United Arab Emirates Push Ahead with Nuclear Energy Plans

The Emirates Nuclear Energy Corporation (ENEC) announced today 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 program by providing volume flexibilities and the ability to adapt to changing market conditions.

The following services have been contracted by ENEC:

• 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)

• 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 program. ConverDyn (U.S.) will provide conversion services; Uranium One, Inc. (Canada) will provide natural uranium, URENCO (headquartered in the U.K) will provide enrichment services; and Rio Tinto (headquartered in the U.K) 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 six contracts are valued at approximately US$3 billion according to ENEC forecasts. 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.

“The completion of the fuel supply strategy is a key achievement to ENEC’s program and a clear example of how the UAE continues to set the gold standard for implementing a peaceful nuclear energy program,” said ENEC’s Chief Executive Officer Mohamed Al Hammadi. “These contracts will provide ENEC with long-term security of supply, high quality fuel and favorable 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 United Arab Emirates’ 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 favorable market conditions and to strengthen its security of supply position.  ENEC is planning to build four 1,400-MW nuclear energy units at the recently approved site, Barakah, in the Western Region of the Emirate of Abu Dhabi, in order to provide the electricity needed to fuel the economic growth of the UAE. In July, ENEC received regulatory approval from both the Environment Agency of Abu Dhabi and the Federal Authority for Nuclear Regulation for the construction of the first two nuclear energy units in Barakah.  Pending further regulatory approvals, the first unit is scheduled to begin delivering electricity to the grid in 2017. The remaining three units are scheduled to come on line in 2018, 2019 and 2020.

Emirates Nuclear Energy Corporation Awards Nuclear Fuel Supply Contracts, Nuclear Street News, Aug 15 2012

See also UAE goes Forward with its Nuclear Energy Program

The Quiet Nuclearization of the Middle East, UAE

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