USEC Achieves American Centrifuge RD&D Milestones

December 20, 2013

BETHESDA, Md. – USEC Inc. (NYSE:USU) announced that over this past weekend a full production-scale cascade of 120-machines achieved 20-machine years of operations at commercial plant specifications. During that performance run, USEC successfully completed three important milestones set by the Department of Energy (DOE) for the American Centrifuge research, development and demonstration (RD&D) program.

“The demonstration cascade is operating as expected, exceeding the SWU production, machine availability and cascade performance criteria established by DOE,” said John K. Welch, USEC president and chief executive officer. “Our teams in Oak Ridge and Piketon rose to the challenge of the RD&D program and are showing once again why they are considered to be the best in the world.

“The RD&D program is designed with DOE to demonstrate the technological readiness of the American Centrifuge to meet national security needs,” added Welch. “We continue to work with DOE and the Congress to determine the American Centrifuge’s role in meeting those needs as we continue to pursue the development and deployment of this important technology.”

The June 2012 cooperative agreement, as amended, that established the RD&D program with DOE includes nine technical milestones for the RD&D program. Six of the milestones have been completed and certified by DOE. The remaining three milestones that have just been completed, subject to DOE certification, involve demonstrating centrifuge manufacturing quality, centrifuge operational reliability and demonstration of sustained production of 340 SWU at commercial conditions for 20-machine years.

Complete documentation supporting successful completion of these three milestones will be submitted to DOE within the month for certification. The RD&D program will continue while USEC completes additional testing with the cascade and a mandatory NRC-required annual inventory of uranium hexafluoride process gas. An independent board of managers provides oversight for the program.

The deployment of the American Centrifuge technology would ensure that the United States has its own indigenous uranium enrichment technology to meet national security needs. With the recent cessation of enrichment at the gaseous diffusion enrichment facility in Paducah, Ky., the United States for the first time in more than 60 years is without its own technology in operation to enrich uranium and today is completely dependent on foreign-controlled technologies for the production of new nuclear fuel that generates almost 20 percent of America’s electricity.

The cooperative agreement, which has been incrementally funded, provides for 80 percent DOE and 20 percent USEC cost sharing for work performed during the period June 1, 2012 through January 15, 2014. On November 20, 2013, USEC and DOE entered into an amendment to the cooperative agreement for an additional $15.7 million in government funding for the funding period November 2 to January 15, 2014, bringing total government funding to $256.9 million. The RD&D program remains under budget and within schedule.