US Awards US$2.7 Billion to Expand Domestic Uranium Enrichment

The US government on Monday (January 5) allocated billions of dollars to revive domestic uranium enrichment, accelerating Washington's efforts to reduce reliance on foreign supply.

The US Department of Energy (DOE) said it will award a total of US$2.7 billion over the next decade to three companies to provide enrichment services for low-enriched uranium (LEU) and high-assay low-enriched uranium (HALEU).

Both fuels are necessary to power the nation’s current nuclear fleet and support future advanced reactors.

“Today’s awards show that this Administration is committed to restoring a secure domestic nuclear fuel supply chain capable of producing the nuclear fuels needed to power the reactors of today and the advanced reactors of tomorrow,” Secretary of Energy Chris Wright said in the department’s statement.

American Centrifuge Operating and General Matter will each receive US$900 million to develop domestic HALEU enrichment capacity, while Orano Federal Services will receive US$900 million to expand US-based LEU enrichment.

The energy department said the funding will be distributed through task orders tied to specific performance milestones as part of an accountability framework designed to ensure delivery.

Enriched uranium, particularly HALEU, is processed to between 5 and 20 percent in U-235, and is considered essential for many advanced and small modular reactor designs.

Russia is the only country now producing HALEU at commercial scale. US funding to develop domestic HALEU supply was included in legislation passed last year that will fully ban Russian uranium imports by 2028.

The DOE said the expanded enrichment capacity is intended to support fuel needs for the nation’s 94 operating commercial reactors, while laying the groundwork for future deployments of advanced nuclear technologies.

The awards follow contracts signed last year with six companies; these firms were pre-qualified to bid on enrichment work tied to the federal program.

Alongside the enrichment awards, the DOE announced an additional US$28 million grant to Global Laser Enrichment, partly owned by Canada’s Cameco (TSX:CCO,NYSE:CCJ), to advance next-generation uranium enrichment technology.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.