The amendment, which was entered into in February, implements a new pricing methodology for deliveries of low enriched uranium (LEU) from TENEX starting in 2010 and continuing through the end of the contract in 2013, said the agency.
The new pricing methodology is intended to enhance the stability of future pricing for both parties through a formula that combines a different mix of price points and other pricing elements from the previous methodology. The US government approved the contract amendment on April 2nd and the government of the Russian Federation approved it on July 11th.
The new pricing strategy also comes at a time that prohibitive tariffs for Russia to import uranium to the US at full market value have been lifted. Four US utilities already have deals to buy uranium privately from Russia.
Ironically, Rusia already supplies some 40 percent of the uranium used in US reactors through the Megatons to Megawatts programme. The new sweeping away of the tariffs will mean an even bigger market share for Russian uranium in the US, Tenex hopes.
The Megatons to Megawatts program is a unique, commercially financed government-industry partnership in which 500 metric tons of weapons-grade uranium from dismantled Russian nuclear warheads are being recycled into LEU used to produce fuel for American nuclear power plants. USEC, as executive agent for the US government, and TENEX, acting for the Russian government, implement this 20-year program, USEC said in a statement.
As of June 30, 2009, 367 metric tons of weapons-grade highly enriched uranium from Russian nuclear warheads had been recycled into 10,621 metric tons of LEU, equivalent to 14,686 nuclear warheads eliminated, USEC reported.
USEC Inc., a global energy company, is a leading supplier of enriched uranium fuel for commercial nuclear power plants.