In the meantime, demobilization will proceed
– By Stephen Heiser –
USEC Inc. has announced that it is requesting that the Obama administration review further the economic recovery and national and energy security benefits of providing a loan guarantee for the American Centrifuge Plant in Piketon, Ohio. This announcement comes in response to the U.S. Department of Energy’s (DOE) request that USEC withdraw its application for loan guarantee funding.
“We believe the American Centrifuge Plant meets the financial and technical requirements of the Department’s Loan Guarantee Program as well as numerous Obama administration policy objectives,” said John K. Welch, USEC president and chief executive officer. “Accordingly, we plan to pursue further discussions with DOE to work with them to address any remaining technical and financial concerns they may have.
“As a result of the current uncertainty regarding DOE loan guarantee funding, we have been forced to begin the process of demobilizing the project and initiating layoffs that will directly affect nearly 2,000 current USEC and contractor employees in Ohio and several other states in the near term and indirectly impact thousands more,” Welch added.
“Reluctantly, we have no choice but to begin demobilization. However, we hope that the demobilization process can be averted by quick action by the Obama administration. USEC is prepared to work with DOE and the Obama administration to fashion a mutually acceptable loan guarantee that protects the taxpayers’ interests, while providing the financing needed to deploy the American Centrifuge Plant.
“We previously provided DOE with a financially sound path forward for completing the project. Specifically, to ensure repayment and protect U.S. taxpayers, USEC offered to provide a $1 billion parent guarantee that would be fully collateralized by non-project, corporate assets,” Welch added. “This structure would allow DOE to proceed with funding on a fully protected basis and avoid demobilization while USEC would continue to address any remaining technical and financial issues over the next 9-12 months. This offer is still on the table, and we believe it can provide the path to prompt implementation of federal loan guarantee funding for this important national project.”
USEC also disagrees with DOE’s characterization that the American Centrifuge technology is not technologically ready to move to commercial operations. Building upon DOE’s decade of experience with centrifuge machines, USEC has operated the centrifuges for over 235,000 machine hours, giving the Company data and expertise to begin the transition to commercial operation.
USEC’s customers have also expressed confidence in the technology and have already committed to purchasing over half of the initial, planned output of the American Centrifuge Plant. Christopher M. Crane, president and chief operating officer of Exelon, the largest nuclear utility in the United States, said: "We have confidence in the American Centrifuge technology, and we believe it would be an important player in the future of uranium enrichment.”
USEC strongly believes in the American Centrifuge technology and is committed to further interactions with DOE and the Obama administration to find an acceptable path forward. As America's only commercial uranium enrichment facility using U.S.-owned and operated centrifuge technology, the American Centrifuge Plant can play an important role in America's energy security and national security.
USEC Inc., a global energy company, is a leading supplier of enriched uranium fuel for commercial nuclear power plants.