Brian Zinchuk is editor and owner of Pipeline Online
Westinghouse AP1000 reactors at Vogtle. Cameco
Just a week after Cameco was the major sponsor for the inaugural Canadian Nuclear Association West conference in Saskatoon, the Saskatchewan uranium producer had a massive announcement furthering nuclear power generation in the United States. There are considerable implications for Saskatchewan, which last week committed to building nuclear power generation.
On Oct 28, the company announced it and Brookfield Asset Management would establish a “transformational partnership” with the United States Government to accelerate deployment of Westinghouse nuclear reactors.
Brookfield and Cameco, both Canadian companies, are 51/49 per cent owners of Westinghouse, which was the company that first developed reactors for the US Navy’s submarine fleet. It’s been a major nuclear reactor supplier since the dawn of the nuclear age, but has gone through several ownership changes, the most recent of which saw Brookfield and Cameco team up to buy the company out of bankruptcy for a small fraction of the dollars discussed in this announcement.
Here’s the Oct. 28 press release from Cameco:
Cameco Corporation (TSX: CCO; NYSE: CCJ) today announced that it, along with Brookfield Asset Management (Brookfield), has entered into a binding term sheet with the United States Department of Commerce (US Government) to establish a strategic partnership, which is expected to accelerate the global deployment of Westinghouse Electric Company’s (Westinghouse) nuclear reactor technologies and reinvigorate supply chains and the nuclear power industrial base in the US and abroad.
The agreement provides for the US Government to arrange financing and facilitate the permitting and approvals for new Westinghouse nuclear reactors to be built in the US, with an aggregate investment value of at least US$80 billion, including near-term financing of long lead time items. Once constructed, the reactors are expected to generate reliable and secure power for the American grid, including powering significant data center and compute capacity to drive growth in artificial intelligence in the United States.
“We are pleased to see the US government make this commitment to expanding nuclear power capacity using Westinghouse’s proven technology. We expect that our highly successful partnership with Brookfield as owners of Westinghouse will be further strengthened through this strategic collaboration with the US Government,” said Tim Gitzel, CEO of Cameco. “At the center of this new partnership is value creation. When coupled with the May 23, 2025 Executive Orders, we believe the US Government’s participation in the partnership creates the right incentives to deploy its full suite of tools behind the construction of Westinghouse reactors, including financial, regulatory, policy and diplomatic support. That support is expected to drive additional value for the partnership and the many stakeholders who are expected to benefit from enhanced energy, national and climate security around the world.
“We expect that the new build commitments from the US will bolster broader confidence in the durable growth profile for nuclear power, and support increased demand for Westinghouse’s and Cameco’s products, services and technologies. This new partnership highlights the role that Westinghouse’s reactor technologies, based on fully designed, licensed and operating reactors, are expected to play in the planned expansion of nuclear capacity and diversification of global nuclear supply chains. Cameco remains well positioned as a secure and reliable supplier that can fuel the long-term reliable operation of Westinghouse’s technology in the US and globally.”
The launch of a nuclear power plant construction program is expected to accelerate growth in Westinghouse’s energy systems segment during the construction phase, along with its core fuel fabrication and reactor services business for the life of the reactors. Upon closing of the transaction and with financing facilitated by the US Government, Westinghouse plans to commence project execution and initiate orders for critical equipment with long lead times, which is expected to leverage the nuclear industry supply chains that were established during the construction of Vogtle units 3 and 4.
Cameco, as one of the world’s largest and most reliable suppliers of uranium and nuclear fuel services and components, is well-positioned with what is expected to be tremendous upside optionality to benefit from the continued expansion of nuclear power in the US and globally, through the anticipated acceleration of nuclear fuel demand growth as a result of this partnership.
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Partnership Structure
Under the new strategic partnership, the US Government will be granted a participation interest (Participation Interest), which, once vested, will entitle it to receive 20% of any cash distributions in excess of US$17.5 billion made by Westinghouse after the granting of the Participation Interest. For the Participation Interest to vest, the US Government must make a final investment decision and enter into definitive agreements to complete the construction of new Westinghouse nuclear reactors in the US with an aggregate value of at least US$80 billion.
Additionally, in recognition of the anticipated acceleration of long-term value creation that the US Government is expected to help unlock by deploying its financial, regulatory, policy and diplomatic tools to support the objectives of the partnership, if, on or prior to January 2029 the Participation Interest has vested, and if the valuation in an initial public offering (IPO) of Westinghouse is expected to be US$30 billion or more at that time, the US Government will be entitled to require an (IPO). Immediately prior to, or in connection with the IPO, the Participation Interest will directly or indirectly convert into a warrant, with a five-year term, to purchase equity securities equivalent to 20% of the public value of the IPO entity at the time of exercise after deducting US$17.5 billion from the public value.
Brookfield and Cameco acquired Westinghouse in November 2023. The partnership brought together Cameco’s expertise in the nuclear fuel supply chain with Brookfield’s recognized position as one of the world’s largest investors in energy generation technologies.
The transactions and other matters contemplated by the term sheet with the US Government are subject to, among other risks, the factors discussed below under Forward Looking Information. The expectation is that the US Government, Brookfield, Cameco and Westinghouse will negotiate and enter into definitive agreements replacing the binding term sheet, but, in the event such agreements are not reached, the term sheet will remain effective.
The transactions are subject to obtaining required regulatory approvals and the satisfaction of other customary conditions.
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Premier Scott Moe said on X, “Today’s $80 billion nuclear reactor deal between Cameco, Brookfield and the US is a transformational partnership that will benefit Saskatchewan, Canada and the US by building North American nuclear technology, utilizing Canadian uranium and ensuring Saskatchewan jobs for years to come. In a challenging time, this is an example of a positive step in energy security for the USA and Canada.”
Indeed, if numerous large reactors are built in the United States, the opportunity notably improves uranium production prospects for Saskatchewan’s mining sector.
About this time last year, Westinghouse held a suppliers forum in Saskatoon, seeking to establish part of its supply chain here, in this province. A consistent theme throughout the forum was modular construction. With the exception of particular large items that must be in one piece, Westinghouse’s approach is to build reactors with modules that can be shipped on a flatbed truck. That, in turn, should allow a much broader supply chain.
There are also implications for SaskPower. On Oct. 20, Minister of Crown Investments Corporation Jeremy Harrison released the “Saskatchewan First Energy Security Strategy and Supply Plan.”
At the time, Harrison said, “We have made the binary decision. We are going to nuclear. That is a central part of the energy security strategy is the formal commitment to nuclear.”
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The plan specifically says:
The Government of Saskatchewan will:
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continue to examine the feasibility of two SMR (small modular reactor) units near Estevan;
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evaluate the feasibility of large reactors and/or advanced SMRs to meet industry demand for electricity and heat to identify if either can be economically deployed in Saskatchewan.
Harrison said on Oct. 20, “So with regard to the SMR project, we’re working through that we have a road map on the SMR. We also are keeping that open mind on large scale, nuclear as a as a part of our future power mix as well.
The following day, in response to a question from Pipeline Online regarding large reactors, Premier Scott Moe twice referenced Elbow as a possible location. That full press conference will be transcribed and published soon by Pipeline Online.
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Moe has been talking about the possibility of 1,000 megawatt-scale reactors ever since Cameco and Brookfield bought out Westinghouse. Depending on cooling configurations, the AP1000 can produce up to 1,200 megawatts. That means if you have two SMRs at 300 megawatts each, and two AP1000s at 1,200 megawatts each, your total is a nameplate capacity of 3,000 megawatts between four reactors.
And that would be able to supply the entire Saskatchewan grid for large parts of the spring and fall, at current demand levels. However, it would not be enough for expanded demand. In winter, high demand is around 3,600 megawatts, and the most we’ve seen to date is 3,910 megawatts on a very cold Dec. 30, 2021.
And depending on how long it takes to build the large reactors, if they come online in the 2040s, that would be just a few years before the current fleet of natural gas-fired turbines are reaching their end of life, which is around 30 years. Chinook Power Station went online in 2019, Great Plains in 2024, and Aspen will go online in 2027. So even though they are quite new now, natural gas plants have a much lower life expectancy than coal plants, barring possible (and likely) refurbishments.
If the United States does indeed to a massive buildout of AP1000s, the economies of scale should hopefully have a dramatic impact on the price. The typical cost overruns for nuclear in the past has been in large part of a result of each project being essentially a on-off, with many different designs over the years and then a decades long hiatus until the two AP1000 Vogtle AP1000s went online. But as that design is now essentially locked, the expectation is the price will be lower. In an interview with Pipeline Online to be published soon, Westinghouse Canada president John Gorman said you can expect future AP1000s to be less that Vogtle in cost, in part because “you can have it in any colour, as long as it’s black,” he said, riffing off Henry Ford’s famous quote about the Model T. With a locked down design, lower prices should hopefully make them much more affordable for all customers, including SaskPower.
Harrison said in a statement to Pipeline Online on Oct. 29, “The $80 billion nuclear reactor deal involving Cameco, Brookfield, and the United States represents a transformative partnership that will bring significant benefits to Saskatchewan, Canada, and North America.
“This collaboration will advance nuclear technology across the continent, leverage Canadian uranium resources, and secure Saskatchewan jobs for the future. Amid these challenging times, this initiative exemplifies a positive step towards energy security for the United States and Canada.
“Saskatchewan plays a key role in this partnership, while we were not involved in the development of this deal we are encouraged and supportive of its potential.
“Our province is home to the world’s highest-grade uranium deposits and was responsible for nearly one quarter of global production in 2024.
“Saskatchewan’s uranium sector is built on innovation, environmental stewardship, and a highly skilled workforce that continues to set industry standards for excellence. This agreement highlights the vital role our resources will continue to play in advancing clean, reliable, and secure energy for the future.”
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