IAEA buys uranium for LEU Bank

Wednesday, 21 November 2018

The procurement is the IAEA's largest since it was founded in 1957. The LEU supplied by Kazatomprom and Orano will be transported to the IAEA's LEU storage facility at the Ulba Metallurgical Plant in eastern Kazakhstan.

The names of the successful bidders have been published on the United National Global Marketplace website, in line with standard IAEA procedures for open tender. The agency, which does not publish contract prices, said it had taken additional measures to protect any information on the price of the LEU in order to avoid disrupting the price of uranium on the international market. This is in line with a 2010 mandate from the IAEA's Board of Governors, when the board authorised the establishment and operation of the Bank.

The Bank is part of global efforts to create an assured supply of nuclear fuel to countries in the event of disruption of the commercial market or other existing LEU supply arrangements. It will provide an assurance of a supply mechanism of last resort for IAEA member states which experience a supply disruption owing to exceptional circumstances and are unable to secure nuclear fuel by other means. States wishing to purchase LEU from the Bank must have in force a comprehensive safeguards agreement with the IAEA and be in good standing regarding their obligations under the Non-Proliferation Treaty.

The physical reserve will hold up to 90 tonnes of LEU, suitable to make fuel for a typical light water reactor. The IAEA-owned and -managed 880 square metre high-security warehouse in Ust-Kamenogorsk, where the material will be stored, was officially inaugurated in August 2017. The IAEA LEU Bank will be officially established once the LEU has been delivered to the storage facility.

Kazakhstan in 2011 offered to host the IAEA LEU Bank in response to an IAEA request for expressions of interest. A Host State Agreement between the IAEA and government of Kazakhstan was signed on 27 August 2015. The IAEA describes the Ulba Metallurgical Plant, where the storage facility is situated, as a licensed nuclear site with commercial scale operations and the complete infrastructure to safely and securely store, transport and process LEU. The IAEA and Russia have signed a transit agreement to enable LEU to be delivered to and from the Bank.

The establishment and operation of the Bank has been fully funded by voluntary contributions from IAEA Member States and other donors totalling USD150 million, which the agency says is sufficient to cover estimated costs for 20 years of operation.

Other assurance of supply mechanisms established with IAEA approval include a guaranteed physical reserve of LEU maintained by Russia at the International Uranium Enrichment Centre in Angarsk, Russia, and an assurance of supply guarantee for supplies of LEU enrichment services in the UK. The USA also operates its own LEU reserve.