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States compete for USEC’s next generation nuclear fuel test facility

Sept. 5, 2002 — USEC Inc. has received initial proposals from the states of Kentucky and Ohio for the siting of a test facility that will showcase improvements to the U.S. Department of Energy’s (DOE) proven centrifuge uranium enrichment technology, resulting in the world’s most efficient process for enriching uranium for nuclear fuel.

Later this year, USEC will choose either the Paducah, Kentucky or Portsmouth, Ohio gaseous diffusion plant as the site for its high-tech, “lead cascade” centrifuge facility.

“USEC will spend approximately $150 million over the next five years to deploy up to 240 improved full-scale centrifuge machines which, based on previous performance, will be the most economical in the world,” said Dennis Spurgeon, USEC executive vice president and chief operating officer. “We have tripled our centrifuge staff in the last year, and we expect to triple it again this year.

“Nuclear power produces 20 percent of the electricity in the United States,” said Spurgeon. “USEC’s deployment of U.S. centrifuge technology will help ensure America’s energy security and provide a continued, reliable and competitive fuel source for the world’s nuclear reactors while ensuring continued employment at Paducah or Portsmouth.”

The proven centrifuges that USEC is updating were originally developed and tested for thousands of hours by DOE from the 1960s through the mid-1980s. More than 1,000 centrifuge machines were manufactured and operated at DOE facilities. At that time, they performed at levels substantially in excess of the machines being used by our competitors recently as well as their next generation of yet-to-be installed equipment.

USEC has taken the centrifuge technology that DOE spent more than two decades and $3 billion developing and is further improving its economics through the use of state-of-the-art materials and manufacturing processes.

USEC’s work on U.S. centrifuge technology began in 1999. In June 2002, USEC signed an agreement with DOE to further develop advanced uranium enrichment technology. DOE is cooperating with this effort by providing access to government technology and expertise.

USEC committed to begin construction of its lead cascade facility in 2004 and begin operating it in late 2005, with a commercial U.S. centrifuge enrichment plant coming on line later this decade. Under this program, actual work on hardware for the new facility is already underway, capitalizing on DOE’s $3 billion investment in this superior technology. All funding for developing and deploying U.S. centrifuge technology will be provided by USEC.

USEC and UT-Battelle are currently finalizing a new Cooperative Research and Development Agreement (CRADA), that will facilitate continued work with Oak Ridge National Laboratory (ORNL). The CRADA requires DOE approval prior to execution by UT-Battelle. Many of the ORNL scientists and engineers responsible for developing the original U.S. centrifuge technology are working on USEC’s lead cascade program.

The lead cascade is the basic building block of a commercial uranium enrichment plant. It will consist of up to 240 full-scale centrifuge machines enriching uranium in a closed cycle. Its purpose is to provide updated cost, schedule and performance data for building a $1 billion to $1.5 billion commercial centrifuge enrichment plant.

“We are confident that successful operation of this improvement to DOE’s previous work will definitively demonstrate this leading-edge technology and will attract partners and/or investors with an active interest in this significant project,” Spurgeon said. “Additionally, it will provide approximately 50 additional jobs in Kentucky or Ohio during the lead cascade period, approximately 1000 contract jobs in manufacturing the centrifuge machines and in construction, and approximately 500 jobs when the full plant is built,” Spurgeon said.

After reviewing the initial siting proposals from Kentucky and Ohio, USEC will provide feedback and request final proposals by the end of October. USEC will announce the lead cascade site later this year.

By April 2003, USEC will submit an application for the lead cascade to the U.S. Nuclear Regulatory Commission, begin construction in 2004 and complete construction and begin operations in 2005.

USEC Inc., a global energy company, is a supplier of enriched uranium fuel for commercial nuclear power plants.

Source: USEC