USEC, Inc. (USU) Eases Following Putin Commentary on Russia/Ukraine Issues
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USEC, Inc. (NYSE: USU) is paring gains made on Monday's session as Russian president Vladimir Putin moved to quell some concerns over Russia's recent occupation of key Ukraine locations.
Markets were exceptionally volatile Monday after Russia took over locations around in Crimea. Stocks sank on what the move might mean and what sort of global impact might transpire.
USEC has a contract with Russia for its low enriched uranium (LEU) fuel supply. From the company's website:
In March 2011, USEC signed a multi-year supply contract with Techsnabexport (TENEX) of Russia to replace the low enriched uranium fuel supply that will no longer be available to USEC once the Megatons-to-Megawatts™ program concludes at the end of 2013. The contract took effect in December 2011
The new contract will assure USEC’s continued access to this important source of supply of low enriched uranium fuel for its customers during a transition period as USEC builds out its American Centrifuge Plant in southern Ohio.
This contract complements those on-going activities and is mutually beneficial to USEC and TENEX. It helps USEC meet customer commitments, continues USEC’s long-standing supply relationship with TENEX, and strengthens USEC’s financial position as it moves forward with the American Centrifuge.
Deal Terms
-- The Transitional Supply Contract is a multi-year contract to purchase about 21 million separative work units (SWU) through 2022 with a mutual option to purchase up to another 25 million SWU during that period.
-- USEC will purchase the SWU contained in the low enriched uranium and deliver natural uranium to TENEX for the low enriched uranium’s uranium component.
-- The low enriched uranium supplied by TENEX will come from Russia’s commercial enrichment activities rather than from downblending of excess Russian highly enriched uranium.
-- The pricing terms for SWU under the contract are proprietary, but are based on a mix of market-related price points and other factors.
Meanwhile, USEC rose 8.2 percent on the session to close at $5.96. Today, the stock is down 6.5 percent on Tuesday's session.
Markets were exceptionally volatile Monday after Russia took over locations around in Crimea. Stocks sank on what the move might mean and what sort of global impact might transpire.
USEC has a contract with Russia for its low enriched uranium (LEU) fuel supply. From the company's website:
In March 2011, USEC signed a multi-year supply contract with Techsnabexport (TENEX) of Russia to replace the low enriched uranium fuel supply that will no longer be available to USEC once the Megatons-to-Megawatts™ program concludes at the end of 2013. The contract took effect in December 2011
The new contract will assure USEC’s continued access to this important source of supply of low enriched uranium fuel for its customers during a transition period as USEC builds out its American Centrifuge Plant in southern Ohio.
This contract complements those on-going activities and is mutually beneficial to USEC and TENEX. It helps USEC meet customer commitments, continues USEC’s long-standing supply relationship with TENEX, and strengthens USEC’s financial position as it moves forward with the American Centrifuge.
Deal Terms
-- The Transitional Supply Contract is a multi-year contract to purchase about 21 million separative work units (SWU) through 2022 with a mutual option to purchase up to another 25 million SWU during that period.
-- USEC will purchase the SWU contained in the low enriched uranium and deliver natural uranium to TENEX for the low enriched uranium’s uranium component.
-- The low enriched uranium supplied by TENEX will come from Russia’s commercial enrichment activities rather than from downblending of excess Russian highly enriched uranium.
-- The pricing terms for SWU under the contract are proprietary, but are based on a mix of market-related price points and other factors.
Meanwhile, USEC rose 8.2 percent on the session to close at $5.96. Today, the stock is down 6.5 percent on Tuesday's session.
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