Cleanup of a former gaseous diffusion plant in Ohio would be underfunded by nearly $80 million on an annualized basis and layoffs will be imminent if Congress does not increase funding for the project next week, an Energy Department contractor said Thursday.
The cleanup, funded under a 10-year, $2.6 billion contract with Fluor-BWXT, depends not only on Congress’ annual appropriations, but on a uranium barter agreement under which the company receives uranium from a government stockpile and sells it on the open market to pay for decontamination and decommissioning at DOE’s Portsmouth Site — and uranium prices are falling.
“The last six to nine months have seen a significant drop in the spot market price for uranium,” Fluor-BWXT spokesman Jeff Wagner said by email Thursday. “Many analysts forecast this soft market to continue throughout fiscal year 2017.”
Meanwhile, On the appropriations side, the White House requested a 14-percent year-over-year funding increase for Portsmouth in fiscal 2017, to about $255 million. The next budget year begins on Oct. 1. The 2017 appropriations process stalled out this summer, so Congress has as of Friday one more week to pass a short-term continuing resolution that would keep the federal government funded at 2016 levels until Dec. 9.
Absent an increase in the annual appropriation — which Congress could pay for by shifting funds out of programs in the federal budget that can make do with a smaller appropriation under the stopgap bill — slumping spot prices for uranium “would create an estimated $78 million deficit in operating funds for the full fiscal year 2017,” Wagner said.
Fluor-BWXT has 1,830 personnel at Portsmouth, including subcontractors, plus an additional 40 to 75 construction subcontractors for decontamination and decommissioning and work, Wagner said.
With the uranium shortfall and assuming no funding increase next week, Fluor-BWXT would have to make do with some $13 million less than it needs at Portsmouth for the two months of work the continuing resolution would fund.
In that worst-case scenario, the company “would have to move quickly toward a workforce restructuring action,” Wagner said. He would not provide an exact figure, giving the standard response that it would depend on which work DOE wanted to prioritize in such a scenario.
Among the projects that would suffer are the on-site waste disposal facility Fluor-BWXT is building to store debris generated by planned decontamination and decommissioning of the former uranium enrichment infrastructure at the Pike County site.
Uranium prices are perpetual problem for DOE, which year after year must seek changes to Portsmouth’s annual appropriation to make up for fluctuations in commodities markets. This has led to several budget scares at Portsmouth.
However, Fluor-BWXT is confident it will be made whole, or at least close to it, thanks to the efforts of Ohio’s congressional delegation this month.
Members of the House and the Senate have gone to bat for Portsmouth this month, most recently Reps. Brad Wenstrup (R-Ohio) and Bill Johnson (R-Ohio). In a letter dated Sept. 19 and delivered on Wenstrup’s stationary, the two asked the leadership of the House Appropriations Committee and its energy and water subcommittee to shift funding within the continuing resolution to cover Portsmouth’s fiscal 2017 bills.
“[W]e want to ensure that a short-term CR does not have negative long-term consequences for the workers at Portsmouth and the Piketon community,” Wenstrup and Johnson wrote in the letter, which Wenstrup posted on his website.
Earlier in September, Sens. Rob Portman (R-Ohio) and Sherrod Brown (D-Ohio) made a similar plea for Portsmouth funding in a letter to the leadership of the Senate Appropriations Committee.
In appropriations debate this spring, lawmakers went beyond the Obama administration’s requested $255 million, with the Senate approving almost $265 million for Portsmouth and the House approving more than $270 million.
The Portsmouth Gaseous Diffusion Plant enriched uranium for the Pentagon’s nuclear weapons during the Cold War, and for commercial power plants.
