US to Start $3.4 Billion Buy-Up of Domestic Nuclear Reactor Fuel

(Bloomberg) -- The US will ask suppliers next month to bid on contracts for as much as $3.4 billion of domestically produced nuclear reactor fuel, according to a government notice.

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Around $2.7 billion of the funding comes from a broader plan to wean the nation off nuclear fuel imported from Russia and forms part of a strategy to help restart domestic nuclear fuel production by making direct purchases of the low-enriched uranium used in reactors. That cash was unlocked after President Joe Biden signed a ban on imports of enriched uranium from Russia, which provides about a quarter of the reactor fuel in the US, making it the country’s top supplier.

Read More: US Reactor Fuel Makers Get $2.7 Billion in Funding Bill

The US was once a leading supplier of enriched uranium but lost its edge in the industry decades ago. The country now has just one commercial enrichment facility in New Mexico, owned by Urenco Ltd., a British, Dutch and German consortium.

Bethesda, Maryland-based Centrus Energy Corp. has said it will compete for the funding. The fuel supplier, which currently gets the majority of its uranium from Russia, plans to produce its own low-enriched uranium and has reported securing about $900 million in conditional sales commitments. Centrus also began production in October at a pilot plant that makes specialized, highly enriched uranium to be used in new breed of advanced reactors.

In addition to Centrus, companies that could benefit from the spending include ConverDyn, a joint venture between Honeywell International Inc. and General Atomics that provides uranium conversion services, and Global Laser Enrichment, jointly owned by Silex Systems LTD and Cameco Corp.

Read More: Biden Signs Ban on Imports of Russian Nuclear Reactor Fuel

Domestic uranium mining companies could see a benefit from the funding as well, said Scott Melbye, president of the Uranium Producers of America, which represents such companies as Cameco Corp., Energy Fuels, Inc., Ur-Energy, Inc., and Uranium Energy Corp.

“US enrichment is going to favor and support western sources of uranium, so any sort of expansion of western enrichment over Russian enrichment is good for our business,” Melbye said in an interview.

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