Romanian Government Sells Uranium Concentrate Stock to Nuclearelectrica
After the National Uranium Company (CNU) was wound up last year, which also meant the closure of the last uranium mine in Romania, the Crucea mine in Suceava county, the Executive wants to sell to Nuclearelectrica the technical uranium concentrates in the safety and consumption stock. It was set up between 2009-2011 and is administered by CNU. The money obtained would be used to repay a state aid of almost RON 118 million from which it benefited. The quantity to be sold is classified information at state secret level and is disclosed only to stakeholders.
For the sale of technical uranium concentrates, the Ministry of Energy has prepared a draft Emergency Ordinance specifying that the transaction will be carried out at the market value of purified uranium octoxide at the time of signing the contract, established on the basis of the spot market reference price published in the annual or periodic reports of the EURATOM Supply Agency.
According to the Quarterly Uranium Market Report for Q2/2022 prepared by the Euratom Supply Agency (ESA), the spot price for natural uranium supply contracts (calculated for the last 6 months of 2021) was EUR 86.07/kgU. Taking into account the NBR exchange rate on 3.10.2022, the value in RON of one kg of natural uranium is 86.07×4.9480 = RON 425.87/kgU. Uranium octoxide (UO2) is needed to make the fuel bundles used at the Cernavodă nuclear power plant. Uranium octoxide is obtained by processing/refining uranium concentrate (U3O8).
The world’s largest uranium producers are Kazakhstan, Canada, and Australia.
State aid granted to CNU must be recovered
The money obtained from the sale of the stock would constitute revenue to the state budget, which has to recover the state aid granted to CNU.
According to European Commission Decision No. C (2020) 1069 final, the amount to be recovered is RON 178.3 million plus contractual interest.
Since 2016, the state has provided the company with a 6-month rescue loan of over RON 62 million, which was later converted (by cancelling the repayment obligation) into restructuring aid of RON 60.4 million. In addition, the company has also received three grants totalling RON 117.9 million.
On June 12, 2017, Romania notified the European Commission of a restructuring plan for CNU, worth about RON 941 million, which included public support of RON 441 million lei the form of grants, subsidies, debt cancellation and debt-to-equity swap, but the plan was rejected by the European Commission.
Uranium concentrate purchased from import
Currently, the National Company Nuclearelectrica (SNN) is buying uranium concentrate from the Canadian firm Cameco and Kazakhstan’s Kazatomprom.
The last tender for the purchase was held this spring, with an estimated value of USD 180 million. The uranium concentrate is delivered to the processing plant in Feldioara, Brasov County, which SNN acquired from the bankrupt CNU, paying around nine million euros for it.
After processing, the uranium is sent to the Nuclear Fuel Plant in Pitesti, where the fuel bundles needed for the reactors are produced.
Uranium is no longer mined in Romania
Currently, the uranium used at the Cernavoda nuclear power plant is imported or from stocks built up in recent years.
Today, uranium ore is no longer mined in Romania, after the Executive decided in June 2021 to stop work at the Crucea mine in Suceava county. Its exploitation had become unprofitable because the reserves had been depleted, but there was talk of opening the mine at Grintiesul Auriu, Neamt County, where there is an important deposit that has been exploited in the past.
In its heyday, the mine at Grintiesul Auriu had more than 40 galleries where about 2,000 people worked. Energy Minister Virgil Popescu promises however to reopen the Grinties mine, but so far, no steps have been taken to determine the level of investment and its duration.
The National Agency for Mineral Resources ordered a re-evaluation of the mine’s deposits in early 2000, and work here was halted in October 2001 because no investment funds were allocated.
According to the latest estimates made in 2019, the total investment value for the reopening was RON 40,331,000 and the average annual uranium ore mining capacity was estimated at 124,000 tons.
Romania no longer produces heavy water
Another component of the Romanian civil nuclear chain was the Romanian Authority for Nuclear Activities (RAAN) from Drobeta Turnu-Severin.
Until 2012, the heavy water needed to start up the nuclear reactors at the Cernavoda nuclear power plant was produced here, and later it was used only to replenish quantities.
Due to accumulated debts, the authority went bankrupt in early 2016, after having filed for insolvency in September 2013. Under these circumstances, the National Administration of State Reserves and Special Issues (ANRSPS) took over the assets, facilities and equipment needed to manage heavy water stocks in 2020. Managing the heavy water stock is not a cheap operation, at the time of the bankruptcy it cost around EUR 12 million a year.
RAAN’s heavy water plant was the largest producer in the world, with heavy water produced here also having the highest concentration of nuclear use (99.78%). At present, the stock, which is also sufficient for reactors 3 and 4, is estimated at around EUR 1.3 billion.
About CNU
Compania Nationala a Uraniului S.A. (National Uranium Company – CNU), established by Government Decision No. 785/1997, is the sole producer and supplier of uranium dioxide in Romania, destined for the production of nuclear fuel for CANDU reactors at the Cernavoda NPP.
By European Commission Decision No. C (2016) 6250 final of September 30, 2016, the granting of rescue aid to the National Uranium Company was authorized. On the basis of this Decision, by GEO No. 65/2016 on the establishment of the legal framework for granting individual state aid for the rescue of the National Uranium Company, as amended and supplemented by Law No. 42/2017, the mechanism underlying the granting and repayment of this loan was established, as well as all the other obligations that the company must fulfil.
The National Uranium Company has entered general insolvency proceedings pursuant to the Civil Judgment pronounced by the Bucharest Court, Civil Section VII in case no. 23089/3/2021, on 14.12.2021.
