03 March 2011
The US Department of Energy (DoE) will sell off excess uranium over the next three years to help fund the cleanup of a former enrichment site but has determined this will not adversely affect uranium markets.
Now, energy secretary Stephen Chu has announced there would be no adverse impact on domestic uranium industries from a proposed transfer of 450 tonnes of uranium (tU) per quarter, starting this year.
This determination was based on an Energy Resources International (ERI) analysis and takes into account other sales or transfers into the market of DoE uranium, including low enriched uranium from the downblending of weapons material under the DoE's National Nuclear Security Administration (NNSA). Including the NNSA's scheduled transfers, the DoE would be transferring approximately 2000 tU per year over the three years involved, 2011-2013.
The transfers could result in an average $4.45 per pound decrease in spot market prices over the three years to 2013 and a $1.24 reduction in long-term prices, ERI has found.
This compares to current spot market prices of around $69 per pound quoted by UX Consulting and Tradetech. However, the uranium will be transferred as UF6, so could potentially trigger slight falls in conversion and enrichment prices, although the analysts note that in reality many market participants have already anticipated most of the impacts based upon statements released by the DoE in previous years.
ERI warns that "perceived uncertainty" over potential future DoE involvement in the commercial sphere might have a greater potential impact on the market than the likely effects on prices and the possible displacement of domestic uranium production that could arise from the proposed transfers.
The gaseous diffusion uranium enrichment plant at Portsmouth began operations in the 1950s, enriching uranium for military use, but from the 1960s it produced low enriched uranium for use in civil nuclear power stations alongside the Paducah plant in Kentucky. Enrichment ceased at Portsmouth in May 2001 and operations were consolidated at Paducah, which is still operating. In August 2010 the DoE awarded a $2.1 billion contract to a joint venture of Fluor Corporation and Babcock and Wilcox for decontamination and decommissioning of the vast Portsmouth site.
Read more:
http://www.world-nuclear-news.org/ENF-US_uranium_sale_to_fund_site_cleanup-0303117.html.aspx
