The US International Trade Commission (ITC) has concluded that allowing market forces to determine the source of uranium products in the US would “materially injure the US uranium industry.” Consequently it has ruled that terminating the 1992 antidumping suspension agreement that limits imports of Russian uranium products would likely cause material injury to domestic producers, including USEC.
The decision follows a 31 May ruling by the US Department of Commerce (DOC) that “unfair dumping” of Russian uranium products would likely recur if the Russian suspension agreement were terminated. As a result of the two rulings, the existing suspension agreement will remain in place.
“We’re pleased that the US government agrees that lifting the agreement that limits Russia uranium imports would undermine the domestic production of enriched uranium and the deployment of new uranium enrichment capacity,” said USEC president and CEO John K. Welch, adding that the ruling is an important step in maintaining a stable nuclear fuel market, which the United States needs in order to invest in advanced uranium enrichment technologies.
Despite the positive decision, USEC has announced delays in its plans to operate a full centrifugal enrichment cascade late this summer at its demonstration facility in Piketon, Ohio.
Announcing its half year results the company said: “While we expect to be operating a small number of machines at the demonstration facility by late summer, we have adjusted our plans to have a full Lead Cascade of machines installed and operating by mid-2007.” USEC added that while it could have installed a full lead cascade of machines they would perform at less than the company’s target of 320 SWU, or separative work unit, per machine.
The company further reported that expenses related to its American Centrifuge projects were $3.2 million higher than in the second quarter of 2005.
USEC said in a statement: “As with any large scale development-to-commercialisation project, we have experienced various challenges in manufacturing and testing that have caused delays and over the course of the project we are likely to encounter additional challenges. The statement added: “Under the DOE-USEC Agreement, we have a milestone in October 2006 to obtain satisfactory reliability and performance data from Lead Cascade operations.”
In its 2006 outlook USEC estimates total spending on the American Centrifuge project is expected to be approximately $185 million, a decrease of about $5 million from earlier estimates, but with a higher proportion being expensed rather than capitalised due to delays.
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