- Oak Ridge selected as the preferred site for a new enrichment facility, company’s multi-billion-dollar project represents single largest investment in Tennessee history
The uranium enrichment center will be a multi-structure commercial production site covering approximately 750,000 square feet (17 acres) making it one of the largest facilities of its kind in North America.
In a telephone interview with Curtis Roberts, Orano Senior Director of Communications, explained it will be a while before centrifuges start spinning at the site. Jean-Luc Palayer, CEO and president of Orano USA, said in a media statement in Tennessee that the plant is planned to be up and running in the early 2030s.
The first challenge is to complete acquisition of the site which is a process that has several moving pieces before the company gains control of the land. The 920-acre parcel of land set to be donated by the U.S. Department of Energy to the city and then transferred to Orano USA at no cost.
The project is being aided by money allocated from a $50 million Nuclear Energy Fund, which assists nuclear energy-related businesses choosing to relocate or grow in Tennessee and supports the state’s universities and research institutions in further developing their nuclear education programs.
According to the Knoxville News, in resolutions unanimously approved by the Oak Ridge City Council and Industrial Development Board in special morning meetings on 09/04/24, the governing bodies supported a 50% tax increment financing deal over 40 years. The incentive allows Orano USA to hold the deed to the land during the lengthy regulatory process.
Major Questions Abound for Now ~ Answers Will Be in the Future
At this time most of the major questions about development of the project have answers that are still in the future. No timeline has been set for submitting a license application to the Nuclear Regulatory Commission for the plant although it is an early priority.
According to Roberts, Orano will assess market conditions to determine the size and production capacity of the first phase of the plant, with options for additional phases if there is a well defined market for the product.
Orano CEO Palayer said one of his early priorities is to secure customer commitments to pay for the enriched product that will be produced by the plant.
Roberts said that Orano will produce commercial quantities of low enriched uranium up to 5% U235 and some with higher enrichment levels up to 8% U235. There are no plans for now to produce high assay low enriched uranium (HALEU) needed for advanced reactors.
After leaving the plant in a gaseous form as uranium hexafluoride (UF6), the product goes to conversion plant to be turned into solid form, and then is shipped to fuel fabrication plants to make various forms of uranium fuel and package it according to the specifications of each nuclear utility for their reactors.
Supply Chain for the Enrichment Plant
In terms of the supply chain, e.g., where the uranium will come from to be enriched, Roberts said that U.S. and international suppliers, including Canadian sources, will be part of the mix. The US has only one hard rock uranium mill, located in Utah, but uranium operations from in-situ mining in western US states, which also produce yellowcake, are expanding production due to the higher price of it compared to a decade ago. Uranium does not trade on an open market like other commodities. Buyers and sellers negotiate contracts privately.
According to data from Cameco, Canada’s largest uranium miner, the spot price for uranium has been falling since January of this year from a high of $100.25/lb to $78.50/lb in August. However, long term contracts have risen from $72.00/unit in January 2024 to $81.00/lb in August.
According to Trading Economics, investors continued to assess US capacity for producing enriched uranium after the ban on imports of Russian nuclear fuel, which was responsible for over half of global supply before the fallout in trade following Russia’s invasion of Ukraine in 2022.
On the demand side, Trading Economics reported “China leads the nuclear energy bets,” currently building 22 of 58 global reactors, and Japan is restarting existing reactors as well as committing to complete plants that were under construction prior to the 2011 Fukushima crisis.
Cost and Financing
In terms of financing the project, Roberts said that only preliminary contacts have been made with the DOE Loan Program Office, and no formal discussions are taking place at this time.
In in 2012 Areva laid plans to build a $3 billion uranium enrichment plant in Idaho, and scored a $2 billion loan guarantee from the Department of Energy. Roberts said that project and the financing for it have long since been closed out. A new plant the size of the one contemplated by Areva would cost a good deal more given inflation of prices for steel, concrete, and other materials needed for the plant.
U.S. Government Uranium Supply Programs
Roberts also noted that Orano’s initiative is consistent with the U.S. government’s policy to reduce dependence on Russian uranium to fuel nuclear power plants here. According to the office of U.S. Rep. Chuck Fleischmann, whose district includes Oak Ridge, Congress has appropriated $2.8 billion to enrich uranium to make nuclear fuel for US commercial reactors. Orano, along with Centrus and Urenco, have submitted proposals for the funding. Fleischmann told Knox News the proposals could be funded by the Department of Energy this month.
Once built facility operations will create more than 300 new direct jobs in the immediate area. Orano CEO Jean-Luc Palayer praised the cooperation of all levels of government in Tennessee as well as the direct involvement of state and area economic development organizations and the Tennessee Valley Authority, which will provide power for the enrichment plant.
About Orano
Orano USA, is a world leader in the nuclear fuel supply chain with uranium mines in Canada, Kazakhstan and and other countries. With U.S. headquarters in Bethesda, Maryland, and global headquarters in Paris, France, Orano is a leading technology and services provider for the commercial and federal nuclear industries. The company specializes in uranium mining/conversion/enrichment, used nuclear fuel management and recycling, decommissioning shutdown nuclear energy facilities, federal site clean-up and closure and developing nuclear medicines to fight cancer.
Stages of the Nuclear Fuel Cycle
Text and graphics courtesy of U.S. Nuclear Regulatory Commission
The nuclear fuel cycle represents the progression of nuclear fuel from creation to disposal. In the United States, uranium is processed in different chemical and physical forms to create nuclear fuel. Mixed oxide is another type of nuclear fuel. As illustrated below, the nuclear fuel cycle typically includes the following stages:
- Uranium recovery to extract (or mine) uranium ore, and concentrate (or mill) the ore to produce a uranium ore concentrate, sometimes called U3O8 or “yellowcake“
- Conversion of uranium ore concentrate into uranium hexafluoride (UF6)
- Enrichment to increase the concentration of uranium-235 (U235) in UF6
- Deconversion to reduce the hazards associated with the depleted uranium hexafluoride (DUF6), or “tailings,” produced in earlier stages of the fuel cycle
- Fuel fabrication to convert natural and enriched UF6 into UO2 or uranium metal alloys for use as fuel for nuclear reactors. This step also includes mixed oxide fuel fabrication.
- Use of the fuel in reactors (nuclear power, research, or naval propulsion)
- Interim storage of spent nuclear fuel
- Reprocessing (or recycling) of high-level waste (currently not done commercially in the U.S.)[1]
- Final disposition (disposal) of used fuel or high-level waste
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