March 17, 2014

USEC NEEDS MORE DOE FUNDING IN CR TO AVOID DEMOBILIZATION

By ExchangeMonitor

USEC officials told investors yesterday that with Congress planning for a six-month Continuing Resolution starting this fall, the company is hoping for additional funding from the Department of Energy starting in November to avoid a demobilization of the American Centrifuge Project. While USEC this week reported a net loss of $92 million in the second quarter of 2012 largely due to $85.7 million in American Centrifuge expenses, it also announced an infusion of $61.3 million from the Department into a cost-share program that is expected to carry it through November. USEC CEO John Welch said in yesterday’s investor call that in the case of a CR, DOE would be “earmarking money” to continue spending at the same level for the American Centrifuge program. “That’s being looked at by them right now. The fact that we have the program off and running is very good point as we enter into those kinds of discussions,” Welch said.

But given USEC’s financial position, work on the program would slow down without additional DOE funding. “We will be fully engaged both with Congress and the Department of Energy on our funding needs to ensure that there is no gap. Our position is that if there is not funding, we are very constrained for what we can spend ourselves and so we would likely have to go through some sort of demobilization. But there are options and actions that DOE has that can take the funding into the new year,” Welch said, adding, “It is in no one’s best interest to have any sort of interruption.”

Comments are closed.