyzes the content of the converted uranium it receives from you, it is
transferred from your account to the customer&#146;s account (book transfer). Please explain how the
book transfer occurs again from company&#146;s account to customer&#146;s account when you have stated that
such transfer occurred at the beginning of the conversion process.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>Our response is based upon your question relating to a book transfer at an Enricher under the
second type of uranium sale arrangement (see Conversion Services Agreement) and under the third
type of uranium sale arrangement (see UF<SUB>6</SUB> Supply Agreement).</B>



<P align="left" style="font-size: 10pt"><B><I>Physical Inventory Transfer</I></B>


<P align="left" style="font-size: 10pt"><B>Cameco stores inventory of UF<SUB>6</SUB> at enrichment facilities in the United States and the EU.
To maintain inventory at each Enricher:</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>Cameco physically delivers UF<SUB>6</SUB> to an Enricher&#146;s
facility. Based upon Cameco&#146;s shipping documents, the Enricher
credits Cameco&#146;s account with the volume of delivered
UF<SUB>6</SUB>.</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>The Enricher will analyze the delivered UF<SUB>6</SUB> to ensure
that it meets the UF<SUB>6</SUB> ASTM standard (an industry
standard specification.) and to confirm that Cameco&#146;s declared
volume of delivered UF<SUB>6 </SUB>is correct. Based upon its
analysis, if necessary, the Enricher will adjust Cameco&#146;s account
and this adjustment will be reflected in Cameco&#146;s carrying value
of its inventory.</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>Cameco maintains this transferred UF<SUB>6</SUB> as inventory
until it is sold and book transferred to the customer.</B></TD>
</TR>

</TABLE>

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</TABLE>


<P align="left" style="font-size: 10pt"><B><I>Sale / Book Transfer Process</I></B>


<P align="left" style="font-size: 10pt"><B>For the second type of uranium sale arrangement (see Conversion Services Agreement) and the third
type of uranium sale arrangement (see UF<SUB>6</SUB> Supply Agreement), the steps in the book
transfer process at the Enricher is as follows:</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>Cameco&#146;s customer will request delivery of a certain volume of
UF<SUB>6</SUB> at the Enricher&#146;s facility on a specified date.
This notice is given several months prior to the requested
delivery date. (See section 3.2 of the Conversion Services
Agreement. The sample UF<SUB>6</SUB> Supply Agreement is
different than most Cameco UF<SUB>6</SUB> supply arrangements in
that the delivery date at the Enricher is specified in the
agreement (see Section&nbsp;2.02 of the UF<SUB>6</SUB> Supply
Agreement)).</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left">&#149;&nbsp;&nbsp;</TD>
    <TD><B>Cameco will direct the Enricher to transfer the requested volume
of UF<SUB>6</SUB> by book transfer to the customer&#146;s account at
the Enricher&#146;s facility on a specified delivery date. <U>Once this
book transfer occurs, this is the point at which Cameco invoices
the customer and records revenue.</U> (See sections 3.6, 5.2 and 5.3
of the Conversion Services Agreement and sections 2.04 and 3.03 of
the UF<SUB>6</SUB> Supply Agreement).</B></TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;8


<P align="left" style="font-size: 10pt"><I>Tell us who bears the risk if uranium sold and transferred to the converter does not meet the
minimum operating specifications, or if the converted uranium transferred to the enricher does not
meet the UF<SUB>6</SUB> ASTM standard.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>In both cases, Cameco bears this risk, as it provides a contractual warranty that the product
supplied will conform to the specifications. (See section 2.03(b) of the Concentrates Purchase
Agreement; see section 3.4(c) of the Conversion Services Agreement; and see section of 2.05 (b)&nbsp;of
the UF<SUB>6</SUB> Supply Agreement).</B>


<P align="left" style="font-size: 10pt"><B>Cameco has examined its past 10&nbsp;years of uranium sales activity and confirms there has not been a
warranty claim against it over that period for non-conformance with specifications.</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;9


<P align="left" style="font-size: 10pt"><I>We note you refer to a fixed schedule for delivery in the contracts. Tell us if you are referring
to the date of book transfer to the customer&#146;s account prior to conversion or prior to enrichment,
or the date of physical delivery of uranium in its final form for which you are responsible to the
enricher, fuel fabricator or the customer.</I>




<P align="center" style="font-size: 10pt">&nbsp;
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<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>The fixed schedule for the delivery in the contracts refers to the date for delivery to the
customer by book transfer. Under a yellowcake sales contract, the book transfer of yellowcake takes
place prior to conversion. Under a toll conversion services contract and a UF<SUB>6</SUB> supply
contract, book transfer of UF<SUB>6</SUB> takes place prior to enrichment.</B>


<P align="left" style="font-size: 10pt"><B>Cameco physically delivers yellowcake to a converter and converted uranium to an enricher. Based
Cameco&#146;s shipping documents, each facility credits Cameco&#146;s account with the volume of delivered
product. This physical delivery of product, in the final form for which Cameco is responsible,
takes place before a sale (and book transfer) to a customer and enables Cameco to maintain an
inventory of product and subsequently make the book transfer to the customer.</B>


<P align="left" style="font-size: 10pt"><B>Below are details on how this fixed schedule for the date of delivery is determined under each form
of uranium sale arrangement, referring to each of sample contracts sent to you.</B>


<P align="left" style="font-size: 10pt"><B>Under the sample Concentrates Purchase Agreement (first type of uranium sale arrangement):</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the customer has committed to take two deliveries of yellowcake
(see section 2.01 and the definitions of Contract Quantity,
Delivery Quantity 1, Delivery Quantity 2, Delivery Date, Delivery
Date 1 and Delivery Date 2 contained in section 1.01 of the
Concentrates Purchase Agreement); and</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the date Cameco completes the book transfer from its account at
the Converter to the customer&#146;s account is the date of delivery
(see section 5.01 of the Concentrates Purchase Agreement). </B><U><B>This is
the point that Cameco invoices the customer and records revenue.</B></U><B>
(See section 3.02 of the Concentrates Purchase Agreement.)</B></TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt"><B>Under the sample Conversion Services Agreement (the second type of uranium sale arrangement):</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the customer commits to take delivery of an annual quantity of
conversion services (see section 3.3 of the Conversion Services
Agreement);</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the customer gives a notice to fix a delivery date to take
delivery of a quantity of UF<SUB>6</SUB> by book transfer at a
location its selects (see section 3.2 of the Conversion Services
Agreement);</B></TD>
</TR>

</TABLE>

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<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the customer then is required to deliver to Cameco a sufficient quantity of yellowcake for
conversion in order for Cameco to complete the conversion process and deliver the requested
quantity of UF<SUB>6</SUB>. (See section 3.2, the last sentence of section 2.2 (b)&nbsp;and the
definitions of Accepted Concentrates and Preparation Period in section 1.1 of the Conversion
Services Agreement.) All conversion contracts are the same in this regard, whether the
yellowcake was purchased from Cameco or another supplier; and</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the date Cameco completes the book transfer requested in the customer&#146;s notice is </B><U><B>the
point that Cameco invoices the customer and records revenue.</B></U><B> (See sections 3.6 and 5.2 of
the Conversion Services Agreement.)</B></TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt"><B>Under the sample UF<SUB>6</SUB> Supply Agreement (the third type of uranium sale arrangement-
delivery of converted uranium in the form of UF<SUB>6</SUB>):</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the customer commits to take delivery of a quantity of
UF<SUB>6</SUB> (see Section&nbsp;2.02 of the UF<SUB>6</SUB> Supply
Agreement);</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the delivery date at the Enricher is specified (see 2.02 of the
UF<SUB>6</SUB> Supply Agreement)); and</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>the date Cameco completes the book transfer at the Enricher to the
customer&#146;s account </B><U><B>is the point that Cameco invoices the customer
and records revenue.</B></U><B> (See sections 2.02 and 3.03 of the
UF<SUB>6</SUB> Supply Agreement.)</B></TD>
</TR>

</TABLE>

<P align="left" style="font-size: 10pt"><B>In each case, Cameco will have ensured that the inventory of product is physically on hand at the
delivery site specified in the contract prior to the sale and book transfer taking place.</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;10


<P align="left" style="font-size: 10pt"><I>Tell us how the customer is bearing the risk during the conversion process as to inventory risk of
loss or diminution, price risk, quality and quantity risk, etc.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>Our response is based on your seeking clarification of the customer&#146;s risk associated with the toll
conversion (the second type of uranium sale arrangement) by Cameco of the customer&#146;s yellowcake
into UF<SUB>6</SUB>. In this process, the customer&#146;s risk is as follows:</B>



<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>When you refer to inventory risk of loss and quantity risk, we
assume you are referring to risk of damage to the yellowcake,
which is to be converted, and the resulting converted uranium. In
both cases, while either good is in Cameco&#146;s possession, Cameco,
not the customer, assumes this risk, for which it carries
insurance. (See sections 3.</B><B>12(l)</B><B>, 7.1 and 7.2 of the Conversion
Services Agreement.) When the converted uranium is physically
delivered into the possession of the Enricher, the Enricher
assumes this risk.</B></TD>
</TR>

</TABLE>

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<P><TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">



</TABLE>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>As part of the conversion process, a small percentage of the
customer&#146;s yellowcake is not recovered and this is a processing
loss which the customer accepts. This is standard in the industry.
(In the Conversion Services Agreement, this defined in section 1.1
as the &#147;UF<SUB>6</SUB> Yield&#148; and this term is used in the first
sentence of Section&nbsp;2.2 (b).)</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>There is no price risk for the yellowcake which is to be
converted. The customer has already paid for the yellowcake.</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>There is no price risk for toll conversion services once the
customer has taken delivery of the converted uranium. The pricing
mechanism under toll conversion agreements fixes the price at the
date of delivery. (See sections 4.2, 5.1, and 5.2 of the
Conversion Services Agreement).</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>The customer does not bear quality risk for the converted uranium.
(See section 3.</B><B>4(c)</B><B> of the Conversion Services Agreement and our
response to your question 8.)</B></TD>
</TR>

<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD><B>The customer, as owner of the yellowcake and purchaser of the
conversion services, bears the economic risk for loss in market
value of the products if it elects to subsequently sell the
converted uranium.</B></TD>
</TR>

</TABLE>


<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;11


<P align="left" style="font-size: 10pt"><I>Explain to us how product purchased by a customer is not used to fill other orders if it is not
physically separated.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>Due to the nature of yellowcake and converted uranium (yellowcake is stored in drums and converted
uranium is stored in specialized containers) which is fungible, industry participants do not
physically segregate products owned or purchased by the customer and instead they are commingled
with their own inventory of these products. This is recognized by Cameco&#146;s customers. (See
sections 2.8 and 3.7(k) of the Conversion Services Agreement.)</B>


<P align="left" style="font-size: 10pt"><B>As specified in note 3 to Cameco&#146;s 2004 audited financial statements, Cameco carries an inventory
of uranium concentrate (yellowcake)&nbsp;valued in excess of $300&nbsp;million (Canadian) and conversion
services valued in excess of $36&nbsp;million (Canadian).</B>


<P align="left" style="font-size: 10pt"><B>This significant inventory position is intended to ensure that Cameco can meet its delivery
obligations if a production interruption occurs at its uranium mining or uranium conversion
facilities. This inventory position represents Cameco-owned product and does not include
customer-owned product stored by Cameco. Cameco does not drawdown upon customer-owned product to
make a delivery.</B>



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<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;12


<P align="left" style="font-size: 10pt"><I>Tell us how long the process takes from yellowcake sale to when it is book transferred to a
customer&#146;s account by the converter, how long conversion takes, and how long until the enricher
determines that the converted uranium meets the ASTM standard.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>As described in our response to questions 7 and 8, the customer only receives yellowcake that meets
contract specifications and converted uranium that meets the ASTM standard. There is no time delay
between when revenue is recognized and product quality has been confirmed.</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;13


<P align="left" style="font-size: 10pt"><I>We note you have three types of uranium sale arrangements: 1) uranium supply, 2) toll conversion
services and 3) conversion supply (a combination of uranium supply and toll conversion services).
Please provide a separate SAB 104 analysis for each arrangement, and clarify when revenue is
recognized for each type of arrangement.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>



<P align="left" style="font-size: 10pt"><B>Please see our response that is attached as table 13.1</B>



<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;14


<P align="left" style="font-size: 10pt"><I>When you have contracted to provide bundled supply and conversion services, tell us if this is
written as one or more contracts.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>When Cameco contracts to provide the third form of uranium supply (Cameco supplied uranium that is
converted into UF<SUB>6</SUB>), this is written as one contract. The UF<SUB>6</SUB> Supply
Agreement is an example of such a contract.</B>


<P align="left" style="font-size: 10pt"><B>Also please see our discussion in question 5 where uranium supply and conversion services are
provided to a customer through two contracts.</B>



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<P align="left" style="font-size: 10pt">SEC Question No.&nbsp;15


<P align="left" style="font-size: 10pt"><I>Provide us with a sample copy of a contract for each type of revenue transaction described in your
revenue recognition policy.</I>



<P align="left" style="font-size: 10pt"><U><B>Cameco Response</B></U>


<P align="left" style="font-size: 10pt"><B>As noted above, attached to this letter are the Concentrates Purchase Agreement, the Conversion
Services Agreement, and the UF<SUB>6</SUB> Supply Agreement.</B>



<P align="left" style="font-size: 10pt">Yours truly,



<P align="left" style="font-size: 10pt"><I>&#147;O. Kim Goheen&#148;</I>



<P align="left" style="font-size: 10pt">O. Kim Goheen


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="3%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="95%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">c:
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Yong Choi, Securities and Exchange Commission</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Gerald W. Grandey, President and Chief Executive Officer, Cameco Corporation</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">KMPG LLP</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


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<P align="center" style="font-size: 10pt">Exhibit&nbsp;A



<P align="center" style="font-size: 10pt">Uranium Concentrates Purchase Agreement<BR>
&#091;Redacted&#093;



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="center" style="font-size: 10pt">Exhibit&nbsp;B



<P align="center" style="font-size: 10pt">UF<SUB>6</SUB> Conversion Services Agreement<BR>
&#091;Redacted&#093;



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">




<P align="center" style="font-size: 10pt">Exhibit&nbsp;C



<P align="center" style="font-size: 10pt">UF<SUB>6</SUB> Supply Agreement<BR>
&#091;Redacted&#093;




<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

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<P align="center" style="font-size: 10pt"><B>TABLE 13.1</B>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>SAB 104</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Uranium</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Toll</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Conversion Supply</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Criteria</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Supply</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Conversion</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>(Converted Uranium)</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="top">
    <TD valign="top"><DIV style="margin-left:15px; text-indent:-15px"><B>1.&nbsp;&nbsp;Persuasive
evidence of an
arrangement exists</B>
</DIV></TD>
    <TD>&nbsp;</TD>

<TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Uranium is
sold to customers
under duly
authorized
contracts which
contain
descriptions of the
specific terms of
the arrangement.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Conversion
services are sold
to customers under
duly authorized
contracts which
contain
descriptions of the
specific terms of
the arrangement.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Converted
uranium is sold to customers under
duly authorized
contracts which
contain
descriptions of the
specific terms of
the arrangement.</DIV></TD>
</TR>

<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The terms
of the contracts
are explicit as to
the nature of the
product to be
provided, timing of
delivery, price and
payment terms.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The terms
of the contracts
are explicit as to
the nature of the
product to be
provided, timing of
delivery, price and
payment terms.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The terms
of the contracts are explicit as to
the nature of the
product or service
to be provided,
timing of delivery,
price and payment
terms.</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:15px; text-indent:-15px"><B>2.&nbsp;&nbsp;Delivery has
occurred or
services have been
rendered</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Nuclear
fuel products are
required to be
stored at a
licensed facility
until being shipped
to another licensed
facility for
further processing
(such as
conversion,
enrichment or
fabrication).</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Nuclear
fuel products are
required to be
stored at a
licensed facility
until being shipped
to another licensed
facility for
further processing
(such as
conversion,
enrichment or
fabrication).</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Nuclear
fuel products are
required to be stored at a
licensed facility
until being shipped
to another licensed
facility for
further processing
(such as
conversion,
enrichment or
fabrication).</DIV></TD>
</TR>

<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Cameco
physically delivers
uranium to
conversion
facilities in
advance of sales to
customers.
Inventory is held
in Cameco&#146;s account
at these
facilities.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Cameco
physically delivers
converted UF<SUB>6</SUB> to
enrichment
facilities in
advance of sales to
customers.
Inventory is held
in Cameco&#146;s account
at these
facilities.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Cameco
physically delivers
converted UF<SUB>6</SUB> to
enrichment
facilities in
advance of sales to
customers.
Inventory is held
in Cameco&#146;s account
at these
facilities.</DIV></TD>
</TR>

<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;In the
uranium business,
at the time of
sale, delivery of
product is
typically effected
via &#147;book transfer&#148;
at a conversion
facility from
Cameco&#146;s account to
the customer&#146;s
account.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;In the
conversion services
business, at the
time of sale,
delivery is
typically effected
via &#147;book transfer&#148;
at an enrichment
facility from
Cameco&#146;s account to
the customer&#146;s
account.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;In the uranium
and conversion
services businesses
at the time of
sale, delivery is
typically effected
via &#147;book transfer&#148;
at an enrichment
facility from
Cameco&#146;s account to
the customer&#146;s
account.</DIV></TD>
</TR>


<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>

<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:15px; text-indent:-15px"><B>&nbsp;</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Given that
the customer does
not take physical
possession until
further processing
occurs, Cameco
considers other
factors in
assessing whether
or not this
criterion has been
met. These factors
are described in
items 2a) through
2h).</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Given that
the customer does
not take physical
possession until
further processing
occurs, Cameco
considers other
factors in
assessing whether
or not this
criterion has been
met. These factors
are described in
items 2a) through
2h).</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Given that
the customer does
not take physical
possession until
further processing
occurs, Cameco
considers other
factors in
assessing whether
or not this
criterion has been
met. These factors
are described in
items 2a) through
2h).</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>SAB 104</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Uranium</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Toll</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Conversion Supply</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Criteria</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Supply</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Conversion</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>(Converted Uranium)</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-23px"><B>2 a) Risks and
rewards of
ownership
</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Legal title
is transferred to
the buyer.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Legal title
is transferred to
the buyer.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Legal title
is transferred to
the buyer.</DIV></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-0px"><B>transferred to the
buyer.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Price is
fixed and the buyer
is obligated to
pay.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Price is
fixed and the buyer
is obligated to
pay.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Price is
fixed and the buyer
is obligated to
pay.</DIV></TD>
</TR>

<TR>
<TD>&nbsp;</TD>
</TR>


<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The buyer
bears all risks
associated with a
decline in the
market value of any
goods or services
provided.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The buyer
bears all risks
associated with a
decline in the
market value of any
goods or services
provided.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The buyer
bears all risks
associated with a
decline in the
market value of any
goods or services
provided.</DIV></TD>
</TR>
<TR>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Any storage
risk (product risk
of the buyer)
retained by Cameco
is insured.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Any storage
risk (product risk
of the buyer)
retained by Cameco
is insured.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Any storage
risk (product risk
of the buyer)
retained by Cameco
is insured.</DIV></TD>
</TR>
<TR>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Contracts
include buyer&#146;s
indemnification to
Cameco for any
third party claims
relating to the
uranium sold to the
buyer.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Contracts
include buyer&#146;s
indemnification to
Cameco for any
third party claims
relating to the
conversion sold to
the buyer.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Contracts
include buyer&#146;s
indemnification to
Cameco for any
third party claims
relating to the
converted uranium
sold to the buyer.</DIV></TD>
</TR>
<TR>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-23px"><B>2 b) Customer has
made a firm
commitment to</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Supported
by legally binding
contracts signed in
advance of the sale
occurring.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Supported
by legally binding
contracts signed in
advance of the sale
occurring.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Supported
by legally binding
contracts signed in
advance of the sale
occurring.</DIV></TD>
</TR>









<TR valign="top">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-0px"><B>purchase the</B>
</DIV></TD>







<TR valign="top">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-0px"><B>goods.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Customer
will remit payment
on normal
commercial terms
(i.e. 30&nbsp;days).</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Customer
will remit payment
on normal
commercial terms
(i.e. 30&nbsp;days).</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Customer
will remit payment
on normal
commercial terms
(i.e. 30&nbsp;days).</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="top">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-23px"><B>2 c) The buyer
requests that the
transaction be on a
bill and hold
basis</B>.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The terms
of the various
contracts dictate
when the book
transfer occurs.
The buyer
negotiates such
terms on the basis
of its business
requirements.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The terms
of the various
contracts dictate
when the book
transfer occurs.
The buyer
negotiates such
terms on the basis
of its business
requirements.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The terms
of the various
contracts dictate
when the book
transfer occurs.
The buyer
negotiates such
terms on the basis
of its business
requirements.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>SAB 104</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Uranium</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Toll</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Conversion Supply</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Criteria</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Supply</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Conversion</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>(Converted Uranium)</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-23px"><B>2 d) There
must be a fixed
schedule for
delivery of the goods.<BR></B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The date
for delivery is
determined in
accordance with the
terms of the
contract.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The date
for delivery is
determined in
accordance with the
terms of the
contract.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The date
for delivery is
determined in
accordance with the
terms of the
contract.</DIV></TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-0px"><B>&nbsp;</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Periods of
storage are normal
in the industry.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Periods of
storage are normal
in the industry.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Periods of
storage are normal
in the industry.</DIV></TD>
</TR>

<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Storage is
not provided for an
indefinite period
of time.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Storage is
not provided for an
indefinite period
of time.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Storage is
not provided for an
indefinite period
of time.</DIV></TD>
</TR>

<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center">&nbsp;</TD>
</TR>


<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The
customer may be
charged a fee for
storage that is
outside the
industry norm.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The
customer may be
charged a fee for
storage that is
outside the
industry norm.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The
customer may be
charged a fee for
storage that is
outside the
industry norm.</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-23px"><B>2 e) The seller
retains no
significant
performance
obligations such
that the earnings
process is not
complete.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;At the time
of book transfer,
Cameco has
fulfilled all of
its
responsibilities
under the
contracted
arrangement.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;At the time
of book transfer,
Cameco has
fulfilled all of
its
responsibilities
under the
contracted
arrangement.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;At the time
of book transfer,
Cameco has
fulfilled all of
its
responsibilities
under the
contracted
arrangement.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="26%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="24%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>SAB 104</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Uranium</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Toll</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Conversion Supply</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Criteria</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Supply</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Conversion</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>(Converted Uranium)</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-23px"><B>2 f) The
ordered goods must
have been
segregated from the
seller&#146;s</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Uranium is
segregated
logically through
book transfer.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Conversion
services are
segregated
logically through
book transfer.</DIV><BR>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Uranium and
conversion services
are segregated
logically.</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:23px; text-indent:-0px"><B>inventory
and not be subject
to being used to
fill other orders.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Uranium is
fungible and
segregation is not
a practice followed
in the industry.</DIV><BR>
<DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The product
purchased by a
customer is not
subject to being
used to fill orders
for other
customers.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;UF<SUB>6</SUB> is
fungible and
segregation is not
a practice followed
in the industry. The
product purchased
by a customer is
not subject to
being used to fill
orders for other
customers.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;UF<SUB>6</SUB> is
fungible and
segregation is not
a practice followed
in the industry. The
product purchased
by a customer is
not subject to
being used to fill
orders for other
customers.</DIV></TD>
</TR>

<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The
physical movement
of nuclear fuel
products is
monitored by the
International
Atomic Energy
Agency (IAEA).
Guidelines
established by the
IAEA are intended
to ensure that
nuclear materials
are used only for
peaceful purposes.
Thus, physical
movement is tightly
controlled and very
precise inventory
records are
maintained. The
IAEA conducts
regular audits of
the facilities that
store nuclear
materials to ensure
compliance.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The
physical movement
of nuclear fuel
products is
monitored by the
International
Atomic Energy
Agency (IAEA). The
guidelines
established by the
IAEA are intended
to ensure that
nuclear materials
are used only for
peaceful purposes.
Thus, physical
movement is tightly
controlled and very
precise inventory
records are
maintained. The
IAEA conducts
regular audits of
the facilities that
store nuclear
materials to ensure
compliance.</DIV>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The
physical movement
of nuclear fuel
products is
monitored by the
International
Atomic Energy
Agency (IAEA). The
guidelines
established by the
IAEA are intended
to ensure that
nuclear materials
are used only for
peaceful purposes.
Thus, physical
movement is tightly
controlled and very
precise inventory
records are
maintained. The
IAEA conducts
regular audits of
the facilities that
store nuclear
materials to ensure
compliance.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>SAB 104</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Uranium</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Toll</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Conversion Supply</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Criteria</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Supply</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Conversion</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>(Converted Uranium)</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:30px; text-indent:-30px"><B>2 g)&nbsp;&nbsp;The
product must be
ready for shipment.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The product
is stored in
shipping containers
and is ready for
shipment at any
time.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The product
is stored in
shipping containers
and is ready for
shipment at any
time.
</DIV></TD>
    <TD>&nbsp;</TD>
        <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The product
is stored in
shipping containers
and is ready for
shipment at any
time.</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:30px; text-indent:-30px"><B>2
h)&nbsp;&nbsp;Other factors.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
        <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Cameco
extends normal
credit terms to its
customers and does
not make
exceptions.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Cameco
extends normal
credit terms to its
customers and does
not make
exceptions.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Cameco
extends normal
credit terms to its
customers and does
not make
exceptions.</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">

<TD valign="top"><DIV style="margin-left:30px; text-indent:-30px"><B>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Selling price is
fixed or
determinable.</B>
</DIV></TD>
    <TD>&nbsp;</TD>
<TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The selling
price is included
in the contract
with the customer.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The selling
price is included
in the contract
with the customer.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;The selling
price is included
in the contract
with the customer.</DIV></TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Pricing terms
may be either
base-escalated or
market-related. In
either case, the
price is fixed on
the date the book
transfer occurs.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Pricing
terms may be either
base-escalated or
market-related. In
either case, the
price is fixed on
the date the book
transfer occurs.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Pricing
terms may be either
base-escalated or
market-related. In
either case, the
price is fixed on
the date the book
transfer occurs.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<P align="center" style="font-size: 10pt">&nbsp;
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="16%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center"><B>SAB 104</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Uranium</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Toll</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center"><B>Conversion Supply</B></TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Criteria</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Supply</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>Conversion</B></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000"><B>(Converted Uranium)</B></TD>
</TR>

<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>Timing of
Revenue Recognition</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;As a supplier
of uranium, Cameco
physically delivers
uranium to a
conversion
facility. The
converter credits
Cameco&#146;s account
for the quantity of
uranium received.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;As a toll
converter, Cameco
converts
customer-owned
uranium to
UF<SUB>6</SUB> and
physically delivers
that UF<SUB>6</SUB>
to an enrichment
facility. The
enricher credits
Cameco&#146;s account
for the quantity
received.
</DIV></TD>
    <TD>&nbsp;</TD>
     <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;As a provider
of bundled uranium
and conversion
services (converted
uranium), Cameco
converts its own
uranium to
UF<SUB>6</SUB> and
subsequently
delivers the
product to an
enrichment
facility. The
enricher credits
Cameco&#146;s account
for the quantity
received.</DIV></TD>
</TR>
<TR>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Upon receiving
instructions from
Cameco, the
converter will
transfer title to
the uranium to
Cameco&#146;s customer&#146;s
account at the
conversion
facility. This is
the point in time
at which Cameco
invoices the
customer for the
uranium and records
revenue on the
sale.
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Upon receiving
instructions from
Cameco, the
enricher will
transfer title of
the conversion to
Cameco&#146;s customer&#146;s
account at the
enrichment
facility. This is
the point in time
at which Cameco
invoices the
customer for the
conversion service
and records revenue
on the sale.</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><DIV style="margin-left:8px; text-indent:-8px">&#149;&nbsp;Upon receiving
instructions from
Cameco, the
enricher will
transfer title of
the converted
material (uranium
and conversion) to
Cameco&#146;s customer&#146;s
account at the
enrichment
facility. This is
the point in time
at which Cameco
invoices the
customer for the
combined uranium
and conversion
service and records
revenue on the
sale.</DIV></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<P align="center" style="font-size: 10pt">&nbsp;
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