80 FR 65727 - Excess Uranium Management: Secretarial Determination of No Adverse Impact on the Domestic Uranium Mining, Conversion, and Enrichment Industries

DEPARTMENT OF ENERGY
National Nuclear Security Administration

Federal Register Volume 80, Issue 207 (October 27, 2015)

On August 2, 2015, the Secretary of Energy issued a determination (``Secretarial Determination'') covering the sale or transfer of high-assay low enriched uranium for medical isotope development projects. The Secretarial Determination covers transfers of up to 25 kilograms uranium (kgU) per year of low enriched uranium (LEU) at up to 19.75 percent uranium-235 for transfers in the two years following approval of the determination to support molybdenum-99 producers in commercial research and isotope production applications. For the reasons set forth in the Department's ``Analysis of Potential Impacts of Uranium Transfers on the Domestic Uranium Mining, Conversion, and Enrichment Industries,'' which is incorporated into the determination, the Secretary determined that these transfers will not have an adverse material impact on the domestic uranium mining, conversion, or enrichment industry.

[Federal Register Volume 80, Number 207 (Tuesday, October 27, 2015)]
[Notices]
[Pages 65727-65730]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-27303]


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DEPARTMENT OF ENERGY

National Nuclear Security Administration


Excess Uranium Management: Secretarial Determination of No 
Adverse Impact on the Domestic Uranium Mining, Conversion, and 
Enrichment Industries

AGENCY: National Nuclear Security Administration, Department of Energy

ACTION: Notice.

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SUMMARY: On August 2, 2015, the Secretary of Energy issued a 
determination (``Secretarial Determination'') covering the sale or 
transfer of high-assay low enriched uranium for medical isotope 
development projects. The Secretarial Determination covers transfers of 
up to 25 kilograms uranium (kgU) per year of low enriched uranium (LEU) 
at up to 19.75 percent uranium-235 for transfers in the two years 
following approval of the determination to support molybdenum-99 
producers in commercial research and isotope production applications. 
For the reasons set forth in the Department's ``Analysis of Potential 
Impacts of Uranium Transfers on the Domestic Uranium Mining, 
Conversion, and Enrichment Industries,'' which is incorporated into the 
determination, the Secretary determined that these transfers will not 
have an adverse material impact on the domestic uranium mining, 
conversion, or enrichment industry.

FOR FURTHER INFORMATION CONTACT: Mr. Randy Howell, NNSA Mo-99 Domestic 
Project Support, U.S. Department of

[[Page 65728]]

Energy, 1000 Independence Avenue SW., Washington, DC 20585, telephone 
202-586-8834, or email [email protected].

SUPPLEMENTARY INFORMATION: The Department of Energy (DOE) holds 
inventories of uranium in various forms and quantities--including low-
enriched uranium (LEU) and natural uranium--that have been declared as 
excess and are not dedicated to U.S. national security missions. Within 
DOE, the Office of Nuclear Energy (NE), the Office of Environmental 
Management (EM), and the National Nuclear Security Administration 
(NNSA) coordinate the management of these excess uranium inventories. 
NNSA down-blends excess highly-enriched uranium to high-assay low-
enriched uranium--above the commercial level of 5 wt-% and up to about 
19.75 wt-% of the isotope U-235--in support of its nonproliferation 
objectives and missions. Common applications of such high-assay 
materials are as fuels for domestic and foreign research reactors and 
as target materials for the production of medical isotopes.
    This notice involves high-assay LEU transfers of this type to 
support molybdenum-99 producers in either and/or both of the above 
applications. These transfers fulfill a directive in the American 
Medical Isotope Production Act of 2012 (Pub. L. 112-239, Division C, 
Title XXXI, Subtitle F, 42 U.S.C. 2065) for the Department to carry out 
a program of assistance for the development of fuels, targets, and 
processes for domestic molybdenum-99 production that do not use highly 
enriched uranium. These transfers also support U.S. nuclear 
nonproliferation initiatives, by providing a path for down-blended 
highly enriched uranium (HEU) and encouraging the use of LEU in civil 
applications in lieu of HEU.
    These transfers are conducted in accordance with the Atomic Energy 
Act of 1954 (42 U.S.C. 2011 et seq., ``AEA'') and other applicable law. 
Specifically, Title I, Chapters 6, 14, of the AEA authorize DOE to 
transfer special nuclear material; LEU is a type of special nuclear 
material. The USEC Privatization Act (Pub. L. 104-134, 42 U.S.C. 2297h 
et seq.) places certain limitations on DOE's authority to transfer 
uranium from its excess uranium inventory. Specifically, under section 
3112(d)(2)(B) of the USEC Privatization Act (42 U.S.C. 2297h-
10(d)(2)(B)), the Secretary must determine that the transfers ``will 
not have an adverse material impact on the domestic uranium mining, 
conversion or enrichment industry, taking into account the sales of 
uranium under the Russian Highly Enriched Uranium Agreement and the 
Suspension Agreement'' before DOE makes certain transfers of natural or 
low-enriched uranium under the AEA.
    On August 2, 2015, the Secretary of Energy issued a determination 
(``Secretarial Determination'') covering the sale or transfer of high-
assay low enriched uranium for medical isotope development projects. 
The Secretarial Determination covers transfers of up to 25 kilograms 
per year of LEU at up to 19.75 percent uranium-235 for transfers in the 
two years following approval of the determination to support 
molybdenum-99 producers in commercial research and isotope production 
applications. The Secretary based his conclusion on the Department's 
``Analysis of Potential Impacts of Uranium Transfers on the Domestic 
Uranium Mining, Conversion, and Enrichment Industries,'' which is 
incorporated into the determination. The Secretary considered, inter 
alia, the requirements of the USEC Privatization Act of 1996 (42 U.S.C. 
2297h et seq.), the nature of uranium markets, and the current status 
of the domestic uranium industries, as well as sales of uranium under 
the Russian HEU Agreement and the Suspension Agreement.

    Issued in Washington, DC.
Anne M. Harrington,
Deputy Administrator for Defense Nuclear Nonproliferation, National 
Nuclear Security Administration.
    Set forth below is the full text of the Secretarial Determination.

SECRETARIAL DETERMINATION FOR THE SALE OR TRANSFER OF URANIUM

    I determine that the transfer of up to the equivalent of 25 kgU of 
19.75%-assay low enriched uranium per calendar year to support the 
development and demonstration of molybdenum-99 production capabilities 
will not have an adverse material impact on the domestic mining, 
conversion, or enrichment industry. I base my conclusions on the 
Department's ``Analysis of Potential Impacts of Uranium Transfers on 
the Domestic Uranium Mining, Conversion, and Enrichment Industries,'' 
which is incorporated herein. As explained in that document, I have 
considered, inter alia, the requirements of the USEC Privatization Act 
of 1996 (42 U.S.C. 2297h et seq.), the nature of uranium markets, and 
the current status of the domestic uranium industries. I have also 
taken into account the sales of uranium under the Russian HEU Agreement 
and the Suspension Agreement.

Date: August 2, 2015.

Ernest J. Moniz,

Secretary of Energy

Analysis of Potential Impacts of Uranium Transfers on the Domestic 
Uranium Mining, Conversion, and Enrichment Industries

I. Introduction

A. Legal Authority

    DOE manages its excess uranium inventory in accordance with the 
Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq., ``AEA'') and related 
statutes. Specifically, Title I, Chapters 6-7, 14, of the AEA authorize 
DOE to transfer special nuclear material and source material. LEU and 
natural uranium are types of special nuclear material and source 
material, respectively.
    The USEC Privatization Act (Pub. L. 104-134, 42 U.S.C. 2297h et 
seq.) places certain limitations on DOE's authority to transfer uranium 
from its excess uranium inventory. Specifically, under section 3112(d) 
of the USEC Privatization Act (42 U.S.C. 2297h-10(d)), DOE may make 
certain transfers of natural or low-enriched uranium if the Secretary 
determines that the transfers ``will not have an adverse material 
impact on the domestic uranium mining, conversion or enrichment 
industry, taking into account the sales of uranium under the Russian 
Highly Enriched Uranium Agreement and the Suspension Agreement.'' (42 
U.S.C. 2297h-10(d)(2)(B)). The validity of any determination under this 
section is limited to no more than two calendar years subsequent to the 
determination (see Section 306(a) of Division D, Title III of the 
Consolidated and Further Continuing Appropriations Act, 2015 (Pub. L. 
113-235)).

B. Transfers Considered in This Determination

    The American Medical Isotopes Production Act of 2012 (Pub. L. 112-
239, Division C, Title XXXI, Subtitle F, 42 U.S.C. 2065) directs the 
Department to carry out a program to provide assistance for the 
development of fuels, targets, and processes for domestic molybdenum-99 
production that do not use highly enriched uranium (HEU). The transfer 
of small quantities of high-assay low enriched uranium (LEU) (LEU 
enriched above 5 wt-%, but below 20 wt-% U-235) is appropriate and 
necessary to assist parties engaged in research and development (R&D) 
and

[[Page 65729]]

commercial demonstrations of the aforementioned fuels, targets, and 
processes. Material transfers under this determination will occur 
primarily during calendar years 2015 and 2016 and consist of no more 
than 25 kgU of material enriched at up to 19.75 wt-% of the isotope U-
235 in any calendar year.\1\ Assuming a tails assay of 0.20 wt-% U-235, 
it would require approximately 1 MTU of natural uranium hexafluoride 
and approximately 1,100 separative work units (``SWU'') to produce that 
quantity of 19.75 wt-% LEU.
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    \1\ If any transfers include material at an assay other than 
19.75 wt-%, the amount will be converted so that the total amount in 
any calendar year is equivalent to no more than 25 kgU at 19.75 wt-
%.
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II. Analytical Approach

    Consistent with the analytical approach outlined in the 
Department's prior Analysis of Potential Impacts of Uranium Transfers, 
80 FR 26,366, 26,379-84 (May 7, 2015), this analysis evaluates two 
forecasts: one reflecting the state of the domestic uranium industries 
if DOE goes forward with the transfer and one reflecting the state of 
the domestic uranium industries if DOE does not go forward with the 
transfer. DOE compares these two forecasts to determine the relevant 
impacts on the domestic uranium industries. In conducting this 
comparison, DOE has developed a set of factors that this analysis 
considers in assessing whether DOE's uranium transfers will have an 
``adverse material impact'' on the domestic uranium mining, conversion, 
or enrichment industries:

1. Prices
2. Production at existing facilities
3. Employment levels in the industry
4. Changes in capital improvement plans and development of future 
facilities
5. Long-term viability and health of the industry
6. Russian HEU Agreement and Suspension Agreement

    While no single factor is dispositive of the issue, DOE believes 
that these factors are representative of the types of impacts that the 
proposed transfers may have on the domestic uranium industries. Not 
every factor will necessarily be relevant on a given occasion or to a 
particular industry; DOE intends this list of factors only as a guide 
to its analysis.

III. Assessment of Potential Impacts

    There is currently no domestic commercial supplier of high-assay 
LEU. In particular, with the closing of the Paducah Gaseous Diffusion 
Plant in 2013, the only remaining operational uranium enrichment 
facility in the U.S. is that operated by Louisiana Energy Services, 
LLC, which is licensed by the Nuclear Regulatory Commission to possess 
LEU only up to 5 wt-% U-235,\2\ meaning no domestic commercial uranium 
enrichment facility is currently licensed to possess the high-assay LEU 
contemplated for transfer.
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    \2\ U.S. Nuclear Regulatory Commission, Materials License. 
License Number SNM-2010, Amendment 57, Docket Number 70-3103.
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    Modern enrichment facilities are technologically able to produce 
such materials; however, due to the economics of enrichment, owners and 
operators of such enrichment facilities have thus far chosen not to 
pursue enrichment of high-assay LEU. To produce such LEU, a commercial 
supplier would need to secure an appropriate license or license 
amendment, a task that would require an investment of money and time. 
Projections of demand in the nuclear medicine industry lead to the 
forecast that the need for high-assay LEU in future years will range 
from tens to hundreds of kilograms. Compared to the thousands of metric 
tons of enriched uranium required by the commercial power industry, and 
given the costs required for licensing, the production of such small 
quantities of high-assay materials is not likely to be economically 
viable for private industry.
    There also does not exist currently a foreign commercial producer 
or supplier of high-assay low enriched uranium for use in domestic 
research reactors or medical isotope production applications; what 
high-assay LEU is produced internationally, for example to convert 
Russian-supplied reactors from highly enriched uranium (HEU) cores, is 
produced by a state-owned enterprise for official purposes via down-
blending excess HEU.
    Given the specialized uses, designs, and regulatory requirements of 
the fuels and targets used for these isotope production purposes, it is 
not feasible to replace the DOE-sourced high-assay LEU used in research 
reactor fuel or targets with commercial-assay LEU because fuel or 
targets fabricated from commercial-assay LEU would generally not serve 
the intended purposes.
    Given the lack of commercial production or supply of such 
materials, an analysis of the impact of transfers based on an 
assessment of the six factors listed in Section II is straightforward: 
since the transfer of DOE material would not displace primary 
production of uranium concentrates, conversion services, or enrichment 
services, there is no impact on the domestic uranium industries with 
respect to any of the factors.
    Even if the DOE transfers would displace production among the 
domestic uranium mining, conversion, or enrichment industries, the 
amount is so small that the effects would be de minimis. With respect 
to the three uranium industries, in order to produce the amount of LEU 
in DOE transfers from primary production, it would require about 2500 
pounds of uranium concentrates, 950 kgU of conversion services, and 
approximately 1,100 SWU of enrichment services. By comparison, the 
entire global fleet of nuclear reactors is expected to need in 2015 
approximately 160 million pounds U3O8, 56 million 
kgU of conversion services, and about 45 million SWU.\3\ For further 
comparison, the U.S. uranium mining industry produced approximately 4.9 
million pounds of U3O8 in 2014.\4\ The domestic 
conversion industry consists of only one facility. In recent years, 
that facility has produced between 11 and 12 million kgU. As mentioned 
above, there is only one currently operating enrichment facility in the 
U.S. The total capacity of that facility is currently about 3.7 million 
SWU.
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    \3\ These estimates of global requirements come from an analysis 
prepared by Energy Resources International, Inc. (ERI), dated 
February 20, 2015. This report is available at http://www.energy.gov/ne/downloads/excess-uranium-management. DOE tasked 
ERI to prepare this analysis to assess the potential effects on the 
domestic uranium mining, conversion, and enrichment industries of 
the introduction into the market of uranium transfers that are not 
the subject of this assessment. ERI develops its requirements 
forecasts for various customers. Because of ERI's general expertise 
in the uranium markets and contacts with market participants, DOE 
believes ERI's general market information is reliable.
    \4\ EIA, Domestic Uranium Production Report Q4 2014, 2 (January 
2015).
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    Given how small DOE transfers are compared to either global reactor 
requirements or domestic production, DOE concludes that transfers at 
this level would have almost no impact on the domestic uranium mining, 
conversion, or enrichment industries with respect to any of the six 
factors listed in Section II.
    DOE recently issued a determination that certain transfers of 
natural uranium in exchange for cleanup services at the Portsmouth 
Gaseous Diffusion Plant and of LEU in exchange for downblending 
services will not have an adverse material impact on the domestic 
uranium industries. The analysis supporting that determination also 
considered various other past transfers,

[[Page 65730]]

the uranium from which may still be affecting markets. 80 FR at 26,385. 
In reaching the conclusion that transfers of up to 25 kg per year of 
high-assay LEU will have at most de minimis impacts on the domestic 
uranium industries, DOE takes account of the various transfers assessed 
for its recent determination.

IV. Conclusion

    For the reasons discussed above, these transfers will not have an 
adverse material impact on the domestic uranium mining, conversion, or 
enrichment industry taking into account sales under the Russian HEU 
Agreement and Suspension Agreement.

[FR Doc. 2015-27303 Filed 10-26-15; 8:45 am]
BILLING CODE 6450-01-P