Tuesday, June 27, 2006

The Crisis in American Uranium Enrichment.

We have heard endless tales about India's lack of Uranium enrichment skills and facilities. We are all well versed with M. V. Ramana's articles.

But what is the story in the US?

As you all know that Uranium production is measured in terms of something called "separative work units (SWU)". The more enriched the uranium you want - the more SWU it needs.

Enrichment in the US was the effective monopoly of the US Enrichment Corporation (USEC). This Public Sector Undertaking (PSU) (originally under US DOE) used to operate plants at Paducah (Kentucky) , Portsmouth (Ohio) and Oak Ridge (Tennessee). The USEC's had a total capacity of about 27 Million SWU all based on gaseous diffusion plants.

The USEC represented about 40% of the world's production of enriched Uranium. The USEC was identified by the George H. W. Bush administration as an ideal candidate for privatization. However the privatization process faltered in the Clinton era and it took ten years after the idea was first mooted to actually privatize the corporation. Though it was privatized, it still retained many of the privileges enjoyed by its parent entity. The most glaring of these was that its plants used to get free electricity (approximately 3GWe at peak capacity) for running gaseous diffusion processes. This indirect subsidy ensured that the cost of producing Uranium at USEC facilities was about $ 60/SWU. To give you a number to compare that with - Reliance Corporation's proposed Natural Gas fired power plant at Dadri will produce about 3 GWe. The USEC sold its enriched Uranium at the market price - about $100/SWU - a tidy ~ 80% profit. USEC was also involved in an intitiave pioneered by Senators Sam Nunn and Richard Lugar. This initiative ensured that Russia downblended some 500 Metric tonnes of its Highly Enriched Uranium (used in nuclear weapons) and supplied it to the USEC as feedstock for its enrichment lines. The USEC would "purchase" this stuff from the russians at ~ $88/SWU and complain endlessly about the loss of profit margin. They even wanted to be re-imbursed by the US taxpayer - talk about a scam.

By comparison Urenco's gas centrifuge plants consume about 5% of the electricity that the diffusion plants consume. Just recently on June 24, 2006, the US NRC finally gave Urenco the license to build a Gas Centrifuge plant in Eunice NM. This is despite the fact that USEC has control over the AVLIS technology developed at LLNL. This technology is supposed to be superior to Urenco's stuff but the fact is that Urenco's gas centrifuges are now more/atleast as reliable as AVLIS. Bear in mind that the diffusion plants were chosen because they were reliable while Urenco's centrifuges were slandered for being "unreliable" and "sporadic" in their functioning. I bet a month's pay that is complete BS.

The US reactor industry produces a sizable fraction (~ 30%) of America's energy needs (I don't know if this number includes the reactors that the US armed forces use). These reactors need about 14-15 million SWU per year. And one of the reasons why new reactors weren't constructed is because oil based energy was far cheaper to exploit. Now ofcourse everyone wants to move to nuclear power and that means someone has to make more Uranium - and that too cheap. A drag like USEC's gas diffusion methods - no matter the excess capacity that they have - is simply not worth the expenditure.

So today USEC market share is shrinking. Urenco is expanding rapidly to seize the US market - and oh those Pakistanis - who stole Urenco designs and made Pak-1 and Pak-2 centrifuges are actually making a Uranium enrichment machine that is superior to the ones the Americans have!

I can't imagine that Americans who think of themselves as world leaders in technology feel very happy about being less advanced than the Pakistanis. Maybe A Q Khan can redeem himself by selling America Pak-2 centrifuges?

Is it any surprise that the NPA are clamoring about the RMP-Rattehalli enrichment facility?

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