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The American Centrifuge

USEC's Loan Guarantee Application

The U.S. Department of Energy Loan Guarantee Program was created by the Energy Policy Act of 2005. In December 2007, federal legislation authorized funding levels of up to $2 billion for advanced facilities for the front end of the nuclear fuel cycle, which includes uranium enrichment. DOE released its solicitation for the Loan Guarantee Program on June 30, 2008 and in July 2008, USEC applied to the DOE Loan Guarantee Program as the path for obtaining $2 billion in U.S. government guaranteed debt financing for the American Centrifuge Plant. On August 4, 2009, DOE and USEC announced an agreement to delay a final review of USEC’s loan guarantee application for the ACP until at least early 2010. As a result, USEC demobilized the American Centrifuge project in order to preserve liquidity. USEC is working to address DOE’s financial and technical concerns so that USEC will be in a position to update its application. USEC believes it has a well-qualified project that meets all the requirements and the spirit of the loan guarantee program.

A Well-Qualified Project

USEC believes the project is a compelling candidate for a loan guarantee:

Evaluation Factors

USEC believes the project meets all the mandatory evaluation factors set out DOE’s Loan Guarantee Solicitation, including:

Desired Outcomes for Loan Guarantee Program

USEC believes the project also will meet all of the desired outcomes listed in DOE’s solicitation:

Though the American Centrifuge project merits serious consideration for a DOE loan guarantee, USEC has no assurance that the project will be selected for a guarantee and in what timeframe. Areva, a company 92% owned by the French government, also applied for $2 billion of U.S. government guaranteed financing under this program for a proposed plant in the United States, and its application is also being considered by DOE. A decision to award a loan guarantee to Areva, absent action to expand or otherwise ensure that there are sufficient funds available for additional loan guarantees for the front end of the nuclear fuel cycle, would adversely affect USEC’s prospects for a loan guarantee and other third-party financing.