American Centrifuge RD&D Program Achieves Second Milestone
American Centrifuge RD&D Program Achieves Second Milestone
USEC Inc.’s (NYSE: USU) American Centrifuge research, development and demonstration (RD&D) program recently accomplished the second of five technical milestones with Department of Energy certification of the successful completion of 20 years of centrifuge run-time on the commercial plant AC100 centrifuge machine.
Milestone Two affirmed the reliability of the Lower Suspension Drive Assembly (LSDA) which was upgraded in 2011. After achieving 20 years of run-time in May of this year, AC100 machines containing this upgraded subassembly continued accumulating hours and have now run for more than 30 machine years.
“The American Centrifuge machine continues to demonstrate robust and reliable performance as confirmation that it is ready for commercial deployment,” said John K. Welch, USEC president and CEO. “Our team remains focused on achieving the key performance and reliability milestones necessary to move this program to commercialization.”
Achieving Milestone Two confirms estimates of machine reliability in a commercial plant setting that supports the business case for the American Centrifuge Plant. The remaining three milestones of the RD&D program are expected to be met in late 2013.
“The board is pleased with the early accomplishments and overall direction of the RD&D program,” said Luis Reyes, executive director for operations (retired), U.S. Nuclear Regulatory Commission, and chairman of the American Centrifuge Demonstration, LLC board of managers. The board, made up of nuclear industry leaders, is charged with oversight and management of the RD&D program. “The RD&D program is progressing on schedule and on budget. The board will continue to work closely with the American Centrifuge program managers to build upon this success.”
Progress continues on the RD&D program, including continued manufacturing and conditioning of additional AC100 machines. Three of six service modules needed to support the full cascade have been installed, and work on additional balance of plant systems is progressing on schedule.
The objective of the RD&D program, a cooperative program jointly funded by the Department of Energy and USEC on an 80 percent / 20 percent basis, is to demonstrate the American Centrifuge technology through the construction and operation of a commercial plant configuration 120-centrifuge machine cascade and to sustain the domestic U.S. centrifuge technical and industrial base to ensure the capability exists to meet future national security needs. This includes activities to reduce the risks and improve the future prospects of commercial deployment of the American Centrifuge technology.
USEC intends to meet this objective through the construction and operation of the demonstration cascade and its supporting infrastructure. USEC will also demonstrate redundancy of the primary cascade support systems that will be used in a production plant, and will complete integrated testing against operational requirements. The RD&D cascade would be incorporated in the full commercial plant in Piketon, Ohio, which is planned to operate 96 identical cascades.
The RD&D program will support approximately 1,200 direct jobs in Ohio, Tennessee and several other states.
USEC Inc., a global energy company, is a leading supplier of enriched uranium fuel and nuclear industry related services for commercial nuclear power plants.
This news release contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934 – that is, statements related to future events. In this context, forward-looking statements may address our expected future business and financial performance, and often contain words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “will” and other words of similar meaning. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For USEC, particular risks and uncertainties that could cause our actual future results to differ materially from those expressed in our forward-looking statements include, but are not limited to: uncertainty regarding the timing, amount and availability of additional funding for the RD&D program and the dependency of government funding on Congressional appropriations; restrictions in our credit facility on our spending on the American Centrifuge project and the potential for us to demobilize the project; limitations on our ability to provide any required cost sharing under the RD&D program; the ultimate success of efforts to obtain a DOE loan guarantee and other financing for the American Centrifuge project, including the ability through the RD&D program or otherwise to address the concerns raised by DOE with respect to the financial and project execution depth of the project, and the timing and terms thereof; potential changes in our anticipated ownership of or role in the American Centrifuge project; the impact of actions we have taken or may take to reduce spending on the American Centrifuge project, including the potential loss of key suppliers and employees, and impacts to cost and schedule; the impact of delays in the American Centrifuge project and uncertainty regarding our ability to remobilize the project; changes in U.S. government priorities and the availability of government funding, including loan guarantees; and other risks and uncertainties discussed in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K and quarterly reports on Form 10-Q, which are available on our website www.usec.com. We do not undertake to update our forward-looking statements to reflect events or circumstances that may arise after the date of such statements except as required by law.
Paul Jacobson, 301-564-3399
Steven Wingfield, 301-564-3354