The Paducah Sun
The Paducah Sun
Paducah, Kentucky
Wednesday, January 16, 2002

Conversion plant for uranium hits new political snag
Tuesday was supposed to be the deadline for announcing a winning bid for construction of the waste-conversion plant. The delay is indefinite.

By Joe Walker jwalker@paducahsun.com--270.575.8650

Four years after a federal law was passed to build a uranium waste-conversion facility at Paducah, the project apparently has hit still another political snag in the nation's capital.

On Tuesday, the day a contractor was slated to be named after months of bid evaluations, Sen. Mitch McConnell, R-Louisville, who authored the legislation, talked by phone with Department of Energy and Office of Management and Budget officials regarding concerns with the project.

"I can confirm there have been discussions with OMB and DOE," said Robert Steurer, press secretary for McConnell, who is in Kentucky this month during a congressional recess. "He's working really hard to get this project moving forward."

Steurer said he could not discuss details of the conversations. Department of Energy officials who had planned to announce the winning bidder provided no insight about the reported indefinite delay.

Although official word was unavailable, some sources speculated the OMB, Congress' financial arm, has continuing concerns about the cost and scope of the work. DOE’s preferred option of converting the uranium hexafluoride into safer uranium dioxide is expected to cost $1.2 billion to $1.5 billion and create several hundred construction jobs. Construction must start by Jan. 31, 2004.

Rumors surfaced a month ago within the nuclear industry that the OMB had told the Department of Energy the conversion project was not a funding priority. That was despite a 1998 federal law calling for the work and earmarking about $373 million for facilities at Paducah and Piketon, Ohio, to convert about 14 billion pounds of the material in about 60,000 cylinders. About two-thirds of the canisters are at the Paducah uranium enrichment plant and the rest are at closed enrichment plants at Piketon and Oak Ridge, Tenn.

Phil Potter, Washington-based policy analyst for Paper, Allied-Industrial, Chemical and Energy Workers (PACE) International, said he understands the delay is largely due to disagreement over how many plants should be built.

"We've not been able to confirm that with anybody with real authority with the OMB," he added.

He said the OMB apparently favored no plants and DOE favored two, after which the OMB responded it would back a one-plant plan.

"It's been going back and forth now for a couple of weeks and we just don't know what the outcome is and how they're going to deal with it," said Potter, whose union workers would have priority for the jobs. "Everybody seems to believe that if there is only one plant, Paducah would have an advantage because it has more cylinders."

That is "totally unsatisfactory" to the Ohio delegation, which co-wrote the legislation with McConnell only to see USEC Inc. close the Piketon plant last summer amid financial trouble, he said.

Congress mandated the plan to eliminate the waste while creating about 150 long-term jobs in each community, heavily affected by USEC layoffs. DOE hopes some parts of the material, particularly fluorine compounds, can be used commercially to generate about $200 million in revenue during the roughly 25 years of conversion work.

But the project has stumbled again and again since 1998. Labor leaders, civic officials and congressional delegations have repeatedly criticized the OMB and DOE for foot-dragging over budgetary issues. DOE delayed bidding for more than a year before resuming the process in late 2000.

There are also concerns by some plant neighbors and watchdog groups about the safety of converting the material, which contains low-level radiation and poses chemical hazards. Some of the cylinders are rusty and have leaked.

Chamber of commerce, economic development and county government officials have endorsed the conversion project because of its economic potential and the public safety risk of continuing to store the cylinders. DOE officials say the canisters cover about 42 acres at the three sites and, containing dense uranium, have a total weight about a tenth as much as the Great Pyramid in Egypt.

DOE is doing an environmental study to assess worker and public health and environmental impacts of the conversion project. It also will gauge the facilities’ construction and effect on local employment, income, population, housing and public services.

A draft environmental impact statement is expected to be issued in June and a final statement in January 2003.