Company: LEU
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001065059-25-000024
Chunk: 46

Company: CENTRUS ENERGY CORP
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 1
Chunk 46
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 2 contract value of approximately $90.0 million, subject to Congressional appropriations. The DOE owns the HALEU produced from the demonstration cascade. The HALEU Operation Contract also gives DOE the ability to exercise three optional periods to contract for up to nine additional years of production from the cascade beyond the base contract; those options are at the DOE’s sole discretion and subject to the availability of Congressional appropriations. Pursuant to an amendment to the Company’s lease for the Piketon facility, the DOE assumed all D&D liabilities arising out of the HALEU Operation Contract.Under the HALEU Operation Contract, DOE is contractually obligated to provide the 5B Cylinders necessary for the collection to collect the output of the cascade, but supply chain challenges had created difficulties for DOE in securing enough 5B Cylinders for the entire production year under Phase 2. During time periods when 5B Cylinders were insufficient, the Company was able to continue operations of the cascade, but did not produce HALEU as it did not have 5B Cylinders to store the offtake. Due to these delays, Centrus was unable to achieve delivery of the 900 kilograms of HALEU UF6 for Phase 2. Centrus’ contractual delivery obligation of 900 kilograms by November 2024, was conditioned on DOE’s ability to provide the 5B Cylinders on a timeline that allowed for continuous production throughout Phase 2 of the contract. In light of the delays, on November 5, 2024, the HALEU Operation Contract was modified to extend the Phase 2 period of performance to June 30, 2025. DOE has increased the Phase 2 contract value and related funding to $152.3 million. Centrus began to receive deliveries of additional 5B Cylinders in October 2024 and expects to have adequate cylinders to produce the minimum amount by the end of Phase 2. The target fee for Phase 2 of the contract is estimated to $7.7 million based on the estimated costs for the contract and is subject to a contract minimum fee of $6.9 million.In accordance with the HALEU Operation Contract, the Company has submitted several change order requests for work being performed on infrastructure, facility repairs, and 5B Cylinders. The additional work is being performed under the DOE’s technical direction or contract modifications. On September 28, 2023, the DOE modified the HALEU Operation Contract to incorporate additional