Engineering news
The UK government is to proceed with its sell-off of a one-third stake in uranium enrichment company Urenco, it confirmed today.
Officials reportedly hope to raise up to £3 billion from the sale. Michael Fallon, the business and energy minister, said the transaction would have to meet Britain's security interests as well as represent value for money.
Urenco enriches uranium using gas centrifuges to provide fuel for nuclear power. The company has 50 customers across 18 countries, representing a 31% share of the global market.
Any sale must be agreed with the Dutch and German governments. German utility companies RWE and E.On jointly own a third of the company, which is also being sold. The Netherlands, which owns the remaining stake, is also said to be considering a sale. Urenco has enrichment facilities at its UK base in Capenhurst in Cheshire, as well as in the Netherlands, Germany and New Mexico.
Potential buyers reportedly include Canadian energy firm Cameco, French nuclear group Areva, and Japan's Toshiba.
Analysts have struggled to put a price on Urenco because of the unique and secretive nature of its technology. Gas centrifuges are used to separate the U-235 isotope of uranium, which is used for nuclear fuel and weapons, out of uranium oxide. These centrifuges are extremely challenging to design and run. The centrifuges have to spin extremely fast, in excess of 60,000 rpm, requiring advanced materials and precise manufacturing techniques. The process also has to be repeated many times to obtain U-235 and therefore requires banks of centrifuges arranged into cascades.
The UK government said that safeguards are to be put in place to ensure the new owners do not have access to sensitive information about nuclear technology, which would be retained by the state. The Government will also seek to build in a requirement to be consulted as part of any future sale of the stake.
Any buyer of Urenco will not gain access to Urenco’s centrifuge technology, which is held by a Holland-based company, Enrichment Technology. This firm is owned jointly by French nuclear firm Areva and Unrenco.
Fallon said: "Urenco is a world-leading, high-technology company with strong earnings and the time is right for Government to sell its stake.
"It makes good commercial sense now and is consistent with our position that assets should be sold where ownership itself does not deliver any policy objective. Any sale will make sure we deliver value for money and protect the UK's security and non-proliferation interests."
Urenco was established in 1971 by a treaty between the UK, Dutch and German governments. A joint committee of the three nations supervises its operations, and the arrangement will remain in place following the sale.
More details of the sale are expected to be released in the summer.
Information on the market to supply enriched uranium and the technology used to produce it can be found here and at the website of Enrichment Technology Company.