Actively embrace nuclear energy! US awards Centrus Energy (LEU.US) and Orano uranium enrichment contracts

The Zhitong Finance App learned that the Biden administration has awarded contracts to companies such as Centrus Energy (LEU.US) and Orano SA to develop highly enriched uranium needed for new advanced nuclear reactors.

These contracts will use up to $2.7 billion in government funding, and the exact amount will depend on future orders issued by the US Department of Energy. General Matter and Louisiana Energy Services, which operates Urenco's New Mexico uranium enrichment plant, are two other companies that have received funding.

This nuclear fuel, known as high-content low-enriched uranium (Haleu), is used to power small modular reactors. Unlike traditional reactors, this type of reactor can be built in a factory, transported by truck or train, and assembled on-site. Currently, the only supplier of Haleu with concentrations between 5% and 20% is Russia.

The funding is part of the Biden administration's multi-billion dollar plan to rid the US of its dependence on cheap Russian uranium enrichment and help restart the long-standing stagnant US uranium enrichment industry and other professional services needed to make nuclear fuel. Earlier this year, a ban on importing Russian reactor fuel came into effect, but the legislation allows the US Department of Energy to implement limited exemptions until 2028.

Earlier this month, the US government awarded a similar nuclear conversion service contract to convert gaseous uranium hexafluoride into an oxide that can be made into fuel after enrichment.

By Thursday's close, Centrus Energy was up nearly 5%. Since this year, the stock has increased by 49% cumulatively.

Notably, as technology giants such as Amazon (AMZN.US) and Microsoft (MSFT.US) actively embraced nuclear energy, the US nuclear power sector soared. Among them, NuScale Power (SMR.US) rose nearly 450% during the year, NANO Nuclear Energy (NNE.US) rose 370% during the year, and Vistra Energy (VST.US) rose 230% during the year.