The Toronto-based uranium miner also said Monday that uranium prices fell throughout the third-quarter and into the start of the current three-month period.
The company booked a quarterly loss of $61.6 million, or six cents per share, compared to a profit of $45.8 million, or five cents per share, a year earlier.
On an adjusted basis, earnings were $7.6 million or a penny per share, compared to adjusted net earnings of $46.4 million or five cents per share in the same period the previous year.
Revenues slipped to $142.6 million from $157.7 million.
The company said the decision to shutter the South Zarechnoye project, located in southern Kazakhstan, came after uranium sales were hard hit following the earthquake and tsunami in Japan last year that crippled the Fukushima nuclear plant.
"It would not be economical to mine the South Zarechnoye deposit due to the decrease in uranium prices since the Fukushima incident, together with a decrease in the (project's) resource base resulting from recent exploration results and the completion of an economic assessment," the company said in a release.
Production was 23 per cent higher at 3.1 million pounds in the third quarter while sales volumes grew eight per cent. However, the average realized sales price fell to $49 per pound from $51 per pound in the third quarter of 2011.
Uranium One said prices have been falling in recent months, going below the $50 per pound mark in the third quarter to a range of $46.50 to $49.50 per pound, due to higher supply levels.
The company said those prices slid even further in the early part of the fourth quarter, with prices currently at about $41.
"Fundamentals for the medium and long term, however, remain positive, especially following the announced deferrals of a number of large, high profile uranium mining projects," the company said.
Uranium One is holding its production guidance for the year at 11.6 million pounds, while production for next year is expected to be 12.5 million pounds.