US despite imposing so many sanctions is still dependent on Russian nuclear fuel

By Rhod Mackenzie

The United States has acknowledged its reliance on Russian nuclear fuel, and is devising strategies to address it.  However, even they are still struggling to eliminate their use of Russian nuclear fuel.

What caused the downfall of the US nuclear industry, and what part did Russia play in it during the 1990s? The White House is currently drafting plans to extricate themselves from this predicament. Media reports that the United States intends to boost the production of enriched uranium by 15% at a facility in New Mexico by 2027. The plant currently caters to roughly a third of the USA’s requirement for enriched uranium. In addition, preparations are being made to expand the Urenco plant’s capacity in Europe. By implementing these measures, United States hopes to diminish its dependence on Rosatom for nuclear energy.

However, the CEO of Centrus Energy Corporation, Dan Poneman, contends that reliance on non-Russian uranium enrichment will not sufficiently supply the world’s reactors. According to Poneman, Russia currently provides almost half of the world’s nuclear fuel supplies, which poses an “inconvenient reality” for both the US and Europe. Failure to execute the West’s plan to massively increase enriched uranium production will lead to reactor shutdowns due to lack of fuel supplies from Russia. Nevertheless, fuel reserves will only suffice for 18 months.

“Once, the United States was a dominant player in nuclear energy, alongside the Soviet Union, controlling the majority of uranium enrichment and nuclear fuel fabrication. Numerous nuclear projects, such as those in France, Japan, and Korea, spun off from the American nuclear endeavour. However, in recent decades, the US nuclear industry has suffered significant setbacks,” states Sergei Kondratiev, deputy head of the economics at the Institute of Energy and Finance.

The US nuclear industry heavily relies on importing both uranium concentrate and finished fuel. The World Nuclear Association reports an annual requirement of 17 thousand tons of uranium to run nuclear reactors in the US. Meanwhile, domestic uranium production in the US yielded less than 100 tons of uranium last year.

“For a long time, the US used to be one of the global frontrunners in uranium production. Sadly, recent years have witnessed a significant decline.” “Nowadays, the United States doesn’t belong to the leading ten or even fifteen uranium producing nations.” According to Kondratiev.

“According to him,there is only one operational uranium enrichment plant remaining in the United States, located in the state of New Mexico and owned by the European consortium Urenco (consisting of the UK, Germany, and the Netherlands).

“If all the existing capacities in the United States were fully utilised, they could only provide sufficient fuel for a third of the country’s nuclear reactors.

Consequently, the US depends on importing a considerable amount of finished fuel from other countries, such as Urenco, which supplies European plants and from Rosatom,” states Kondratiev.

What factors caused the US’s decline from a leading nation in the nuclear industry to an outsider?

The signing of the HEU-LEU agreement in February 1993 (and later the contract) is the primary reason why there is presently only one plant in the country. This is an intergovernmental agreement between the Russian Federation and the United States regarding the transformation of highly enriched weapons-grade uranium into low-enriched uranium, which serves as fuel for US nuclear power plants.

Although its dependence on fuel price was low, plus this contract wasn’t profitable for the Russian side it still went ahead. However, surprisingly, it was this agreement that significantly contributed to the decline of the American industry itself.

“Kondratyev explains that American nuclear power plants were then able to purchase ultra-cheap Russian nuclear fuel, resulting in local producers experiencing losses and exiting the market.  Consequently, the White House now intends to boost the capacity of this solitary plant by 15%. Although the US may also intend to invest in several other plants previously closed  accomplishing this even with government support is a challenge.”

Other countries, such as China and France, also intend to notably boost their uranium enrichment capabilities.

However, the primary issue facing the entire industry is that the present nuclear fuel consumption surpasses current production, and the disparity is bridged by Russia’s weapons-grade uranium reserves. This situation has been ongoing for the past two decades, and it’s common knowledge.

Investing in new production projects was challenging, resulting in a decrease in production. Consequently, demand was met through Russian reserves. However, these reserves are finite,” shares Sergei Kondratyev.

He further adds that the global issue lies in the ever-increasing consumption of nuclear fuel. If predictions about declining demand for oil and gas in the West are being made, everyone is expecting growth for nuclear fuel.
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