Uranium Enrichment Means Big Money
The key to expansion, after sufficient U3O8 has been mined, is ensuring the uranium is converted and enriched so that it can fuel nuclear power plants. Until now, U.S. utilities have relied upon Russian HEU to LEU supplies to fuel their nuclear reactors. Urenco's NEF in New Mexico gives a boost to the nuclear energy sector, and provides U.S. utilities with an alternative to having uranium enriched at USEC's Kentucky plant, or worse yet, shipping domestically produced uranium overseas for enrichment. For instance, Brazil was forced to have its uranium enriched in Europe, until recently.
Value-adding to the fuel supplying reactors can mean big money for LES, and especially for Urenco Ltd. But, the investment of $1.5 billion will also produce hundreds of new jobs for the border towns of both New Mexico and Texas. Estimates show about 800 construction jobs will be created as the facility is being built, and as many as 1200 during the peak of the construction. About 300 employees will be required to operate the facility. Nearby Andrews, Texas has been celebrating the National Enrichment Facility. The city manager expects the number of new homes under construction to jump by 10-fold this year. School enrollment has grown over the past year while newcomers have moved into the area, hoping for construction jobs.
Urenco's National Enrichment Facility should begin construction later this summer, probably in August. Louisiana Energy Services (LES) hopes to start selling enriched uranium in 2009, probably to its U.S. utility partners, who hope to build new reactors. A statement issued by the Nuclear Energy Institute (NEI) on Friday, congratulating LES for the approval of its NRC license pointed ahead to the U.S. expansion of the nuclear energy sector. The NEI's chief nuclear officer, Marvin Fertel, said, "This experience bodes well for the construction and operating license applications for new nuclear power plants that are expected to be submitted to the agency beginning in 2007."
James Finch contributes to StockInterview and other publications. Get your free copy of "Investing in the Great Uranium Bull Market" by visiting http://www.stockinterview.com for details.
