Abu Dhabi: The Emirates Nuclear Energy Corporation (Enec) has signed six contracts worth $3 billion (Dh11.01 buillion) including procurement for nuclear fuel.
The contracted fuel will enable the Barakah plant to generate up to 450 million MWh for a period of 15 years starting in 2017, when the first nuclear energy unit is scheduled to begin providing safe, clean, reliable and efficient electricity to the UAE.
Enec announced yesterday the results of the nuclear fuel procurement competition launched in July 2011. The goal of the fuel competition is to create a strategy to cover supply for the first 15 years of operations.
A portfolio of leading international nuclear fuel suppliers have been contracted to provide a series of nuclear fuel services to cover Enec’s requirements. The resulting fuel strategy guarantees security of supply, quality assurance of fuel-related materials and competitive commercial terms to protect the interests of the UAE peaceful nuclear energy programme by providing volume flexibilities and the ability to adapt to changing market conditions.
The services contracted by Enec include purchase of natural uranium concentrates; conversion services (in which uranium concentrates are converted to material ready for enrichment); enrichment services (in which the converted material is enriched to a level that is used in the fuel for nuclear energy plants); and purchase of enriched uranium product.
The enriched uranium will be supplied to KEPCO Nuclear Fuels (KNF), which will manufacture the fuel assemblies for use in the four planned UAE units. KNF is a member of Enec’s prime contract consortium, led by Korea Electric Power Corporation (KEPCO).
Starting in 2014-2015, a total of six leading companies in the nuclear fuel supply industry will participate in the Enec fuel supply programme. ConverDyn (US) will provide conversion services; Uranium One, Inc (Canada) will provide natural uranium, URENCO (headquartered in the UK) will provide enrichment services; and Rio Tinto (headquartered in the UK) will provide natural uranium. TENEX (Russia) will supply uranium concentrates, conversion services and enrichment services. AREVA (France) will provide uranium concentrates, conversion services and enrichment services.
“The completion of the fuel supply strategy is a key achievement to Enec’s programme and a clear example of how the UAE continues to set the gold standard for implementing a peaceful nuclear energy programme,” said Enec’s Chief Executive Officer Mohammad Al Hammadi. “These contracts will provide Enec with long-term security of supply, high quality fuel and favuorable pricing and commercial terms. We are also pleased that this marks the start of long-term commercial relationships with companies that have earned excellent reputations in the industry.”
The Enec fuel procurement strategy is guided by the Government of the UAEs’ support for international non-proliferation efforts. That support was detailed in a nuclear energy policy document released by the government in April 2008 that outlined a series of commitments, including the decision to forgo domestic enrichment and reprocessing of nuclear fuel. That commitment was ratified by UAE Federal Law in 2009.
The procurement competition was the result of an extensive year-long process that included initial discussions between Enec and international nuclear fuel suppliers. It was conducted in line with the industry’s best practices, under which companies contract for the various aspects of the fuel cycle as a means to ensure security of supply, high quality fuel and commercial advantage. In addition, this process will enable Enec to build a strategic commercial capability in nuclear fuel procurement. The comprehensive analysis performed by Enec included a peer review system to ensure that the procurement process was performed according to global standards.
Enec expects to return to the market at various times to take advantage of favourable market conditions and to strengthen its security of supply position.