DOW JONES NEWSWIRES

Cameco Corp. (NYSE:CCJ) (CCJ) and its partners have reached an agreement with Techsnabexport, or Tenex, on the pricing structure for the remaining term of their commercial agreement to purchase uranium derived from dismantled Russian nuclear weapons.

Cameco (NYSE:CCJ) said the agreement requires formal documentation as well as approval by the Russian and U.S. governments and by Cameco's (NYSE:CCJ) board.

As reported, Cameco (NYSE:CCJ) currently purchases about 7 million pounds of uranium annually from Tenex under a commercial agreement that ends in 2013. The purchase price that Cameco (NYSE:CCJ) pays for the uranium was negotiated in 2001, when uranium prices were much lower than they are today. The companies didn't disclose the original pricing agreement.

In October 2007 Tenex asked Cameco (NYSE:CCJ) and its two partners in the commercial agreement, AREVA (Euronext:CEI) (CEI.FR) and Nukem, to consider a new pricing structure. Cameco's (NYSE:CCJ) stock dropped 3.7% on the news.

Cameco (NYSE:CCJ) said the existing volumes available to it under the commercial agreement remain the same and the new pricing structure makes no changes in the years 2008 to 2010. The new pricing structure affects about 1 million pounds available to Cameco (NYSE:CCJ) in 2011, rising to 3 million pounds in 2013. Of these amounts, about 400,000 pounds annually will be priced at US$60 a pound, escalated by inflation. The remaining affected quantities will be priced relative to the average uranium spot price on a graduated scale that takes effect at US$30 a pound, escalated by inflation.

The weekly spot uranium price as of June 9 is US$59 a pound, according to the Ux Consulting Co. LLC Web site.

Cameco (NYSE:CCJ) closed at C$38.63 Thursday.

-Tara Zachariah; 416-306-2100; AskNewswires@dowjones.com

    (END) Dow Jones Newswires   06-11-08 1842   Copyright (c) 2008 Dow Jones & Company, Inc.