French nuclear group Areva SA announced that it has begun processing uranium ore at its Canadian mill at McClean Lake, Saskatchewan.
The mill, idled in 2010, has been undergoing modifications to allow it to process ore from the province's Cigar Lake uranium mine, which is operated by Cameco Corp. Reuters reported.

"It's been a long story (with) many challenges," Vincent Martin, chief executive officer of Areva's Canadian unit, said in a joint phone interview with Cameco's chief executive, Tim Gitzel.

The $2.34 billion Cigar Lake mine is set to become one of the world's biggest by 2018. It has faced numerous delays from flooding issues but is expected to come on line in time to meet expected demand from Japan.

The earthquake and tsunami in 2011 that crippled the Fukushima-Daiichi nuclear power plant led the government to shut down nearly all of Japan's reactors, driving the spot price of uranium lower.

Gitzel said there was "not a chance" that Cameco would take Cigar Lake off-line until market conditions improved.

"We would bring this mine on in any event," he said. Cameco and Areva need to replace uranium it once acquired through the now-expired program to convert highly enriched uranium from dismantled Russian nuclear weapons into low-enriched uranium for nuclear fuel.

Cameco started mining at Cigar Lake in March and has so far delivered 1,400 tonnes of ore to McClean Lake, Cameco said in a statement.

Problems with a mining process that involves freezing ore and the ground led to a halt in production in July, but it resumed in early September, Reuters reported.

The mill is expected to produce up to 1 million pounds of uranium concentrate from Cigar Lake ore in 2014 and ramp up to 18 million pounds by 2018.