Nuclear restructuring continues in France as New Areva becomes Orano

24 January 2018

French nuclear fuel company New Areva (formerly part of state-owned Areva) on 23 January was rebranded as Orano.

“Refocused on nuclear materials development and waste management, Orano’s activities encompass mining, conversion-enrichment, used fuel recycling, nuclear logistics, dismantling and engineering,” the company said in a statement.

The group has 16,000 employees, with revenue of €4bn and an order backlog that represents the equivalent of nearly eight years of revenue. The name Orano has its etymological roots in the word "uranium". Ouranos, the Greek god who became Uranus in Roman mythology, and from whom the planet Uranus takes its name, was later to serve as a point of reference when the term 'uranium' was created.

The company said Orano symbolises a new start that has been under preparation for several years now. "We have set up a new organisational structure, a new business plan, a new strategic action plan and a new social contract. Our new identity is the natural result of all this.”

CEO Philippe Knoche said: “We had to change our name – we are a new company with a different perimeter, focused on the fuel cycle.” To reduce real estate costs by €10m a year, Orano plans to move out of its prestigious Paris as part of a plan to cut costs by about €250m in 2018-2020. After the nuclear reactor construction unit of Areva was sold to state-owned utility EDF in 2017 as New NP, New Areva, now Orano, reverted to being a nuclear fuel company, similar to its predecessor Cogema, before it was merged with reactor construction company Framatome in 2001 to become Areva.

Orano has net debt of some €3bn, but by 2025 plans to invest about €2bn in its plants and a similar amount in its mines, Knoche said. He added that the company aims to be cash-flow positive from this year, but said nothing about profit targets and admitted that market prices for uranium are too low to invest in new mines. Japan’s 2011 Fukushima disaster led to a slowdown in reactor new builds with some countries such as Germany abandoning nuclear. Knoche said Orano was optimistic about the growth of nuclear power in Asia and expects to earn 30% of its turnover there by 2020, up from 20% last year.

Knoche said a new name and logo were necessary to start another chapter in the history of the company. Areva was split in two and recapitalised in 2017 after years of losses destroyed its equity. EDF recently renamed New NP as Framatome, reverting to its original name, but further changes are expected. French Energy Minister Nicolas Hulot said on 22 January that the government had discussed the possibility of putting state-owned utility EDF’s nuclear activities in a separate legal unit, although nothing had been decided. “This is part of the suggestions, but no single solution has a preference,” he told reporters. Sources told Reuters in November that the French finance ministry is studying several scenarios for restructuring EDF, including spinning off its nuclear power generation activities into a standalone unit.

As for Orano,  Knoche said: "Our new name symbolises our conviction: nuclear power has a future, as it is a competitive, low-carbon energy [source] that creates jobs."

"We have big ambitions for Orano, namely for it to become the leader in the production and recycling of nuclear materials, waste management, and dismantling within the next ten years.”



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