WASHINGTON, Dec 10 (Reuters) - Russian exports of uranium to the United States to fuel nuclear power plants, would rise significantly starting around the middle of the next decade, under a draft agreement reached between the two countries.
For years, the U.S. government has restricted Russian uranium shipments, fearing Russia would dump uranium in the U.S. market and financially hurt major American-uranium supplier USEC Inc USU.N.
The higher Russian exports would be allowed at a time that market analysts believe uranium supplies will tighten in the 2011 to 2015 period, according to the Nuclear Energy Institute (NEI), the trade group for the U.S. nuclear industry.
The deal slowly increases Russian uranium exports over a 10-year period beginning in 2011, when shipments would be allowed to reach 16,559 tons.
Exports would then increase about 50 percent annually over the next two years and increase more than tenfold from 41,398 tons in 2013, when the current “Megatons to Megawatts” program expires, to 485,279 tons the next year.
Shipments would increase at much slower rates in each of the following six years until reaching 514,754 tons in 2020.
Under the “Megatons to Megawatts” program, enriched uranium from dismantled Russian nuclear weapons is imported by USEC and processed into fuel for American nuclear power reactors.
USEC spokeswoman Linda Johnson said the company does not object to the new deal as long as Russian uranium exports “do not jeopardize existing (USEC) facilities and the various projects now underway to modernize the U.S. fuel cycle and support a nuclear renaissance.”
The U.S. Commerce Department and the Russian State Atomic Energy Agency Rosatom reached the agreement in late November to allow more Russian uranium shipments.
Johnson said it is USEC’s understanding that in negotiating the deal, the Commerce Department worked to ensure the uranium market “remains stable...while at the same time meeting Russian interests in access to the U.S. market.”
However, Johnson would not say whether USEC is worried it may be difficult for the company to compete with the flood of Russian uranium shipments expected beginning in 2014.
“We’re still studying the agreement,” she said.
The terms of the deal were published last week in Federal Register of U.S. government regulations and policies, and will be open to public comment for 30 days. Final approval of the agreement is expected after a review of the comments received.
Owners and operators of U.S. nuclear power reactors bought 67 million pounds of uranium last year. About 16 percent of those purchases was of U.S.-origin and the other 84 percent, or 56 million pounds, cam from foreign suppliers, according to the Energy Department.
Uranium from Russian nuclear warheads under the “Megatons to Megawatts” program currently accounts for half of U.S. commercial reactor fuel, according to the NEI.
The new deal’s proposed annual uranium export limits were determined based on data from the World Nuclear Association’s global forecast for nuclear fuel.
The Commerce Department would adjust the export limits to match projected nuclear reactor demand in the group’s future forecasts.
Reporting by Tom Doggett; editing by Michael Roddy
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