USEC deals with Tenex for enriched uranium
US uranium enrichment company USEC has signed a multi-year contract with Russia's Techsnabexport (Tenex) for the ten-year supply of low-enriched uranium (LEU). The companies will also consider the construction of an enrichment plant in the USA using Russian technology.
Tenex will start supplying the LEU in 2013 under a contract signed yesterday in Washington, DC, by USEC senior vice president Philip Sewell and Tenex director general Alexey Grigoriev. The amount will be increased up to 2015 when it will reach about one-half the level currently supplied by Tenex to USEC under the Megatons to Megawatts program. The agreement includes the mutual option to increase the quantities up to the same level as that program. Deliveries under the contract are expected to continue until 2022, USEC said.
"Unlike the Megatons to Megawatts program, the quantities supplied under the new contract will come from Russia's commercial enrichment activities rather than the downblending of excess Russian weapons material," USEC said.
The company said that, due to current restrictions on the quantity of enriched uranium that can be imported into the USA from Russia up to 2020, it will "deliver a portion of the enriched uranium to US utilities with most of the enriched uranium to be delivered to USEC's customers outside of the United States in both existing and emerging markets."
The agreement between Tenex and USEC is subject to approval from Tenex's parent, Russian state nuclear energy company Rosatom, as well as requiring the completion of "administrative arrangements" by both the US and Russian governments. USEC expects these arrangements to be in place before the end of 2011.
USEC CEO and president John Welch commented, "We believe this new contract will further strengthen our important relationship with Tenex. Over the past two decades this relationship has supported our efforts to provide long-term reliable supplies of enriched uranium to our customers while maintaining a strong domestic production capacity based on US technology."
New centrifuge project?
"The new contract assures USEC continued access to an important part of its existing supply mix, which complements USEC's ongoing efforts to deploy the American Centrifuge Plant (ACP) in Piketon, Ohio, using advanced centrifuge technology," the company said in a statement. It added, "By supplementing its domestic capacity with continued access to Russian LEU, USEC can assure customers that its supply mix will remain sufficiently robust to meet their needs throughout the transition to the American Centrifuge Plant."
USEC said that once the LEU supply agreement with Tenex is approved by Rosatom, the two companies will conduct a feasibility study into the deployment of an enrichment plant in the USA using Russian centrifuge technology. The study will examine international agreements, government approvals, licensing, financing, market demand and commercial arrangement. A memorandum of understanding regarding setting up a joint venture to build a US plant, signed by Tenex and USEC in January 2010, came into effect with the signing of the contract yesterday.
USEC said that if the decision is subsequently made to construct such a plant, "such a project would not be deployed until after completion of the American Centrifuge project."
The ACP had originally been intended to start up in 2010, but work slowed and was temporarily suspended in 2009 when the Department of Energy (DoE) refused it a federal loan guarantee. Since then, DoE has accepted an updated loan guarantee application from the company, and USEC has also secured a $200 million investment from Toshiba and Babcock & Wilcox. USEC estimates that it will take about 24 months to begin commercial operations after it receives the financing it needs to finish the plant.
In February, USEC and the DoE agreed to modify milestones for the deployment of centrifuge enrichment technology at the ACP. Four out of fifteen agreed milestones related to the financing and operation of the plant were modified in order to provide "additional flexibility" as USEC works towards obtaining financing for the plant under the DoE's loan guarantee program. Eleven other milestones relating to the deployment of the American Centrifuge technology agreed with the DoE have already been met.
The new agreement sees the milestone for USEC to secure firm financing commitments for the project put back by one year to November 2011. As a result, the other milestones to be updated are for the start of commercial operations, now set for May 2014, achieving an annual capacity of 1 million SWU, which moves to August 2015, and achieving a capacity of 350 SWU per year by 2017.
Researched and written
by World Nuclear News
