June 20, 2008
Cameco Joins GE and Hitachi in Global Laser Enrichment Venture
GE Hitachi Nuclear Energy (GEH) and Cameco Corp., the world's largest uranium producer, have announced that Cameco has joined GE and Hitachi as owners of their laser enrichment venture.
The demand for enriched uranium is projected to increase significantly in the next decade with the anticipated construction of a new generation of nuclear power plants to help address the world's converging needs involving energy security and global climate change.
In response to this need, a U.S. subsidiary of Cameco, Cameco Enrichment Holdings LLC, has invested in GE Hitachi Global Laser Enrichment (GLE), a GEH subsidiary that is commercializing a third-generation enrichment process using laser technology to enrich uranium for nuclear power plants.
Cameco's participation results in three leading companies supporting the commercialization of this laser enrichment technology. Cameco Enrichment Holdings LLC has acquired a 24% interest in GLE. GE remains the majority owner, indirectly owning 51% of GLE, while Tokyo-based Hitachi Ltd. indirectly owns 25%. Tammy Orr will continue to serve as president and CEO of GLE.
Nuclear energy is receiving increased public support as one of the few available, base-load sources of power that do not create carbon emissions during the generating process. A May 2008 public opinion survey by Zogby International shows 67% of Americans support the construction of nuclear plants.
Currently, 104 licensed nuclear reactors operate in the United States, providing about 20% of the country's electricity. However, as the nation's demand for energy continues to outpace production, utilities will need to build at least 20 to 25 new, advanced reactors by 2030 to simply maintain nuclear energy's 20% role in the nation's energy portfolio, according to the Nuclear Energy Institute.
The venture is well-positioned to identify and capitalize on opportunities resulting from the parties' respective areas of technical excellence in the nuclear fuel cycle.
As part of the transaction, GLE and Cameco may sell their complementary uranium and enrichment services together if customers request proposals for combined uranium and enrichment services. The transaction enhances opportunities to collaborate on the front end of the nuclear fuel cycle.
The investment by Cameco, based in Saskatoon, Saskatchewan, extends the company's involvement in the front end of the nuclear fuel cycle.
"Cameco's investment, and the opportunity to team together on the supply of uranium and enrichment services, supports GLE's commercialization of the laser enrichment technology and enables the parties to offer an expanded scope of supply to meet our customers' needs," said Lisa Price, GEH's Senior Vice President, Nuclear Fuel Cycle. "Integration within the nuclear fuel cycle is an important long-term growth strategy for our business in a highly competitive marketplace."
"This investment further expands and integrates Cameco's interests in the nuclear fuel cycle as we pursue our objective to be a leading nuclear energy company, producing uranium fuel and generating clean electricity," said Jerry Grandey, Cameco's president and CEO. "It is fitting that three leaders in the nuclear industry support the development of the next generation of uranium enrichment technology."
GLE has exclusive rights to develop, commercialize and launch the technology on a global basis under a 2006 agreement with the original developer, the Australian company Silex Systems Ltd. A test loop facility, designed to demonstrate the commercial feasibility of the technology, is being constructed at GEH's headquarters in Wilmington, N.C. GLE anticipates a start-up of its test loop by late 2008.
GLE intends to make a final decision on the construction of a commercial facility as early as the beginning of 2009. Commercial facility licensing activities currently are underway to support a projected start-up date of 2012. The GLE commercial facility would have a target capacity of between 3.5 and 6 million separative work units (SWUs).
GEH announced on April 30 the selection of its headquarters site to host the potential full-scale GLE production facility if a decision is made to proceed with construction of the plant following the test loop phase. On May 12, the U.S. Nuclear Regulatory Commission notified GLE that the agency had approved a license amendment request to operate the test loop. Additional approvals would be required to construct and operate the commercial facility.
About GEH Nuclear Energy
Based in Wilmington, N.C., GEH is a world-leading provider of advanced reactors and nuclear services. Established in June 2007, GEH is a global nuclear alliance created by GE and Hitachi to serve the global nuclear industry. The new nuclear alliance executes a single, strategic vision to create a broader portfolio of solutions, expanding its capabilities for new reactor and service opportunities. The alliance offers customers around the world the technological leadership required to effectively enhance reactor performance, power output and safety.
About GE Energy
GE Energy (www.ge.com/energy) is one of the world's leading suppliers of power generation and energy delivery technologies, with 2007 revenue of $22 billion. Based in Atlanta, Georgia, GE Energy works in all areas of the energy industry including coal, oil, natural gas and nuclear energy; renewable resources such as water, wind, solar and biogas; and other alternative fuels. Numerous GE Energy products are certified under ecomagination, GE's corporate-wide initiative to aggressively bring to market new technologies that will help customers meet pressing environmental challenges.
About Cameco Corporation
Cameco, with its head office in Saskatoon, Saskatchewan, is the world's largest uranium producer. The company's uranium products are used to generate electricity in nuclear power plants around the world, providing one of the cleanest sources of energy available today. Cameco's shares trade on the Toronto and New York stock exchanges.