Tenex and Centrus extend uranium supply agreement

5 January 2016

Russian nuclear materials trading company Techsnabexport and the US firm Centrus Energy Corp (formerly USEC Inc) have agreed to modify the long-term contract for supply of uranium enrichment services by extending it until 2026, according to a Tenex statement.

The renewed contract reflects changes in the nuclear fuel market, strengthens the partnership between the companies, which play an important role in Russia-US nuclear cooperation over more than 20 years, said Centrus president and CEO Daniel Poneman. Tenex director general Lyudmila Zalimskaya stressed that the new agreement strengthened long-term relations.

Identical statements issued on 22 December said: "While reaffirming the original commitment to purchase 17m SWU from 2016 to 2022, the revised agreement permits some quantities to be deferred for delivery until 2023 to 2026, along with additional quantities to be purchased in those years."

Poneman said the agreement "reflects the changing fuel market and extends our supply arrangement for a decade, further strengthening the partnership between our two companies - a partnership that has played an indispensable role in US-Russia nuclear cooperation for more than two decades".

The long-term contract with USEC was signed in March 2011 and provided for supply of uranium enrichment services of 21m separative work units (SWU) at a total cost of $2.8bn over 2013-2022. Tenex started supplying low enriched uranium (LEU) in 2013 and the amount was increased up to 2015, when it reached about one-half the level currently supplied by Tenex to USEC under the Megatons to Megawatts programme to downblend weapons-grade uranium, which was completed in December 2013.

The Megatons to Megawatts arrangement started in 1993, when the US and Russian governments signed an agreement for the purchase over a 20-year period of 500t of Russian 'surplus' high-enriched uranium (HEU) from nuclear disarmament and military stockpiles. These were to be downblended and bought by the USA for use as fuel in civil nuclear reactors. Under the deal, the USA transferred to Russia a similar quantity of natural uranium to that used to downblend the HEU.

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