Enriching uranium for nuclear fuel: Europe cuts into US monopoly

Even as the United States nuclear power program stagnates, the business of enriching uranium for nuclear fuel is booming in Western Europe. Nearly one-third of the world's enrichment capacity now is in the hands of two West European companies. The processing boosts the content of the fissionable isotope U-235 natural from about 0.7 percent (as found natural in uranium) to around 3 percent -- a concentration suitable for reactor fuel. The US, which still controls about two-thirds of world enrichment capacity, once monopolized the industry.

Both European companies -- EURODIF, a five-nation consortium led by France, and URENCO, owned about 50-50 by the Dutch government and several West German private companies -- have plants that will reach full commercial operating levels next year. They plan to expand production further. Existing orders already are adequate to keep both companies busy into the next decade.

URENCO's customers are in West Germany (60 percent), Britain (30 percent), and Brazil (10 percent). Contracts for enrichment work to be done at the firm's factories in Almelo, the Netherlands, and at Britain's enrichment plant at Capenhurst total some 22,000 tons valued at about $3 billion, according to a company spokesman. By next year, the company should be filling about 5 percent of world demand for enriched nuclear fuel.

EURODIF's enrichment facility -- along- side a nuclear power plant at Triscatin in the Rhone Valley of France -- Turned out its first salable product two years ago. But the plant will not reach full operating capacity until next year, when it will begin to work in earnest under long-term contracts signed with the electricity-supply companies of EURODIF's five partner nations -- France, Italy, Belgium, Spain, and Iran -- plus Japan, West Germany, and Switzerland. Workers at the Triscatin plant will be occupied for at least the first 10 years -- until 1990 -- of the factory's 20-year design life.

Industry sources say the two West European companies could be satisfying as much as 50 percent of the world's thirst for enriched uranium by 1990.

France alone will require lots of enriched nuclear fuel. It will increase its nuclear-generating capability over the next decade from the present 5,000 megawatts to 50,000 megawatts, supplying 50 percent of the country's electricity. France and the Eastern bloc countries are unique in the world in their continuing enthusiasm for nuclear energy, a Rockefeller Foundation study has concluded.

More important, US enriched uranium production could fall off drastically in this decade unless the country's nuclear program changes direction quickly and dramatically. US nuclear generating capacity actually dropped during 1979 -- from 12.9 percent of the national electricity supply prior to Three Mile Island accident in March to 10.6 percent in December.

Meanwhile, as both EURODIF and URENCO pick up business, other countries will be increasingly reluctant to send their uranium to the US for enrichment, given the less-than-eager US attitude toward nuclear power development in recent years.

The Soviet Union is certain to figure prominently in the enriched uranium supply picture over the next decade, although industry analysts remain extremely edgy about discussing the prospect. The Soviet Union today has only 7 percent of the world's enrichment capability. But it will increase its installed nuclear power capacity in the next 10 years by more than sevenfold. Some analysts say that the Russians will be forced to look beyond their own borders to satisfy their growing demand for enriched uranium -- at least until their own enrichment capability is built up. Given current US-Soviet relations, the only choice the Russians will have is Western Europe.

Also to EURODIF and URENCO's advantage, will be an inclination on the part of potential European customers to look increasingly inward in the next few years. As the economic recession continues, they are likely to turn almost exclusively to the two European enrichment groups for supplies.

A certain shirt toward "Europeanization" has already been seen in the recent decision by three West German electricity firms to switch a contract for 3,200 tons of uranium enrichment from the US Department of Energy to URENCO. Other European utilities companies have taken options in their contract with the DOE to re-allocate orders to URENCO and EURODIF.

So optimistic are the Europeans, especially the French, about the future of the uranium-enrichment business that EURODIF's sister company, COREDIF, although shelved for the moment, could be launched as early as 1985, according to Jean-Francois Petit, president of EURODIF's management board.

Set up in 1975, COREDIF calls for building a second uranium-enrichment facility in Europe.

Fifty-one percent of COREDIF is owned by EURODIF, which in turn is 51 percent owned by the French and 29 percent controlled by France's national nuclear fuel company, COGEMA. The remaining 20 percent belongs to Iran. The future of its shareholdings in both EURODIF and COREDIF has been uncertain since Iran decided to forego nuclear power in favor of other sources of energy. Recently, however, Iran has hinted that it will begin construction of nuclear reactors again.

Whether or not Europe is correct in its optimism about uranium enrichment remains to be seen. Present world enrichment capacity (30,000 tons) far outstrips demand (15,000 tons). But experts think that supply and demand will come into balance by about 1990.

The secretariat of the International Energy Agency (INA) said recently that "present capacity in operation or under construction is expected to cover projected enrichment needs until around 1990, and presently planned additions would cover projected enrichment needs into the latter half of the 1990s." The INA -- of which France is not a member -- obviously had Europe in mind.