Demobilization Will Proceed
BETHESDA, Md.--(BUSINESS WIRE)--Jul. 29, 2009--
USEC Inc. (NYSE:USU) announced that it is requesting that the Obama
administration review further the economic recovery and national and
energy security benefits of providing a loan guarantee for the American
Centrifuge Plant in Piketon, Ohio. This announcement comes in response
to the U.S. Department of Energy’s (DOE) request that USEC withdraw its
application for loan guarantee funding.
“We believe the American Centrifuge Plant meets the financial and
technical requirements of the Department’s Loan Guarantee Program as
well as numerous Obama administration policy objectives,” said John K.
Welch, USEC president and chief executive officer. “Accordingly, we plan
to pursue further discussions with DOE to work with them to address any
remaining technical and financial concerns they may have.
“As a result of the current uncertainty regarding DOE loan guarantee
funding, we have been forced to begin the process of demobilizing the
project and initiating layoffs that will directly affect nearly 2,000
current USEC and contractor employees in Ohio and several other states
in the near term and indirectly impact thousands more,” Welch added.
“Reluctantly, we have no choice but to begin demobilization. However, we
hope that the demobilization process can be averted by quick action by
the Obama administration. USEC is prepared to work with DOE and the
Obama administration to fashion a mutually acceptable loan guarantee
that protects the taxpayers’ interests, while providing the financing
needed to deploy the American Centrifuge Plant.
“We previously provided DOE with a financially sound path forward for
completing the project. Specifically, to ensure repayment and protect
U.S. taxpayers, USEC offered to provide a $1 billion parent guarantee
that would be fully collateralized by non-project, corporate assets,”
Welch added. “This structure would allow DOE to proceed with funding on
a fully protected basis and avoid demobilization while USEC would
continue to address any remaining technical and financial issues over
the next 9-12 months. This offer is still on the table, and we believe
it can provide the path to prompt implementation of federal loan
guarantee funding for this important national project.”
USEC also disagrees with DOE’s characterization that the American
Centrifuge technology is not technologically ready to move to commercial
operations. Building upon DOE’s decade of experience with centrifuge
machines, USEC has operated the centrifuges for over 235,000 machine
hours, giving the Company data and expertise to begin the transition to
commercial operation.
USEC’s customers have also expressed confidence in the technology and
have already committed to purchasing over half of the initial, planned
output of the American Centrifuge Plant. Christopher M. Crane, president
and chief operating officer of Exelon, the largest nuclear utility in
the United States, said: "We have confidence in the American Centrifuge
technology, and we believe it would be an important player in the future
of uranium enrichment.”
USEC strongly believes in the American Centrifuge technology and is
committed to further interactions with DOE and the Obama administration
to find an acceptable path forward. As America's only commercial uranium
enrichment facility using U.S.-owned and operated centrifuge technology,
the American Centrifuge Plant can play an important role in America's
energy security and national security.
USEC Inc., a global energy company, is a leading supplier of enriched
uranium fuel for commercial nuclear power plants.
Forward Looking Statements
This news release contains “forward-looking statements” – that is,
statements related to future events. In this context, forward-looking
statements may address our expected future business and financial
performance, and often contain words such as “expects,” “anticipates,”
“intends,” “plans,” “believes,” “will” and other words of similar
meaning. Forward-looking statements by their nature address matters that
are, to different degrees, uncertain. For USEC, particular risks and
uncertainties that could cause our actual future results to differ
materially from those expressed in our forward-looking statements
include, but are not limited to: risks related to the deployment of the
American Centrifuge technology, including our ability to meet targets
for performance, cost and schedule and to obtain financing; the impact
of our failure to obtain a loan guarantee for the American Centrifuge
Plant and the impact of delays in financing and demobilization on the
American Centrifuge project and our business; the failure of our efforts
to seek further review of our loan guarantee application; changes to, or
termination of, our contracts with the U.S. government and changes in
U.S. government priorities and the availability of government funding,
including loan guarantees; the competitive environment for our products
and services; changes in the nuclear energy industry; and other risks
and uncertainties discussed in our filings with the Securities and
Exchange Commission, including our Annual Report on Form 10-K and
quarterly reports on Form 10-Q. Revenue and operating results can
fluctuate significantly from quarter to quarter, and in some cases, year
to year. We do not undertake to update our forward-looking statements
except as required by law.
Source: USEC Inc.
USEC Inc.
Media:
Elizabeth Stuckle, 301-564-3399
or
Investors:
Steven
Wingfield, 301-564-3354
