Property, plant and equipment

12 Months Ended

Dec. 31, 2017

Property Plant And Equipment [Abstract]

8. Property, plant and equipment

At December 31, 2017


	Land		Plant		Furniture				Exploration
	and		and		and		Under		and
	buildings		equipment		fixtures		construction		evaluation		Total


Cost
Beginning of year	$	4,979,489	$	2,640,543	$	95,168	$	340,340	$	1,120,641	$	9,176,181
Additions		27,343		13,649		3,521		97,729		1,091		143,333
Transfers		104,134		106,669		(2,455)		(208,359)		11		-
Change in reclamation provision [note 14]		17,541		-		-		-		-		17,541
Disposals		(4,610)		(4,803)		(4,578)		(74,482)		-		(88,473)
Pre-commercial production revenue^(a)		(22,818)		(6,487)		-		-		-		(29,305)
Effect of movements in exchange rates		(55,967)		(19,936)		(839)		(497)		(1,463)		(78,702)

End of year		5,045,112		2,729,635		90,817		154,731		1,120,280		9,140,575


Accumulated depreciation and impairment
Beginning of year		2,508,212		1,460,953		80,592		80,674		390,164		4,520,595
Depreciation charge		137,896		175,811		6,490		-		-		320,197
Transfers		48,209		(35,243)		(2,451)		(10,515)		-		-
Disposals		(2,393)		(4,130)		(3,269)		(70,159)		-		(79,951)
Impairment charges^(b)(c)		67,535		25,359		-		55,841		91,046		239,781
Effect of movements in exchange rates		(42,210)		(11,290)		(610)		(9)		2,180		(51,939)

End of year		2,717,249		1,611,460		80,752		55,832		483,390		4,948,683


Net book value at December 31, 2017	$	2,327,863	$	1,118,175	$	10,065	$	98,899	$	636,890	$	4,191,892

At December 31, 2016


	Land		Plant		Furniture				Exploration
	and		and		and		Under		and
	buildings		equipment		fixtures		construction		evaluation		Total


Cost
Beginning of year	$	4,862,160	$	2,528,488	$	121,299	$	512,301	$	1,147,100	$	9,171,348
Additions		25,821		29,231		9,355		150,343		2,158		216,908
Transfers		168,784		126,871		3,410		(305,944)		6,879		-
Change in reclamation provision		(23,124)		-		-		-		-		(23,124)
Disposals		(27,311)		(34,611)		(38,233)		(15,490)		-		(115,645)
Effect of movements in exchange rates		(26,841)		(9,436)		(663)		(870)		(35,496)		(73,306)

End of year		4,979,489		2,640,543		95,168		340,340		1,120,641		9,176,181


Accumulated depreciation and impairment
Beginning of year		2,226,202		1,353,308		110,444		88,681		164,553		3,943,188
Depreciation charge		196,564		129,892		6,957		-		198		333,611
Transfers		27,101		(26,770)		(331)		-		-		-
Disposals		(21,736)		(19,794)		(37,981)		(10,603)		-		(90,114)
Impairment charge^(d)(e)		97,152		28,677		2,011		2,596		231,553		361,989
Effect of movements in exchange rates		(17,071)		(4,360)		(508)		-		(6,140)		(28,079)

End of year		2,508,212		1,460,953		80,592		80,674		390,164		4,520,595


Net book value at December 31, 2016	$	2,471,277	$	1,179,590	$	14,576	$	259,666	$	730,477	$	4,655,586

Cameco has contractual capital commitments of approximately $23,000,000 at December 31, 2017. Certain of the contractual commitments may contain cancellation clauses, however the Company discloses the commitments based on management’s intent to fulfill the contract. The majority of this amount is expected to be incurred in 2018.

(a) During 2017, revenues of $29,305,000 from the sales of inventories before the commencement of commercial production of JV Inkai Block 3 are recorded as a reduction of the respective mining assets.

(b) In the fourth quarter of 2017, all remaining proven and probable reserves of our US operations were reclassified to resources, indicating that the mineable remaining pounds of U₃O₈no longer have demonstrated economic viability, but have reasonable prospects for economic extraction. In accordance with the provisions of IAS 36, Impairment of Assets, Cameco considered this to be an indicator that the assets of the two cash generating units in the US could potentially be impaired and accordingly, we were required to estimate the recoverable amount of these assets.

An impairment charge of $184,448,000 ($144,450,000 (USD)) was recognized as part of the uranium segment. The amount of the charge was determined as the excess of the carrying value over the recoverable amount which was based on a fair value less costs to sell model and categorized as a non-recurring level 3 fair value measurement. The recoverable amount was determined to be $133,228,000 ($106,200,000 (USD)) based on the fair value of resources in place using comparable market metrics.

(c) Also in the fourth quarter of 2017, Cameco announced the planned temporary suspension of production at the McArthur River/Key Lake operation. Due to this announcement, the Key Lake calciner project, which is part of the uranium segment and was initially undertaken to allow for an increase in annual production, was re-evaluated. As a result, the Company wrote off $55,333,000 of assets under construction on this project.

(d) In the fourth quarter of 2016, Cameco recognized a $237,621,000 impairment charge relating to Kintyre, its uranium exploration project in Australia. Due to the weakening of the uranium market and the budget decision not to commit further expenditures to the project, the Company concluded it was appropriate to recognize an impairment charge. The charge was for the full carrying value of the CGU.

(e) In the second quarter of 2016, production was suspended at our Rabbit Lake operation in northern Saskatchewan. In accordance with the provisions of IAS 36, Impairment of Assets, Cameco considered this to be an indicator that the assets of the cash generating unit could potentially be impaired and accordingly, we were required to estimate the recoverable amount of these assets.

An impairment charge of $124,368,000 was recognized as part of the uranium segment. The charge was for the full carrying value of this cash generating unit. The recoverable amount of the mine and mill was based on a fair value less costs to sell model, which incorporated the future cash flows, including care and maintenance costs, expected to be derived from the operation. It was categorized as a non-recurring level 3 fair value measurement.

The discount rate used in the fair value less costs to sell calculation was 8% and was determined based on a market participant’s incremental borrowing cost, adjusted for the marginal return that the participant would expect to use on an investment in the mine and mill. Other key assumptions included uranium price forecasts and operating and capital cost forecasts. Uranium prices applied in the calculation were based on approved internal price forecasts, which reflect management’s expectation of prices that a market participant would use. Operating and capital cost forecasts were determined based on management’s internal cost estimates.