The Department of Energy could award a contract to operate a small, Centrus Energy-built uranium enrichment cascade at the agency’s Portsmouth site in Ohio this month, the company’s CEO said Wednesday on a quarterly earnings call.
“The Department has indicated in a recent industry briefing that a decision could come as early as this month,” Daniel Poneman, chief of Bethesda, Md.-based Centrus, told investors on the early-November third-quarter earnings call.
In June, DOE solicited bids for a notionally open competition to complete and operate the 16-machine cascade of Centrus’ AC100M centrifuges that the company began building for DOE under a sole-source contract awarded in 2019.
Centrus submitted its bid for the follow-on in August, Poneman said Wednesday. DOE has not said how many other bids, if any, it received for the potentially 10-year contract to produce up to 900 kilograms of energy-dense uranium fuel. Centrus’ sole-source deal, an 80-20 cost share with DOE taking the lion’s share, is worth about $140 million and was to expire this month.
Centrus’ cascade will produce high assay low enriched uranium (HALUE) which contains just under 20% of the Uranium-235 isotope: slightly below the threshold of what by international convention is considered highly enriched.
Building the cascade has given Centrus a chance to hone both the AC100 technology and to bug shake the domestic supply chain for enrichment centrifuges at a time when DOE is mulling how it will enrich uranium for nuclear weapons and the Navy’s submarines and warships. DOE, which needs a new enrichment source by the 2050s or so, says it can only use domestically sourced uranium enriched by machines built entirely in the U.S. with domestic components for defense programs.
Meanwhile, Centrus had a net loss of about $6 million, or $0.42 a share, in the third quarter, down from net earnings of about $42 million a year ago, when the company had a nonrecurring windfall from a pension settlement with the federal government.
Centrus’ quarterly revenue was $33.2 million, down from $91.3 million a year ago. Aside from the drop-off related to the pension settlement, book kept in the Technical Services segment, the company’s bedrock uranium brokerage unit, the LEU segment, saw revenue drop by almost $12 million year-over-year to a little over $20 million. Centrus blamed lower enriched-uranium prices.
The LEU segment is prone to drastic ups and downs from quarter to quarter because different power plants order their fuel at different times.
