USEC Secures $29.9M in Federal Funding to Advance Centrifuge Demonstration

An amendment signed by USEC subsidiary American Centrifuge Demonstration to a June 2012 research, development and demonstration (RD&D) cooperative agreement with the Department of Energy gives the uranium enrichment technology firm an additional $29.9 million in government cost-shared funding, enough to fund the American Centrifuge program through September.

The DOE has to date poured $227.7 million into USEC’s RD&D program to support building, installing, operating, and testing commercial plant support systems and a 120-machine cascade that would be incorporated in the full commercial American Centrifuge Plant in Piketon, Ohio, which is planned to operate 96 identical cascades. The agreement reached in June 2012 calls for the DOE to provide a total of $280 million (USEC will provide $70 million). As part of the agreement, USEC has granted the DOE a non-exclusive royalty-free license in centrifuge intellectual property for government purposes, as well as ownership of equipment produced or acquired as part of the RD&D program.

In a statement on July 29, USEC said five of the program’s nine milestones have been completed and certified by the DOE. USEC successfully completed the sixth milestone to test the effects of a power loss to the uranium centrifuge machines earlier this month; DOE certification of that milestone is pending. The three remaining milestones are scheduled for completion by the end of the program in December.

All of the commercial-grade centrifuges are now reportedly spinning individually at target speed, and the process of conditioning the centrifuges and related piping on uranium hexafluoride gas is underway. USEC expects to operate the centrifuges as an interconnected cascade in the fourth quarter, once startup and conditioning actions are completed in the third quarter.

“To date, the program has achieved every milestone ahead of schedule and with solid results. The overall program remains on schedule and on budget,” said Paul Sullivan, vice president of American Centrifuge and chief engineer. “The technology works, and we are getting excellent results.”

The DOE’s remaining cost share of up to $52.3 million depends on Congressional appropriations and on USEC continuing to meet all milestones and deliverables on schedule. The administration included transfer authority of $48 million to fund the program in the president’s Fiscal Year 2014 budget proposal and the same funding level is in the FY2014 Energy and Water Appropriations bill approved by the U.S. House of Representatives on July 10, 2013, and in the Senate version of the bill reported to the Senate by the Senate Appropriations Committee on June 27, 2013.

"USEC believes that this level of funding, if provided, would be sufficient to complete the RD&D program, though there are no assurances the additional funding will be made available," the company said.

Sources: POWERnews, USEC