FACTBOX-Uranium enrichment and the juicing of oranges
PARIS, Feb 6 (Reuters) - The planned sale of nuclear fuel vendor Urenco has put the spotlight on ultra-secret uranium enrichment technology.
To understand that process, think about orange juice.
BANKS OF CYLINDERS
To get one glass of juice, you can put three oranges in the juicer and press gently, or put two, and squeeze very hard.
Uranium enrichment is a bit like that, except that the squeezing is done by banks of cylinders spinning at supersonic speed in factories that cost billions of dollars.
Natural uranium contains only 0.7 percent of the fissile U-235 isotope. During enrichment, U-235 is concentrated to about 5 percent for civil use, and 90 percent for bombs.
The original enrichment process, widely used until a few years ago, was gaseous diffusion, which pushed gasified uranium hexafluoride through porous membranes to concentrate the U-235.
Now obsolete, diffusion plants consumed huge amounts of energy, requiring entire nuclear plants to power them.
The centrifuge process uses 50 times less energy and filters U-235 by spinning the gas at supersonic speeds until the heavier U-238 isotope separates out.
Because of their high energy needs, enrichment plants' output is measured in "Separative Work Units" (SWU). When uranium prices are high, utilities buy more SWU to get more U-235, like squeezing harder an on orange to get more juice, industry veterans say.
Russia's Tenex leads this industry, with an output of 23,000 tSWU (thousand of SWU) in 2010, or 40 percent of global production, according to the World Nuclear Association.
British-German-Dutch Urenco was a distant second with 12,800 tSWU, followed by America's USEC with 11,300 tSWU and France's Areva with 8,500 tSWU. China's CNNC produced just 1300 tSWU, but that is expected to more than quadruple by 2020, the WNA said.
Urenco sells nuclear fuel to the world's electric utilities, but does not produce its own centrifuges. The centrifuge technology was put into a Urenco-Areva joint venture in 2006: Enrichment Technology Company (ETC). ETC builds centrifuges for its two shareholders, who are its sole customers.
ETC had 2011 revenue of 690 million euros and employs 1,800 staff in its research center in Capenhurst, UK, its centrifuge factory in Almelo, the Netherlands and facilities in Gronau and Julich, Germany.
Despite using the same centrifuges, Urenco and Areva compete on all other fronts in the global nuclear fuel market - it is as if Volkswagen and Peugeot shared a common engine supplier.
Both are expanding aggressively. Urenco is building a new plant in Eunice, New Mexico, Areva is expanding its plant in Tricastin, which began production in 2011 while work continues on a second site. It also plans a U.S. factory.
STEADY CASH MACHINE
The nuclear fuel business is a reliable cash machine as utilities want to lock in fuel supply in multi-year contracts.
In December 2011, Urenco's order book extended beyond 2025 and was in excess of 20 billion euros, more than 15 times its 1.3 billion euro revenue. The firm generated 903 million euros in cash.
Demand seems guaranteed: the United Nations' atomic energy agency expects global nuclear generating capacity to grow by between 25 and 100 percent by 2030.
The UK hopes to earn billions from a Urenco privatisation, but the talks move at a glacial pace and there is a risk that technological progress could reduce Urenco's value.
In September, the U.S. licensed General Electric Co. and Japan's Hitachi Ltd to build a uranium enrichment plant using laser technology.
Experts say laser enrichment is still experimental and years away from commercial exploitation, but if and when the technology takes off, it could do to centrifuge technology what centrifuges did to gas diffusion plants: make them obsolete.
(Reporting by Geert De Clercq; Editing by Erica Billingham)