In March 2011, Centrus' subsidiary United States Enrichment Corporation signed a multi-year supply contract with Joint Stock Company "TENEX" (TENEX) of Russia to replace the low enriched uranium fuel supply under the Megatons-to-Megawatts™ program, which concluded at the end of 2013. The new contract took effect in December 2011.
The new contract assures Centrus’ continued access to this important source of supply of low enriched uranium fuel for its customers during a transition period until Centrus builds out its American Centrifuge Plant in southern Ohio.
This contract complements those on-going activities and is mutually beneficial to Centrus and TENEX. It helps Centrus meet customer commitments, continues Centrus’ long-standing supply relationship with TENEX, and strengthens Centrus’ financial position as it moves forward with the American Centrifuge.
- The Transitional Supply Contract is a multi-year contract to purchase about 21 million separative work units (SWU) through 2022 with a mutual option to purchase up to another 25 million SWU during that period.
- Generally, Centrus is purchasing the SWU contained in the low enriched uranium and deliver natural uranium to TENEX for the low enriched uranium’s uranium component, though from time to time Centrus may also potentially agree with TENEX to purchase the uranium component.
- The low enriched uranium supplied by TENEX comes from Russia’s commercial enrichment activities rather than from downblending of excess Russian highly enriched uranium.
- The pricing terms for SWU under the contract are proprietary but are based on a mix of market-related price points and other factors.