Probably the reason for the sell off. Not what I was looking for, but they are still moving forward.
BETHESDA, Md. (Business Wire) -- USEC Inc. (NYSE: USU) today announced that the company and the U.S. Department of Energy (DOE) are engaged in advanced but ongoing discussions regarding the future of the American Centrifuge project, an innovative technology approach to domestic uranium enrichment that can both meet commercial needs and provide potential national security benefits.
USEC and DOE remain committed to moving forward on commercializing this innovative technology and have been in discussions to work jointly in a Research, Development and Demonstration (RD&D) program to reduce the technology and financial risk of commercialization of the American Centrifuge technology. The RD&D program is expected to involve manufacturing and operating additional production-design machines so that key systems can be tested as they would actually operate at the scale necessary for full commercialization.
Contemplated in the discussions is a cost-sharing agreement for the RD&D program. The cost share would consist of an 80%-20% federal-private split during an initial technical verification phase and a 20%-80% split for the balance of the RD&D program. The federal government's total contribution would be capped at $300 million.
“We are pleased with the significant progress made in our discussions with DOE,” said John Welch, president and CEO of USEC. “DOE, USEC and our partners remain supportive of a path to commercializing the American Centrifuge and believe additional work demonstrating this innovative technology would be beneficial to the project.
“This preserves a path for USEC and our shareholders to obtain value from the investment they have made in the American Centrifuge project,” concluded Welch.
USEC is working with its strategic investors to determine how best to structure ongoing investment in the project and move forward with this RD&D program and future commercialization. Should an agreement on the RD&D program and funding be reached, further demobilization of the American Centrifuge project would be avoided.
While no final decision on USEC's loan guarantee application has been made at this time, USEC and DOE's discussions are focused on this RD&D program to reduce technical and financial risks associated with the project. USEC's loan guarantee application will remain pending during implementation of this agreement, however, there can be no assurances that these discussions will result in an agreement or funding for the American Centrifuge project.
USEC Inc., a global energy company, is a leading supplier of enriched uranium fuel and nuclear industry related services for commercial nuclear power plants.
Forward-Looking Statements
This news release contains forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995) that involve risks and uncertainty. For USEC, particular risks and uncertainties that could cause our actual future results to differ materially from those expressed in our forward-looking statements include, but are not limited to: risks related to the deployment of the American Centrifuge technology, including risks related to performance, cost, schedule and financing; the outcome of ongoing discussions with DOE regarding the RD&D program, including uncertainty regarding the timing, amount and availability of funding for such RD&D program and the dependency of government funding on Congressional appropriations; the impact of any conditions that are placed on the Company or on the American Centrifuge project in connection with or as a condition to any RD&D program or other funding; the effects on the Company of its limited ability to continue to invest in the American Centrifuge project absent the RD&D program or other funding and the potential for demobilization or termination of the project; limitations on the Company's ability to provide any required cost sharing under the RD&D program; the ultimate success of efforts to obtain a DOE loan guarantee for the American Centrifuge project, including the ability through the RD&D program or otherwise to address the concerns raised by DOE with respect to the financial and project execution depth of the project, and the timing and terms thereof; any effect on the remaining two phases of the three-phased investment by Toshiba Corporation and Babcock & Wilcox Investment Company; and other risks and uncertainties discussed in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K and quarterly reports on Form 10-Q, which are available on our website www.usec.com. We do not undertake to update our forward-looking statements to reflect events or circumstances that may arise after the date of such statementsexcept as required by law.
