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2024-05-16 06:40:00

U.S. NUCLEAR: NO ANSWERS

U.S. NUCLEAR: NO ANSWERS

PLATTS - May 10, 2024 - US nuclear operators and nuclear fuel market participants have asked a series of questions to the US Department of Energy in a meeting last week, eager to learn details of a system of waivers being developed in connection with the passage of a ban on Russian enriched uranium late last month. DOE officials, while guarded, told the industry it would be ready for speedy and reasoned adjudication of waiver claims, according to attendees.

The Senate unanimously approved the measure April 30, following passage of a similar bill in the House of Representatives in December. The ban takes effect 90 days after President Joe Biden signs the bill into law.
Under an as-yet disclosed waiver system, companies with enriched uranium contracts with Russia can seek to continue to receive their material by demonstrating they do not have viable alternate sources of fuel or that continued deliveries are in the national interest.

Two people who attended an April 30 meeting with DOE officials said the department indicated it will be ready to publish a Federal Register notice within 30 days of enactment of the legislation outlining the process for seeking waivers.

The legislation is designed to reduce US reliance on Russian uranium for nuclear fuel following Russia's 2022 invasion of Ukraine. Russia supplies about 20% of US reactor operators' enrichment needs, although most utilities have sought to reduce their dependence on Russian state nuclear company Rosatom in recent months.

However, a utility fuel buyer said there was skepticism among some participants that the department would be ready, as there are myriad complexities around the process and timetables.

"They still don't have a lot of answers," the fuel buyer said.

Biden has not signed the legislation, which was sent by Congress to the White House May 8, according to one meeting participant. The bill becomes law if the president does not veto it within 10 days of formal receipt from Congress, whether he signs it or not, several meeting participants said.

Questions were raised during the meeting about whether the names of those receiving waivers would be made public, whether uranium coming into the country for fabrication into fuel and export out of the US would require or receive waivers and what criteria would be used to permit utilities to receive Russian fuel, the people said. All those who spoke about the meeting did so on condition of anonymity to discuss the private meeting and avoid hurting their relationship with the DOE.

The rapid timeframes involved raise questions as well, the fuel buyer said. "How are they going to do this on a 90-day schedule, when there are ships literally on the water" containing enriched uranium, the person said.

A uranium producer in attendance said DOE officials indicated they would seek to act as rapidly as possible for requests on material in transit or requiring a decision regarding short-term deliveries.

An industry official who attended the meeting said DOE indicated it would take a "relaxed approach, particularly over the next couple of years," in approving end-user waivers. Still, the department was noncommittal in its plans, the person said.

DOE plans to request detailed information on why a delivery should be allowed, with information on the impact on the national interest as well as the potential challenges in securing replacement material, the attendees said. Utilities would need to show that inventories are not sufficient to replace the imported material, one of the people said. DOE would adjudicate those claims, this person said.

The uranium producer said the passage of the legislation offered miners a better option than the potential for executive action which the White House had indicated could take place should Congress fail to act. He said DOE in its meeting seemed unaware that the legislation was about to be passed by the Senate later that day, and so some of the department's comments were guarded because officials did not know whether an executive order barring the imports or the language of the House legislation would prevail.

Centrus preparing for waiver submittal

The applicant for the waivers must be the importer of record, one person who attended the meeting said. This would mean that in the case of re-sellers of Russian enrichment services, such as Centrus, the re-seller would apply on behalf of customers, this person said.

Centrus and its predecessor companies have for several years purchased from Russia's state-owned Tenex an annual quantity of Russian enriched uranium under a quota set by the Russian suspension agreement, then sold the LEU to utility customers.

"We obviously have all the intentions to apply for a waiver at the first opportunity," said Centrus President, CEO and Director Amir Vexler in a first quarter earnings call May 8. "Yes, we've been preparing. We're going to make use of this process, and it is extremely important, not only to Centrus, but to the industry here in the US."

The company could find itself in a precarious financial position without access to enriched uranium to deliver to customers.

"In terms of how our contracts are structured and what recourse we have, we really are working on and have been working on contingency plans even beyond the waiver," Vexler told analysts.

The matter of whether names of those receiving waivers will be made public was discussed, several people said. Several utility fuel buyers have said they feel that Congress should be notified confidentially of the names, but that they should not be made public.

However, the uranium producer said a DOE official suggested that making the names public is being considered.

International impact

US utilities are not the only ones affected by the ban, several people said. Any foreign utility that has Russian enriched uranium delivered to a US fuel fabricator for re-export as fuel would also need a waiver, they noted.

DOE mentioned that utilities should be aware of at least one such pending case, which two people said is likely a reference to Mexico's Comision Federal de Electricidad, which operates two GE-supplied boiling water reactors that get fuel from the US.

DOE officials reminded participants in the meeting that any process and all waivers will still have to comply with US sanctions requirements, one attendee said, and that waiver requests will have to take into account the availability of the American Assured Fuel Reserve, a stockpile of government-owned enriched uranium designed to protect nuclear operators from a disruption of nuclear fuel availability.

DOE did not immediately respond to a request for comment.

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Tags: USA, NUCLEAR, RUSSIA, URANIUM