Bob Lillie - Manager of Investor Relations Gerry Grandey - President and CEO Kim Goheen - SVP and CFO George Assie - SVP, Marketing and Business Development Tim Gitzel - SVP and COO Alice Wong - VP of Investor, Corporate and Government Relations

Terence Ortslan - TSO and Associates Greg Barnes - TD Newcrest Fadi Shadid - Friedman, Billings, Ramsey Orest Wowkodaw - Canaccord Borden Putnam - Eastbourne Capital [Ralph Pearce] - Serco Investments Ian Howat - National Bank Financial Jack Akin - Private Investor Jeff Coviello - Duquesne Capital Lawrence Smith - Blackmont Capital Brian MacArthur - UBS Xavier Majic - Passport Capital Robert Sennott - Private Investor Murray Lyons - Saskatoon Star Chris Donville - Bloomberg News [Robert Hard] - [Newcam] Fraser Phillips - RBC Capital Markets

Good morning ladies and gentlemen. Welcome to the Cameco Corporation fourth quarter results conference call. I would now like to turn the meeting over to Mr. Bob Lillie, Manager - Investor Relations. Please go ahead, Mr. Lillie.

Thank you, operator. Good morning everyone. Welcome to Cameco's fourth quarter conference call to discuss the financial results. Thanks for joining us. We're pleased to have four of Cameco's senior executives with us today. They are Gerry Grandey, President and Chief Executive Officer; Kim Goheen, the Senior Vice President of Finance and CFO; George Assie, our Senior Vice President, Marketing and Business Development. And joining us on the call for the first time is Tim Gitzel, Senior Vice President and Chief Operating Officer. Also, with us today is our colleague, Alice Wong, Vice President of Investor, Corporate and Government Relations. We're conscious of everyone's time today. So we'll touch on the highlights of the quarter and the year, including a few comments on Cigar Lake, and then get right to your questions. Today's conference call is open to all members of the investment community and the media. During the question-and-answer session, we will take questions from the investment community first, followed by questions from the media. Please note that statements made during this conference call by the Company regarding its objectives, projections, estimates, expectations or predictions may be forward-looking statements within the meaning of applicable securities laws and regulations. The Company cautions that such statements involve risk and uncertainty and that actual results may differ from those expressed or implied. Important risk factors are outlined in the Company's annual information form, dated March 17th 2006. With that, I will turn the call over to Gerry.

Hey, Bob, thank you very much. And I'd like to add my welcome to everyone on the conference call this morning. I'm particularly pleased to have Tim Gitzel joining us on the call today. He's been on the job now for about one month. But even so he is a familiar face to many of us at Cameco from his time at AREVA. AREVA, you may know, is a joint venture partner of ours in a number of Northern Saskatchewan mining operations. He's completed his move from France where he was recently AREVA's Executive Vice President, Mining Business Unit, and is now leading our operations team. I'll have Tim give us a little update here in a few moments. Terry Rogers, who was our Chief Operating Officer for the last several years, had planned to retire at the beginning of this year. We're pleased that he's agreed to remain with Cameco for the next few months in order to provide executive oversight to the remediation work underway at Cigar Lake. Last evening, we issued our financial results for the fourth quarter and the yearend results for 2006. It's particularly gratifying to announce another record setting year for Cameco, with new records for revenue, earnings and cash flow. This performance is an appropriate reflection of the confidence we share in our company and the future of the nuclear industry. Kim will discuss his results in more detail in a moment, including the specific results of the fourth quarter. During the last few months, a significant amount of our attention has been focused on the Cigar Lake project. I report that we're making steady progress in our remediation efforts, and barring unforeseen developments, we expects to complete the work required to see a lot of the inflow in the second quarter of 2007. Cigar Lake is an extremely valuable deposit that will play a pivotal role in Cameco's future. The importance of Cigar Lake drives a lot of investor interest and at times speculation. Hence, we will continue to provide updates on the remediation, with the next scheduled update to be issued around March 1st of this year. In the subsequent update after the completion of the technical report in late March, we will provide preliminary capital cost estimates and an estimated time for production startup, as we've previously announced. While we work on Cigar Lake, the uranium production for our existing operations ensures that we remain the largest producer in the world, and we are planning for the future production increases as well. We expect to start production at the Inkai project in Kazakhstan late this year. We are working to increase our US ISL production. Efforts continue to get approval to increase McArthur River and Key Lake productions. And of course, we'll bring Cigar Lake on stream. And while these initiatives are underway, our exploration program continues. And it continues from the leadership position that we've carefully constructed over the past many years. We're increasing uranium exploration expenditures from $32 million last year to $45 million this year. We're focusing our exploration efforts in Northern Saskatchewan, the Northwest Territories, Nunavut as well as Australia. And we're also active in the United States, Mongolia and Africa. In the past quarters, I've drawn attention to the operating performance of Bruce Power, and it continues to be notable. The Bruce B reactors achieved a capacity factor of 91% during 2006, up from 79% during the previous year. During the fourth quarter, two of the Bruce B reactors operated at 99% capacity and unit 6 at 100%, placing them all among the industry's top performing reactors. Market fundamentals for uranium continued to strengthen in 2006. The spot market price nearly doubled during the year. And it is expected that demand will remain strong in 2007. Supply will remain tight, sustaining upward pressure on the price and further enhancing our financial performance. George will comment on the market and our marketing activities a little later. Cameco entered 2007 with strong cash flow and a solid balance sheet. In the year ahead, we anticipate further strengthening of our company with increased revenue in each of our business segments. We continue to see growing support of our industry around the world. The nuclear industry is indeed gathering momentum. Progress continues toward construction of a new generation of US reactors, with planning underway for up to 35 new units. Both China and Russia are accelerating their construction programs. Importantly, the US and other countries are now moving to include India in the world nuclear community providing a new market for uranium suppliers. These are exciting times for the nuclear industry. And I can tell you in the 30 years I've been in this industry, I've never been more optimistic about the future. Cameco is well positioned to take advantage of emerging opportunities, and we intend to do so. I'll now ask Kim to comment on our financial results. Kim?

Thanks, Gerry, and good morning to you all. Today, I'll review the quarter and the year, have some comments on the outlook for 2007, and then close with a note on our financial position. Fourth quarter earnings were down from the same period in 2005 with three points to focus on. Notably, uranium deliveries were lower in the quarter, as we expected. And in Ontario, more moderate temperatures led to lower spot prices for power and weaker earnings at Bruce Power. In addition, we took a $20 million pre-tax charge at Cigar Lake for ongoing remediation work and to write down equipment lost in the mine. Looking back over 2006, as Gerry mentioned, we achieved a number of records including revenue, earnings and cash flow. Our earnings included an income tax recovery and a gain on the sale of a non-core asset. However, these aside, adjusted earnings were still at record levels reflecting the favorable pricing dynamics present. Recognizing and growing cash flows, we increased the dividend late in 2006, for the fourth time in five years. We manage our financial position focused on supporting our growth strategy across the nuclear fuel cycle, but with an eye on increasing dividends to shareholders. Turning to 2007. Better realized uranium prices this year will trigger the need to pay tiered royalties to the province on the sale of Saskatchewan produced [pounds]. The bank of capital allowances currently near depletion will be replenished with Cigar Lakes' capital allowances, once production begins. At that point, our sales will again be sheltered. The timing of this process will become clearer, once the technical report is completed in late March. Rising cash flows in 2007 will help fund our capital expenditure program, which includes about $300 million in sustaining capital, including revitalization projects at the Key Lake and Rabbit Lake mills and the Port Hope conversion plans. At Cigar Lake, funding requirements to remediate the mine and resume developments will be presented in the technical report. Suffice it to say, our financial position remains very solid with an excellent credit rating and a conservative net debt to capitalization ratio of 12% at the end of 2006. Our long-run target is to keep this ratio around 25%. We're building Cameco for the long term and plan to invest significantly more in the coming years in global exploration projects, new and existing production capabilities, and in other attractive growth opportunities. We believe that by conservatively managing our financial structure, we will succeed in supporting Cameco's vision to become a dominant nuclear energy company. With that, I'll turn it over to Tim.

Well, thank you, Kim, and good morning everyone. Before we begin this morning, I'd just like to say that I'm really delighted to be back in Saskatchewan and delighted to be a part of the Cameco team. This Company is a real recognized leader in uranium mining and processing, and that the assets experience envision to become even more successful in the future. I am gratified by the warm welcome I've received, and I'm certainly looking forward to contributing to Cameco's success. So turning to operations, I am pleased to report that we are making good progress on our preferred remediation plan for the Cigar Lake project. As you know, we're currently working to seal the source of the water inflow from the surface. Since overcoming some initial problems, drilling from surface is now proceeding smoothly. In total, we've completed eight of fourteen required holes for the remediation program. We've completed the four holes required to pour concrete to reinforce a nearby tunnel, below and east of the inflow area. We've already poured 300 cubic meters in this area, and are encouraged by the results. The concrete is building up from the floor in layers as anticipated. To complete the reinforcement of the ramp, we estimate we'll have to pour about 1,000 cubic meters of cement. Over the area of the rock fall inflow, we've completed four of the ten holes planned. Two rigs are now working in this area. One is drilling an observation hole that will allow us to lower a camera into the tunnel to monitor the activity. We're now able to complete a hole in about 10 to 12 days, and are hitting our drilling targets precisely. To create the plug in the development tunnel on the 465 meter level will require about 650 cubic meters of cement. Filling the void where the rock fall occurred will require about 900 cubic meters of a thin mixture of cement to squeeze in as much as possible. We anticipate that ceiling of the inflow area should be completed in the second quarter. We hope to begin work on drilling the de-watering holes down to the lowest point of the mine working this month. These holes are larger diameter, so we will have to acquire some more experience in order to provide reliable time estimates, but we know it will take substantially longer. The drilling equipment and crews have been sourced. Once these de-watering holes are complete, we will lower submersible pumps, each with capacity to move 250 cubic meters of water per hour. Required approvals for this stage of the work are not yet in place. Finally, as Gerry mentioned, we will continue to provide regular updates on our progress. Turning now to our other operations, we were very close to our production targets for 2006 and made significant progress on many fronts. At McArthur River, the licensed annual production limit was reached 10 days before yearend. The progress of freeze-hole drilling for two new mining areas has improved since the third quarter, but technical challenges related to drilling through frozen ground continues to slow us down. In October, we started on a path toward revitalization of the Key Lake mill. This project will apply new technology to the process to simplify operation and increase capacity. In November, we concluded a new collective agreement with our unionized workers at McArthur River and Key Lake assuring labor stability at our largest production center through the end of 2009. Fourth quarter production at Rabbit Lake was less than expected, but our reserves replacement program continues to produce encouraging results. New estimates have been calculated and we have sufficient order to produce until 2011. We're optimistic that we may be able to reclassify some of the resources to reserves and add production in the latter years. Our ISL operations in the US achieved record production in 2006 exceeding their targets. Smith Ranch-Highland produced 2 million pounds of our ISL production in 2006, which is the highest production achieved in the history of ISL mining in the US. Our Inkai project in Kazakhstan progressed steadily toward production during 2006. Construction of commercial processing facilities is underway with commissioning expected this year and commercial production in 2008. The Blind River uranium refinery also achieved record production in 2006 to meet the requirements of the Port Hope and Springfields conversion facilities. We're also seeing positive results at Port Hope. UF6 production was short of target for the year due to difficulties in fluorine generation, but the plant had a solid fourth quarter and achieved record production in January. Our Zircatec fuel manufacturing operation acquired in February 2006 fell just short of its 11-month production target. Integration into the Cameco group of companies has been smooth and we expect to make up the shortfall early in 2007. So with that, I'll turn it over to George.

Thanks, Tim. And good morning, everyone. Spot market activity in the fourth quarter amounted to about 5 million pounds, bringing the latest estimate for 2006 to 32 million pounds. And by the time additional transactions are confirmed over the next several weeks, we expect that to rise by another 2 or 3 million pounds, which would put it at a very near the same level of 36 million pounds contracted in 2005. Discretionary purchases and those are purchases not used to fill actual near-term fuel needs accounted for 73% of total transactions on the spot market last year. And that's a record level and an increase from 2005 when discretionary purchases accounted for 66% of spot volumes. Utilities and investment groups accounted for about 50% of spot volumes, as utilities continued to build inventory and investment groups continued to take positions in the rising market. Over 80% of spot transactions occurred off market, as buyers stayed away from public request for quotes in order to avoid increasing visible demand and driving prices up more quickly. About half of the 2006 on-market activity was sold by an auction, and those auctions were important in adding significantly to market transparency. Industry average spot price at quarter end was $72, and that's 30% higher than it was at the end of the third quarter, and about double from a year ago. Spot price increased in every month of 2006, with the largest increase coming in, in December, when it increased by 13%. The first several weeks of 2007, it seems that spot price remained flat at $72. This plateau was a result of unwillingness on the part of spot sellers to offer fixed prices. With the expectation that spot prices are still under considerable upward pressure, sellers have been reluctant to commit to a fixed price, which would have them leaving the money on the table. Now, last week, the spot price resumed its upper trend and now stands at $75. Moving to the long-term market, the average long-term price indicator at the end of the fourth quarter was also $72, about double that of year-end 2005. And as in the case of spot price, long-term price has moved up since then this year and also stands at $75. As was the case with spot offers, sellers were reluctant to offer base escalated pricing under term contract fearing that they would miss upward momentum in the market. I doubted there were many, if any, pure base escalated offers made during 2006. For the most part, reported long-term price was based on offers, where the seller was willing to fix a small percentage of the price going forward, generally something less than 25%, with the remainder of the price being market related. The current estimate for term contracting in 2006 is about 210 million pounds, that may yet increase by another 5 million pounds or 10 million pounds as additional transactions are identified. So while it was lower than the 250 million pounds contracted in 2005, it was still a very active year when compared to pre-2005 levels. Now, high level of contracting volumes can partially be attributed to the longer contract terms in excess of 10 years, and that was also the case in 2005. For 2007, we expect another very active year in the long-term market. I'd now like to comment on Cigar Lake, as it relates to our customers. As noted in the Q4 MD&A chemical at unplanned supply interruption language and a possibly three quarter of our current contract. And of course, the other contract the legacy contract do have forth mature provisions in them. The Unplanned supply interruption language allows us to reduce, defer, or cancel volumes pro rata in the event of a disruption in planned supply. So since that event, our marketing team has met personally with each customer that is potentially affected by the disruption in planned supply to explain the potential impact to their delivery bulk volumes both near-term and potentially longer term. Today, we are really focused only on deliveries originally scheduled for 2007. And for the most part, we are looking to defer the affected quantities by a period of five to seven years, and in a few cases longer than that. We are extremely pleased with response of our customer to disruption in our planned supply and to our half occasion of the unplanned supply interruption provisions under contracts. And we thank our customers for their support and corporation in this regard. Turning now with UF6 Conversion Market at year-end, the North American spot conversion price increased to $11.75, and the European spot conversion price increased to $12.38. Now, in the month of January this year, the North American spot conversion price weakened slightly to $11.63, and the European price decreased to $11.15. Reason for the price weakness is that a holder of UF6 was looking to break the UF6 down into its component parts. And in fact, re-converting the UF6 to as to be better. So as to be better positioned to be of only with the U3O8 component. UF6 conversion component was then placed into the market at a time of low demand. At this time, we do not think that this spot price weakness in the conversion market is part of a longer term trend. In the long-term market at year-end, the industry average price to North American conversion held at $12.25 and for European conversion increased to $13.75. So far in 2007, that long-term price in North America has remained at $12.25 and the European conversion price has dipped only slightly to $13.50. So that concludes my remarks and with that back to you Gerry.

Okay. George, thank you very much. And operator we w ill turn it over to question from the investors we have any.

Thank you. We will now take questions from the telephones lines. Please be advised that we will take questions from the investment community first, followed by questions from the media. If you are something investment community and you have a question [Operator Instructions]. The first investment question is from Terence Ortslan from TSO and Associates.

Thanks. We are pleased to hear that McArthur is bumping against the permitted limit. Where are we with respect to the issues of trying to expand McArthur permitting lines and also engineering life and any progress would be none in the quarter and progress plan for the 2007 period. Thanks.

Terry, if you recall that we were bumping up against an environmental issue with our regulator. And we've proposed a solution to the selenium, molybdenum issues that we've discussed in prior conference calls. That is now under consideration by the regulator. We expect I think a decision here in the next little while. We believe we've offered a solution to resolve the problem. And then and then we'll be able to once again commence the licensing amendment process to increase production. It isn't going to happen quickly. It's not going to happen in 2007. But, you know, we're hoping it will be 2008. Once we get a approval, there will be then a ramp-up period. We won't step into increase production immediately. Terence Ortslan - TSO and Associates: But this in specifically took about more then a year some times two, three years, which is like to be a licensing issues?

You're absolutely correct. Terence Ortslan - TSO and Associates: Why would it be different this time, Gerry? Because as you got your presidential history.

Well, you know, there are lot of – there's a lot of background work that's been done. We're hoping that we can just take advantage of that. Terence Ortslan - TSO and Associates: So the earlier if we can see McArthur being able to do more tonnage or more pounds it will be 2009 or '10 period?

Well we've, you know, we've ramp-up. So we're going to try to do a little bit better then that. But we're not going to increase from 18.7 to 21 or 22 in strenuously. Terence Ortslan - TSO and Associates: Okay. Next question is with respect to your progress in Cigar Lake. Could you just elaborate upon how – co-visible homogenous the approach is today as earlier – would have different views about the whole engineering and structuring aspect of Cigar Lake issues? Or are you working on any of the joint program by the independence are taken over?

No. You know, it is – it is a joint venture. And we have a steering committee. So with every facet of what we do in terms of remediation plan, is bedded with that steering community – committee here I would say that thus far there's been unanimity. And the approach that we're taking there really has to be – lot of ideas contributed. But we're all coming down under preferred solution here quite – quite well. Terence Ortslan - TSO and Associates: Okay. And George, are they doing the same as you have with respect to the customers on Cigar?

I'm really – I don't believe they have the same sort of language in there contracts that we have in ours. So beyond that I'm just not able to comment. Terence Ortslan - TSO and Associates: Okay. Thank you very much.

Thanks, Terry.

Thank you. The following question is from Greg Barnes from TD Newcrest. Please go head. Greg Barnes - TD Newcrest: Thank you. George, just wondering the wording about the fairing delivery for 5 to 7 years with the supply interruption clauses that you have in the contracts. Why so long?

Well, we wanted to move it out far enough to allow us to – give away the impact wise and given you know that nobody knows what the absolute certainty to when Cigar Lake will start etcetera. We want to put it out into a time frame when we're very comfortable that it would not impact our portfolio unnecessarily. So we have the right to terminate those deliveries instead, we chose to say look we'll, to further mount that five to seven year period and deliver it then. We thought that was a reasonable compromise for us and frankly our customers have seen it that way as well. Greg Barnes - TD Newcrest: So we instead of saying you that it needs to be a realistic timeframe for you to get -- to go like backup and running?

Well, I wouldn't read that into it.

No. We wanted to simply push it out far enough, so that we didn't see how up it's going to be a factor. The last thing in the world we wanted to do was, take any chance that we're going to defer it, and then have to go back and defer again, and you know, that sort of things. We want to push it out a long way and so that it wouldn't be an issue. Greg Barnes - TD Newcrest: Okay. Just a follow-on, you both have said in the release that you may terminate a portion of uranium loan arrangements in 2007. It seems to be a calendar argument for five to seven year delay of Cigar. So are you more comfortable with your uranium supply position there?

That's why I wouldn't read anything into the five to seven years in terms of our expectations for Cigar. We're certainly looking at the loan agreements to see whether we need keep it in place. And that would be under consideration during the course of the year. Greg Barnes - TD Newcrest: Yes. And just quickly the last question. On to get royalty on Saskatchewan that's getting here in 2007. Is that based on your realized price or the market price or on sales volume, how does it work?

It's driven by realized price grade. Greg Barnes - TD Newcrest: By your realized price?

That's correct. Greg Barnes - TD Newcrest: In Canadian dollars?

Yes. Greg Barnes - TD Newcrest: Could you provide us, do you clear us where it kicks in?

Yes. I can get you those later roughly, in fact now, the first level is that they push tiered royalty 60 and a $16 Canadian, a pound and it's an incremental 6%. And then moves up to $24 from the next tier and $32 to tier after that. And probably the tier -- the middle one there is an incremental 4% and the last ones is an incremental 5%. Greg Barnes - TD Newcrest: And that incremental is on top of the based royalty of --

-- of 4% net, yes. Greg Barnes - TD Newcrest: 4% net. So above $32, you pay a 9% royalty?

No. The cumulative would be a 19% royalty on the above $32 component. Greg Barnes - TD Newcrest: 19%.

Cumulative. Yes. So it goes 4%, first six cumulative 10, cumulative 15 on increments above each level. Greg Barnes - TD Newcrest: So then above $32 you're paying about $8, you're paying a $6 for a P2, to Saskatchewan government?

Exactly. Greg Barnes - TD Newcrest: Okay. Thank you.

Thank you. Our next question is from Fadi Shadid from Friedman, Billings, Ramsey. Please go ahead. Fadi Shadid - Friedman, Billings, Ramsey: Yeah. Thank you. More on the product loan facilities. Is there more visibility now? From the time those were setup in terms of things will play out, in terms of production? Especially in a view of maybe more visibility from Rabbit Lake?

Necessarily if time goes on, Fadi, I think we get increasing comfort Rabbit Lake is certainly a factor in that. You know, we have great confidence in the fact Cigar Lake is going to come back and we'll know better the timing in a month or two. All of those factors, as you might expect go into judgment of that we need those product loan arrangements likewise just dealing with our customers in terms of flexibility that we have and that they have is in considering too. Fadi Shadid - Friedman, Billings, Ramsey: Okay. And, generally on mining cost, you talked about a 20% year-over-year rise is well, of course, it that -- do you think that will continue beyond this year or, you know, what's the major component there, is it the royalties or?

Fadi, that was not just mining cost that was the cost to sales, which will include purchases -- Fadi Shadid - Friedman, Billings, Ramsey: Okay.

So that all in cumulative cost of good sold number, which will include purchase material, royalties as move higher actually of all the components driving that, mining costs in sales are the smallest piece. Fadi Shadid - Friedman, Billings, Ramsey: Okay. Okay. Good.

Fadi, I think we've done a pretty good job of controlling mining cost. Fadi Shadid - Friedman, Billings, Ramsey: Okay. Okay.

And I just wanted to add one quick point, back to Greg's comment on tiered royalties draw on the call. In 2007, those royalties are fully tax deductible, which will be the first year for that. Just to add that point for you, Greg. Fadi Shadid - Friedman, Billings, Ramsey: Thank you.

Thank you. Our next question is from Orest Wowkodaw from Canaccord. Please go ahead. Orest Wowkodaw - Canaccord: Yes. Two questions, if I may. Do you have a sense of what sort of capital, you'll be looking for to expand McArthur River? And secondly, you gave us a nice chart in Q3 that outlined what you expected price realizations at uranium, given certain spot pricing. I'm wondering has that changed material, now that you've deferred the Cigar Lake contracts?

Do you want to take last one first?

Last one first.

There would be some slight changes there, in particular in respect of '07, and that chart will likely appear I think, next quarter? Is that right Alice?

Yes.

So -- but I think for now, I think if you use what we reported last quarter that would be the appropriate thing to do. Orest Wowkodaw - Canaccord: Okay. But we won't get an update until next quarter?

That's right. Orest Wowkodaw - Canaccord: Okay.

And we'll see if we can get a specific figure, we may – we may not be able to, Orest. But on McArthur River, it isn't going to be all that much frankly, and it is going to be a lot of reinvestment done overtime in Key Lake. But expanding McArthur River production overtime isn't going to be all of that much money just, you know, little bit more timely and little bit more raise boring. But the machines – did the job pretty well and actually finished as we said earlier finish the year early producing 18.7000 as it is. Orest Wowkodaw - Canaccord: Okay. Thank you.

Thank you. Our next question is from Borden Putnam from Eastbourne Capital. Please go ahead. Borden Putnam - Eastbourne Capital: Good morning. Couple of questions for Tim Gitzel, if I could. Tim you're moving a little fast in the first part of your presentation. I wasn't quite ready. And you talked about 1000 meters of cement going into the reinforcement area. I'm looking at a diagram that chemical used in there discussions with CNSC during late October. I'm trying to understand where the reinforcement area is relative to the inflow area?

There is a ramp that goes up from the 480 level to the 465 level that comes within about 5 or 6 meters from the area where the rock fall occurred. Borden Putnam - Eastbourne Capital: Okay.

So before we dewater and pressurize up that area. We want to make sure that tunnel is plugged solid that is not going to breakthrough or something into the area, that where the ramp area, that we're filling. So we're going to fill that first and then we'll move up into the fall area. Borden Putnam - Eastbourne Capital: And how far is that from the inflow area?

I think there's about 5.5 meters of solid rock between the two. Borden Putnam - Eastbourne Capital: I see. So it's actually separate area from the main drift?

It's a ramp that we no longer use. Borden Putnam - Eastbourne Capital: Okay. So, but it is connected right now and you're going to try to block it off, is that, I'm confused?

It's just – its 5 meters below and to the east of the area where the rock fall occurred. So it's – there just 5 meters of basement rock between the two. And it's really a precautionary measure on our part that we think that's close. So we want to really plug that ramp area up, make sure it's solid in there, before we start grouting and pressurizing -- the pressure grouting the area where the rock fall occurred. So it's really a precautionary measure on our part. Borden Putnam - Eastbourne Capital: But it is a separate area. It's not physically presently connected this is the --

-- not physically connected. No, it's a unused ramp. Borden Putnam - Eastbourne Capital: I see. And looking at the cross section I think, I see where you speaking of. All right. And you said there was 650 meters of cement needed for the inflow area and another 900 meters or you mentioned a slightly lower viscosity more liquid as a grout?

So – we'll put the 650 cubic meters and to create the plug. And we'll put that a little bit back few meters back from where the rock fall occurred and try and create that plug-in, plug it off. Then you've got a mound of the fallen material in there then we want to put the 900 cubes in there. And it's a different it's not real cement like you pour your dry cement it's a later material, but goes up into the cracks it's a growing type material that we can pressure we can pressure growth and it'll seal the cracks and really solidify that area. So that's the difference between the two. Borden Putnam - Eastbourne Capital: Interesting. I am running in my own estimate is little over 2000 cubic meters, so I'll be interested to see how much you require, I'll try to rough it out from these survey diagrams you shared with us. Moving McArthur for a second if you speak about this slow drilling for the future mining zones, which zones are impacted by this?

Well, some of these Zone 2 areas that we're going to be moving into it's we're drilling through some of the previously frozen grounds, so that's taking us a little bit longer, it's a little bit more complicated so that's where we are now. Borden Putnam - Eastbourne Capital: Is that what you call Zone 2 remnant or the Panel 5?

We're moving towards the Panel 5. Borden Putnam - Eastbourne Capital: Okay.

I'm very apologize and not sure, if I know the terminology on remnants. Borden Putnam - Eastbourne Capital: It's from you or it's from Cameco's product description proposing the CEASR for the expansion of McArthur River, Key Lake in late November 2004 and 2005 and it uses those terms I'm not very clear where they are either, I'll try to get a map, which shows where they are, but I mean Zone 2 remnant --

Left over so far from the mining operations. Borden Putnam - Eastbourne Capital: Okay. Yes. Looks to be important later, but back on Zone 4 that you speak about that the upper Zone 4 is starting in 2012 with the boxhole boring, when the Zone 4 lower come into the mine plant?

I don't have that information in front of me right now. I apologize. Borden Putnam - Eastbourne Capital: And, I guess Terry is not in the room -- not that you couldn't answered if he was there, I was just curious. But the mining method for Zone 4 lower, is that also boxhole boring?

Mostly boxhole boring. So that will be, I believe, the raiseboring whether raiseboring. Borden Putnam - Eastbourne Capital: Okay. Is that -- I know, Gerry, you and I talked about doesn't looks like, that's suppose to come in 2007 at a little bit of tonnage maybe late in the year and then ramping up to sort of 6 million pounds in 2008. Is that's --

Well, we'll get back to you on that, I frankly, don't have the -- I think there might be a little bit early though from my recollection. Borden Putnam - Eastbourne Capital: Okay. I think the last thing I got is on the -- have you actually used the boxhole boring method as that you progress planning of this method McArthur River and that boxhole boring is to be delivered in early 2008. How much actual mining with the boxhole method have you done in McArthur River?

We haven't applied the boxhole methods yet at McArthur, that will be in the work so that in the next few years. Borden Putnam - Eastbourne Capital: Okay. On the 7 million pounds you buy a year for the HEU agreement, Gerald, you want to talk about this and you're out here and I apologize it. How much does that price escalate was reflecting or to -- how much does it reflect the spot price at the time of the purchases. As you move -- you see you talked about you got 7 million pounds in trenches 2007 to 2011. What are the costs does that look like?

Well, the cost off course is somewhat confidential -- we all imagine there is no describe it. Borden Putnam - Eastbourne Capital: Okay. And this just -- this is non-material that you -- that involves your long term contracts in anyway?

No. We deliver into our long term contracts, like we do all of our other productions of Cameco. So it simply gets delivered to our customers under existing long term contracts.

Yes. Borden Putnam - Eastbourne Capital: All right. I probably didn't phrase a write up. I'll try to re-phrase and get back. Thanks. Appreciate it.

Yes.

Thank you. The next question is from [Ralph Pearce] from Serco Investments. Please go ahead. Ralph Pearce - Serco Investments: Good morning I have two questions. The first is once you throughout in the current inflow, what are the chances of a second area of flooding and why you think there would not be a second inflow at a different stage?

As you know I think based upon what we saw before the inflow. There really isn't much of a risk of instability in other parts of the mine. But, it is underground mining operation and so you can't fully predict what's going to happen. We won't know what has the current that we get in floods often it was. But, you know, right we've got a lot of confidence in the remediation plan and program that we haven't placed well. Ralph Pearce - Serco Investments: Well, okay. Thank you. The one other question is I am concerned as you said there is five to seven years. I know you said that's pushing away out, but I think medium in investment community can launch on to that time period. And I guess the question would be at what stages the remediation, would you be able to give some day for a start with Cigar Lake?

And we're saying and I've said in the release that in the late March there will be a technical report that is going to be issued. And to the best we can, we'll answer that question. Ralph Pearce - Serco Investments: Yes. Okay. Thank you.

Thank you. The next question is from Ian Howat from National Bank Financial. Please go ahead. Ian Howat - National Bank Financial: Good morning. Just a couple of questions. How come production is falling off. It's mismatched in 2007, is the first question.

It's more a function of just move to different wellfields in productions, kind of the development schedule and the movement to other wellfields and probably a function 10 of the grade --

Yes, the grade is down a bit. Ian Howat - National Bank Financial: And I can see you just got approval for grouping Reynolds Ranch with all that. Is that correct?

Reynolds Ranch, yes, it is fitting into the plans. And I'm not sure of the approval you're referring to. Ian Howat - National Bank Financial: All right. I guess that was related to somewhere else. With regards to Rabbit Lake and your production profile, is that sort of conservative to tell on whether you convert those others [past] reserves.

I hope so. Ian Howat - National Bank Financial: Okay. And then the deferred pound you're pushing always with Cigar Lake, those have been all the base price contracts. Has there been any change in the pricing mechanism for those that are being deferred and pushed out?

No. Ian Howat - National Bank Financial: No? Tim, is that true?

You heard it correctly. Ian Howat - National Bank Financial: Okay. He said no. Okay. Thank you.

Thank you. Our next question is from Jack Akin, a private investor. Please go ahead. Jack Akin - Private Investor: Yes. Your gold company that you're involved with, I think you said for 2007, but that's going to -- you can be ramping up production in that and doing more sales?

Could you repeat the question, Jack? Jack Akin - Private Investor: Yes. You know, the gold company that you are a partner of --?

Yes, we own 53% of the Centerra, yes. Jack Akin - Private Investor: Right. I believe you said that in 2007, you're going to be increasing production about 20%.

Production will increase over 2006 -- in 2007, because in 2006 the production was affected by the Pit Wall slide in July. So we didn't meet budgeted production in 2006. Hence, when you look year-over-year production, yes, it will increase. Jack Akin - Private Investor: And do you have an overall price for your uranium for 2007. But did you have like to have with all your uranium sales? Is it a $20 price or $30 price, your overall price or you don't have that?

We've said around $30 dollars, but it will come out in the next release, the quarterly release that we do. And we'll give you the same kind of the table we gave you last year. Jack Akin - Private Investor: I see. And going forward, is that price going to increase dramatically, like when does it catch up to --?

Right. Jack Akin - Private Investor: And when is that out again?

I think that was --

We're working at after in the second quarter, because of the launch of CDS, the impact of what happened to Cigar Lake supply interruption contract. So we need to factor that in. We're not quite sure. We're still in discussion. So we are not quite sure. We exactly want to make sure we have the most acrid prices at that time.

So in the meantime, Jack, you have, what we released last year, which will kind of give you an idea of year-over-year increases. And it will get -- as George indicated, it will get adjusted in the next release, which will be in the second quarter. Jack Akin - Private Investor: But obviously, it'll be adjusted upwards?

Well, the spot price has gone up, so -- Jack Akin - Private Investor: Yeah. Okay. Thank you very much.

Thank you.

Our next question is from Jeff Coviello from Duquesne Capital. Please go ahead. Jeff Coviello - Duquesne Capital: My question was answered already. Thank you.

Thank you.

Okay. Thank you.

The following question is from Lawrence Smith from Blackmont Capital. Please go ahead. Lawrence Smith - Blackmont Capital: Good morning. Another question on the deferrals of contracts. I was reading the release. I don't see any what you mentioned. The volume of sales has been affected by the deferrals. And if you could also clarify, you mentioned sort of two sets of deferrals. One relates to the Cigar Lake baseload contracts. I think you're deferring to the end of the contract life. And the second relates to sort of other. Could you just explain what the distinction is? And also, I hate to ask a supplementary question to Ian Howat. Do I understand correctly, we deferred to the end of the contract if it was a fixed-price affects by contract, the $30 a pound? Does that mean that $30 price is pushed out to the end of the contract? Thank you.

Okay. Well, I'll answer the last one first. First, in terms of the price, the pricing mechanism that exists in the contract is it remains in there until the deferred deliveries is made. So it's market-related. It will be market at the time of delivery. If it's a fixed-price contract, then it would continue to escalate based upon the escalator used, which as I indicated in the past is most often the GDPIPD. So you know, that price will escalate over time and be whatever it is in years five to seven. And then in terms of the volumes under the contracts, we have not released information in terms of the volumes. And frankly, as I indicated in my notes, in my remarks, we continue to work with our customers on the situation. We think we have a pretty good idea about how it's going to all come out, but those negotiations are not finally at end. So we haven't released any of that information on volume. Lawrence Smith - Blackmont Capital: Sorry, George, just again, the distinction between the deferral in the Cigar Lake baseload contracts, is a distinction that those were going to the end of the contract. Was that presumably the longer-time period than the five to seven-year deferral on the others? Is that the distinction you're making there?

That is true. Lawrence Smith - Blackmont Capital: All right. Thank you very much.

You're welcome.

Thank you. Our next question is from Brian MacArthur from UBS. Please go ahead. Brian MacArthur - UBS: Sorry to ask the same sort of questions, maybe another following up on Ian and Larry's question. When you defer the Cigar material, you mentioned like 2007 is going to be an impact on that table. But if we also -- without telling us, obviously, the volumes -- have you deferred like '08 and '09 material as well? The reason for that is, you know, in '09, in the original chart, you had the big fall in realized prices due to the mix of contracts and the way they came in. Is that all being restructured so that may not be the case going forward, can you comment on that?

Yes. It works, Brian, is that we're focusing on impact in 2007 today. That's where the discussions and negotiations are -- or should we say discussions of work is ongoing with our customers. In respect of what the impacts might be in '08 and beyond, we're looking at that to give some guidance with them as we discuss it. But the fact is, today, we don't know exactly what it will be. You know, Rabbit could produce more. It depends on what happens with the other production centers. So the entire focus of our discussions for the most part is on the 2007 impact. And that's what will show up in that table ultimately when we get there at the end of the second quarter. Brian MacArthur - UBS: So is it fair to summarize effectively what we restructured then is just the -- whatever it was -- 3 million pounds that we're going to be delivering in 2007. Those are the ones that are pushed out five to seven years, nothing -- everything else is being negotiated right now?

That's right. For today, we're only focusing on the 2007 pounds that are impacted. We'll need to address 2008 and beyond as we get closer to that time period. Brian MacArthur - UBS: As you get more information after March -- whatever March, in March. Okay. Thanks very much.

You're welcome.

Thank you. The following question is from Xavier Majic from Passport Capital. Please go ahead. Xavier Majic - Passport Capital: Yes. I wondered if you could comment a little bit on your relationship with Kyrgyzstan government with your gold company there.

Xavier, we've for years and years and years dealt with the Kyrgyz government. And of course, it's changed periodically with some political end stability. But with each government, with each change, we've managed to establish pretty solid relations and have very candid business-like discussions to the mutual advantage of both parties. So we have a new Prime Minister. The President, of course, has been there for a while. The new Prime Minister we have yet to meet with since he is only been on the job for about a week. But we intend to do so here in the next little while and talk about the issues that frankly have been raised in past years and will probably be raised again and again and again as time goes on. So -- but we worked very well with the Kyrgyz government and we still find it a very good place to do business. Xavier Majic - Passport Capital: And you -- would it be out of the realm of possibilities to look for uranium in Kyrgyzstan?

You know they did historically produce uranium from my recollection. I mean I was there years ago looking at some of the operations. There was a very, very large uranium mill there at one point in time. In fact, I think it still exists in Karabalta. But the deposits were mostly small and you know, the economics would be somewhat just that as quoted even in today's presses. And having said that, I know there are people that are looking him. So who knows what might happen, they may become a producer in the future. Xavier Majic - Passport Capital: You have no trouble doing businesses in that country?

No. Xavier Majic - Passport Capital: Okay. Great. Thank you.

Thank you. [Operator Instructions]. Our next question is from Greg Barnes from TD Newcrest. Please go ahead. Greg Barnes - TD Newcrest: Yes. Thank you. Tim, back to your points about the tiered royalties being tax deductible?

Yes. Greg Barnes - TD Newcrest: The guidance for the tax rate in 2007 was 16% to 20%, is that inclusive of the tax ductability of the royalties?

Yes. It is. Greg Barnes - TD Newcrest: So at the end of the day, the tax ductability of the royalties were offset the bulk of the negative impact on your realized price item?

That's a pretty big. Greg, that had too many pieces in there for, maybe, just give you an absolute yes or no on. Greg Barnes - TD Newcrest: Yes. Okay. I'm sorry for that one. I guess we'll talk afterwards. Thank you.

Check out.

Thank you. Our next question is from Orest Wowkodaw from Canaccord. Please go ahead. Orest Wowkodaw - Canaccord: In terms of how many years forward are you've already secured purchase agreements for additional uranium above your production to meet your existing delivery contracts?

Well, the largest of those and the longest of those would be the HEU agreement that runs through 2013. There are some other longer term purchase arrangement that, you know, are top of my head run for at least for next several years but that -- you know on that... Orest Wowkodaw - Canaccord: What would be the earliest that you have to answer the market to make a shortfall?

We're under -- we're not in a position where we have to enter the market to make a shortfall. We managed our portfolio in such a way that we're never in a position, we have to do that. Now, we do choose as we showed in the past to always position ourselves, so that we're able to enter the market when we choose to. Orest Wowkodaw - Canaccord: Thanks very much.

You're welcome.

Thank you. Our next question is from Robert Sennott, a Private Investor. Please go ahead. Robert Sennott - Private Investor: Hi. I guess this question is for Gerry, Gerry in your press release this morning you mentioned that you're going to be exploring up in the Northwest Territories. Is there any specific site that you have in mind out there? Are you got to identified in state mining areas?

That's almost beyond my capability to answer. Robert, I apologize. But I think what are on the startles --

The Thelon

The Northwest basin and Nunavut and the Thelon. If those geographic names mean anything to you but I believe those are once that we talk about in the territories as well as in the unit.

Very good. Thank you.

You bet.

Thank you. We will now take questions from the media community. [Operator Instructions] The first media question is from Murray Lyons from the Saskatoon Star. Please go ahead. Murray Lyons - Saskatoon Star: Yes. Gentlemen if I may have a couple of Saskatchewan centric questions. The first relates to follow-on great bonds as questions about the tiered royalty. And I am wondering Mr. Grandey whether you've or what is you the lobby position of the uranium industry with regard to tiered royalties in light of the obviously challenges in mining uranium in Northern Saskatchewan, are you pushing to get a more understandable flat rate?

Greg -- Murray, I am sorry-- the whole tiered royalty regime was revisited probably about four or five years ago. Uranium industry at discussions with the government and there was a considerable change that was made at the time acceptable to the uranium industry and to the government we are now living with it and with what have seen will be a regime going forward. Murray Lyons - Saskatoon Star: But is it unique to uranium versus other natural resources.

In this products it's a unique royalty regime different than any others yes. Murray Lyons - Saskatoon Star: And my other question, I know this Cigar Lake capital cost has been tabulated or revealed yet and that will be done against in March. But I am wondering earlier last year there was an news report that you were looking at the possibility of looking at whether your head offices adequate here in Saskatoon. And I am wondering whether Cigar Lake capital demands would impact on the planning within your companies for looking at perhaps a new head office or expansion of your existing.

Well, its an interesting linkage. On that frankly, Murray and I have made. No there, is no question and then as we grow we have an issue about the head office and what we do here and that's been looked at and we'll continue to look at it as time goes on but its on linked all with what's going at Cigar Lake. Murray Lyons - Saskatoon Star: Okay. Thank you.

Thank you.

Thank you. Our next question is from Chris Donville from the Bloomberg News. Please go ahead. Chris Donville - Bloomberg News: Hi, good morning Jerry. Could you give us a quick summary of where you were trying to increase production ramp up? I'm thinking of extending reserves at Rabbit, what you're doing at Inkai and the ISL operations in the US. How significant in terms of magnitude would an increase be there so to post Cigar Lake?

Well, obviously, Inkai is now in the construction phase and should go into production by the end of the year, commercial production early 2008. And we intend to take that from where it was this year at about 800,000 pounds up to 5.2 by 2010. ISL in the US ultimately from the 2.5 -- it's around 2.8, I guess, this year, we intend to take that up to about 5 million pounds by 2010, '11, in that period of time. Our McArthur and Key, we've talked about going from 18.7 to 21, 22 over a period of time, and you could kind of use the same 2010, '11 period for that. And we have the Millennium deposits that we're doing a feasibility study on. That's in the Basin as well. And of course, Rabbit Lake, we continue to have success finding pockets of resources around the Eagle Point mine. So all in all, I think it's quite positive from a reserve replacement perspective, and in the meantime, exploration looking for the next big one. Chris Donville - Bloomberg News: There's been a lot of talk lately about how the global uranium production declined last year despite all the activity that's going on in the industry. What are your expectations for global production this year? Would you expect that it would exceed 2006 or fall back again?

No. I think it will exceed 2006. We have -- finally the increase in prices have resulted in junior exploration companies that had deposits found a number of years ago succeeding to get into production. We saw some toward the end of 2006. Others will commence production in the end of 2007. Some of the problems that the major producers encountered a year ago, which were grade and typhoons and mining conditions, you know, you can always have those because everybody is operating pretty close to capacity. But I think as time goes on there's a little bit more robustness built into the production schedules. Our expectation is that production will increase -- I'm not sure we know how much, but will increase over 2006. Chris Donville - Bloomberg News: Thank you very much.

You bet.

[Operator Instructions] Our next question is from [Robert Hard] from [Newcam]. Please go ahead. Robert Hard - Newcam: Good morning, Gerry. How are you?

Well, Robert. And you? Robert Hard - Newcam: Good. No -- I just wanted to get to back to Rabbit for one second. Now, you've mentioned that you've had some good luck in finding pockets around Eagle. In view of a possible delay in Cigar, I'm wondering whether I can count on Rabbit producing in the area 5 million or 6 million pounds for, say, until 2010-2011?

Well, Robert, you know, we can only talk about reserves that we publicly disclose and, hence, the table we disclosed is, you know, what we're saying is the production schedule for Rabbit. So when you asked the question earlier whether that was conservative, we believe it is. But it would be speculation on our part, which we do to give you any different guidance. So you'll have to throw in your own numbers. Robert Hard - Newcam: Okay. I'll fill some in. Thank you very much, Gerry.

Actually, thank you.

Thank you. Our next question is from Fraser Phillips from RBC Capital Markets. Please go ahead. Fraser Phillips - RBC Capital Markets: Thanks. Morning. Kim, could you just remind me again -- I apologize, I didn't catch the numbers -- the break points or the pricing points for the [graduated royalties], and could you tell me do those escalate?

Yes. They do escalate, Fraser, as we move, you know, and each year they are reset. Fraser Phillips - RBC Capital Markets: Yes. And it's - you said 16, 24, 32 -- is that right?

In round numbers, that's correct. Fraser Phillips - RBC Capital Markets: Okay.

16, 24, 32. Fraser Phillips - RBC Capital Markets: Thanks.

Thank you. This will conclude the questions from the telephone lines. I would now like to turn the meeting back over Mr. Gerry Grandey for his closing remarks.

Okay. Operator, thank you very much. And we'll just simply say to everybody out there, thank you for joining us today on the conference call. And we wish you a good day, and we'll go on about the Cameco business. So thank you very much. Bye-bye.

Thank you. The Cameco Corporation fourth quarter results conference call has now ended. Please disconnect your lines at this time. We thank you for participating, and have a great day.