Extending Global Laser's Limbo
Production has been affected by uranium prices which have generally trended downward since their peak of $135/lb in June 2007, the EIA said releasing the Uranium Marketing Annual Report.
Spot prices for uranium ore fell significantly in 2016, from $34.65/lb in January to $17.75/lb in November, the lowest monthly spot price since May 2004, before increasing to slightly more than $20/lb in December, the EIA noted, adding prices remained below $25/lb in the first quarter.
Apparently, that was not enough for investors interested in the restructuring of Global Laser Enrichment, the Wilmington NC-based joint venture of General Electric, Hitachi and Camco licensed by the U.S. Nuclear Regulatory Commission to use lasers to enrich uranium. (Click here for Global Laser equity details.)
In early April, Silex Systems Limited said GE Hitachi Nuclear Energy agreed to extend the restructuring talks for five months, to August 31. Under the agreement reached in April 2016, Silex – the Australian developer of Global Laser's technology -- has been seeking to replace the 76 percent stake held by GE and Hitachi.
Paducah's $1 billion mirage?
This second restructuring extension came days after Westinghouse Electric sought bankruptcy protection from the costs of building four nuclear reactors in Georgia and South Carolina, creating further nuclear industry uncertainty until Westinghouse files a business plan with the bankruptcy court. The company said later this is expected in July.
The extension also marked a further delay for the Paducah Laser Enrichment Facility, Global Laser's proposal to use laser technology to process tails stored at the site of the first U.S. enrichment operation, the Paducah Gaseous Diffusion Plant on the Ohio River in western Kentucky, which closed in 2013.
When proposed in 2013, western Kentucky officials put the investment needed to produce natural grade uranium from six decades of byproducts at $1 billion.
Meanwhile, U.S. production of U.S. uranium concentrate declined, dropping 40 percent between 2014 and 2016 to 2.9 million pounds U3O8 in 2016, the lowest annual total since 2005, the EIA said.
Production of uranium concentrate has remained low in 2017, totaling just 0.45 million pounds during the first quarter. If production were to remain at its first-quarter level for the entire year, annual production in 2017 would be the lowest level since 1952.
U.S. production of uranium concentrate, refined from uranium ore began in 1949 and grew rapidly throughout the 1950s, exceeding 35 million pounds per year by 1960. Production levels remained relatively high through the early 80s, reaching nearly 44 million pounds in 1980, the EIA said.
Since 1990, U.S. uranium concentrate production has averaged just over 4 million pounds per year. Domestic nuclear generation now relies heavily on foreign-origin uranium, much of which is enriched domestically. Over the period from 2012 to 2016, foreign-origin uranium made up nearly 90% of uranium purchases by owners and operators of U.S. civilian nuclear power reactors.
(There's more on the EIA's Uranium Marketing Annual Report at
GE began the Global Laser restructuring in June 2014, expressing frustration with the lack of growth in the nuclear fuel enrichment market.
Since taking on the effort a year ago, Silex has funded GE Hitachi's 76 percent of Global Laser’s ongoing operations while uranium producer Cameco continues to supply 24 percent of the venture's costs.
Silex said it expects to spend about AUD$6.5 million for the six months ending June 30 to fund ongoing laser development activities at Lucas Heights, Sydney and for its share of the Global Laser's Wilmington operations.
The team in Wilmington is focussed on scaling up separator and gas handling equipment in the Global Laser Test Loop facility in Castle Hayne, while the Silex team in Sydney continues to make good progress with the scaling up of the laser systems to commercial prototypes, it reported earlier this year.
These activities are expected to lead to a full scale demonstration with a prototype production module in 2020 at the Test Loop facility, Silex said.
Stating efforts to attract new investors in Global Laser are reaching advanced stages with a number of parties, Silex said it and GE Hitachi have been working on the transaction documentation that would formalize a sale of GE Hitachi’s 76 percent stake in Global Laser to Silex and other new shareholders.