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Urenco: New contracts, expansion planned

Nuclear Monitor Issue: 
#495
07/08/1998
Article

(August 7, 1998) Urenco plans to expand its enrichment capacity at its three enrichment plants in Capenhurst (UK), Gronau (FRG) and Almelo (the Netherlands) from the present 3.7 million swu to 4.5 million swu by the end of 2001. It booked many new contracts in Sweden, Japan, China, South Korea and the US and extended existing contracts in the UK and Germany, their home market.

(495.4897) WISE Amsterdam - This increase in capacity and new orders is explained by two factors: the trend of utilities to diversify its enriched uranium supply and the low price Urenco offers outside its home market. Only the Russian Techsnabexport is able to compete with Urenco. Urenco is accused of price dumping by the French Eurodif consortium and the USEC (United States' Enrichment Company), the two other large enrichment companies. The price of one of Urenco's latest contracts, with the South Korean Kepco utility, was only US$83/swu (swu= separation work unit. To enrich 1 kg of natural uranium with 0.7% uranium-235 to 4% U-235, about 5 swu is needed). The US price is about US$120/swu, the Russian price about US$75-$80/swu.

The Gronau site was recently licensed to expand its capacity from 1 million swu to 1.8 million swu. In the UK, the A-3 plant which had been on stand-by for many years, is now brought into active operation with a production capacity of about 0.5 million swu by 2001. Urenco plans to enlarge its recent share of ±15% of the global enrichment market to 25% by 2005. As the total market does not grow, Urenco has to capture market shares from Eurodif and USEC in East Asia and elsewhere as it did last years and is expected to continue to do so.
Very recently, the Dutch government sanctioned the swu supply by Urenco to Taiwan. British and German governments consented first. A special agreeement between the US, the IAEA and Taiwan is needed, to make IAEA safeguards inspections possible, because Taiwan is not recognized by the UN or IAEA as a state and is no member to the Non-Proliferation Treaty. Under two agreements, Infcirc-113 and Infcirc-158, the US is directly responsible for facilitating IAEA safeguards in Taiwan. Urenco has urged its three sponsoring governments for years to make diplomatic arrangements with the US and the IAEA. Urenco denied press accounts, which suggested a swu contract was already signed with Taipower, the Taiwanese utility. Taipower has made no firm commitment yet, bur remains in discussion with Urenco. It will decide by end 1998 whether to sign a contract with Urenco for 10% to 20% of its swu requirements after 2002, when the two Lungmen reactors will start operation.

Source:Nuclear Fuel, 18 May and 13 July 1998.
Contact: Joop Boer at WISE Amsterdam