CRIMINAL CAPITALI$M

US investigation highlights risks from licence fraud

25 July 2022

The US Government Accountability Office (GAO) has recommended regulators introduce additional security features after its investigators were able to use forged licences to acquire small quantities of radioactive material.

Shipments of material obtained by GAO using fraudulent licences (Image: GAO)

The possession of radioactive materials in the USA is regulated by the US Nuclear Regulatory Commission (NRC), which issues licences controlling the type and quantity of materials that can be possessed. Using shell companies with fraudulent licences, GAO investigators were able to successfully purchase a so-called category 3 quantity of radioactive material of concern from two different vendors in the USA, the office said. Using a copy of a forged licence, GAO was able to obtain invoices, and paid the vendors, but refused to accept shipment at the point of delivery, ensuring that the material was safely and securely returned to the sender.

Radioactive materials which are commonly used for medical, industrial, and research purposes can be harmful and dangerous in the wrong hands, the GAO notes in its report to the House of Representatives Committee on Homeland Security. For example, terrorists could use such material in a radiological dispersal device - or "dirty bomb" - which uses conventional explosives to spread radioactive material. NRC's licensing process is based on risk associated with different quantities of radioactive material with categories 1 and 2 requiring the most stringent security measures for those who possess it or want to purchase it. Category 4 and 5 applies to quantities that are unlikely to cause permanent injury.

NRC requires a valid licence to possess Category 3 quantities of radioactive material, but the paper licences issued by the regulator - or by the 39 agreement states that are responsible for regulating radioactive materials within the state by arrangement with the NRC - can be altered and used to make illicit purchases of radioactive materials, GAO said. Current rules require vendors of Category 3 quantities of material to obtain a copy of the purchaser's licence but, unlike categories 1 and 2, no independent verification of the licence is required. The GAO's shell companies were successful in acquiring the material because they are not subjected to more stringent controls required for purchases of larger quantities of material, and the investigation shows that the current licence verification processes can be compromised, it said.

"By purchasing more than one shipment of a category 3 quantity of radioactive material, GAO also demonstrated that a bad actor might be able to obtain a category 2 quantity by purchasing and aggregating more than one category 3 quantity from multiple vendors," GAO said.

The GAO investigation is the latest in a series that began in 2006. The NRC has already begun work to address vulnerabilities identified in the earlier investigations, GAO said, but it could take until the end of 2023 to implement a process requiring licence verification for category 3 quantities.

GAO has made two recommendations: firstly, that NRC "immediately" requires vendors to verify category 3 licences; and secondly, that it adds security features that improve the integrity of the licensing process and make it less vulnerable to altering or forging licences. "To address our recommendations, NRC proposed a rulemaking to strengthen licensing. However, vulnerabilities will remain until NRC implements the rule," it said.

In a response to the GAO study, NRC Executive Director for Operations Daniel Dorman said: "We take your recommendations seriously and will continue our efforts to strengthen the safety and security of radioactive materials."
 
The GAO report, Preventing a Dirty Bomb: Vulnerabilities Persist in NRC's Controls for Purchases of High-Risk Radioactive Materials - which includes the NRC's response - can be read here.

Researched and written by World Nuclear News

First contract signed for Romanian nuclear refurbishment

22 July 2022

Canada's Candu Energy has signed the first contract for the refurbishment of unit 1 at Romania's Cernavoda nuclear power plant. The extensive re-tubing of the reactor will take its operational life to 2060 and directly help enable net-zero goals.

Romania's Cernavoda nuclear power plant (Image: Nuclearelectrica)

The work agreed with Cernavoda's owner, Nuclearelectrica, is worth CAD64 million (USD49 million) and covers engineering and early procurement for the retubing of the reactor core. Candu units are pressurised heavy water reactors designed to operate for 30 years, with a further 30 years available subject to refurbishment. This means the replacement of key components in the reactor core: fuel channels, pressure tubes and feeders.

As the holder of the original design, Candu Energy has taken part in this work several times before at the Darlington, Bruce and Point Lepreau plants in Canada, as well as Wolsong in South Korea and Embalse in Argentina. Candu Energy said it would be sending specialised staff to Romania, while Nuclearelectrica noted it had hired 100 people, some of whom would be spending time in Canada at Candu units that have already undergone this process.

"Romania needs renewed nuclear power capacities for producing clean, stable and affordable energy, as a solution for achieving energy security and the protection of consumers," said Cosmin Ghiță, CEO of Nuclearelectrica. He noted that Cernavoda 1 has met 9% of the country's electricity needs over its 25 years of operation so far while avoiding 125 million tonnes of carbon dioxide.

Romania's nuclear strategy

Nuclearelectrica plans to operate Cernavoda 1 until the end of 2026 and then undertake the refurbishment from 2027 to 2029. Once it is approved for restart by safety regulators, unit 1 should then operate until around 2060. The project therefore represents a major plank in Romania's policy to reach net-zero in terms of carbon dioxide emissions from 2050. The total cost of the refurbishment is estimated at EUR1.85 billion (USD1.85 billion).

Cernavoda 2 will also be a candidate for refurbishment, but it is nine years younger than unit 1 and would be due for this in 2037.

In parallel to refurbishments, Nuclearelectrica wants to complete and bring into service two half-built Candu units at Cernavoda, units 3 and 4. The first contracted work for this, with Candu Energy as well as Sargeant & Lundy, began in November last year. Unit 3 could be in operation by 2031.

A third aspect of Romania's nuclear power strategy relates to small reactors. Last year Nuclearelectrica signed agreements with NuScale towards the goal of bringing one of the US-based company's reactors online in 2028 at Doicești. It was recently announced that this would benefit from USD14 million in US federal support for front end engineering and design.

Researched and written by World Nuclear News

The Bullish Case For Uranium Stocks

By Ag Metal Miner - Jul 25, 2022,

• Staunch opposition to nuclear energy in Japan and Germany is beginning to turn.
• 
  
• Growing demand for cleaner energy sources is giving rise to a potential boom in nuclear plant production.
• 
  
• As the world revisits nuclear power as a potential clean source of energy, uranium stocks could get a needed bump.

Sizewell C plant gains approval highlighting the growing case for investment in uranium stocks as the world shifts towards self-sufficiency.

Friday saw the French energy firm EDF gain approval for their Sizewell C nuclear power plant, as the company seeks to expand on their already established Sizewell B plant in Suffolk. This is a particularly notable breakthrough as it appears to highlight a growing global trend as sentiment softens toward nuclear. Sizewell C has had plenty of opposition in its time, with local protests ensuring that authorities go through four rounds of consultancy from the inception of the project in 2012.

However, events in Russia have fast-tracked efforts to move towards a more self-sufficient energy mix. Unlike most energy sources, which can be massively influenced by geopolitical relationships and pricing fluctuations, the costs associated with a Nuclear power plant are less about the price of Uranium and more about the ongoing running costs of running the plant safely. While the plant will face plenty of further opposition, the question of whether EDF gets this expansion off the ground is less important than the wider picture for Uranium demand.

Staunch opposition in Japan and Germany starts to turn

While the Sizewell C plan faced opposition from 10,000 East Sussex residents, experiences in Fukushima have ensured that pretty much the entire Japanese population stood against turning the reactors back on. However, that is exactly what their Prime Minister plans to do, with Fumio Kishida requesting that his Minister for Industry gets up to nine nuclear reactors operational by Winter.

Germany is another traditionally staunch critic of nuclear power, with the country providing consistent opposition against efforts within the EU to include nuclear energy as a green sustainable investment in its “taxonomy.” However, the evident risk posed by German overreliance upon Russian energy has clearly seen a shift, with the EU finally including Nuclear in their taxonomy which now labels the energy form as being sustainable. This opens the door for European green bonds to invest in nuclear projects for the first time. According to 2021 figures, EDF could have €7.9 billion worth of projects eligible for green funding going forward. That is by far the largest segment in consideration.

Source: Bloomberg

With global attitudes shifting in favour of nuclear once again, we can expect to see demand for the raw material pick up in the coming years. Supply will also likely expand, although it takes time to get a mine operational once again. Recent talk from the United States over the need to swiftly develop the means to produce uranium concentrate highlight to global push towards building a relatively self-sufficient nuclear industry. As the world transitions towards greater electrification, it is also clear that we cannot continue to burn fossil fuels to create that electricity. Just as the EU have now classified, nuclear largely does allow for the creation of energy in a sustainable manner if produced and stored properly.

Related: High Crude Prices Are Here To Stay

While IG does not allow the trade of the underlying Uranium price itself, we can use the Sprott Physical Uranium Trust as a good proxy for underlying price. The comparison below highlights the correlation seen over the course of the past year. We can see that price has largely taken place within a well defined range over much of the past year, with the declines seen throughout global markets helping to dampen elevated sentiment seen in March and April. However, with support coming into play here, the underlying fundamentals behind uranium demand and supply should help elevate prices once again.

Source; TradingView

Yellow Cake

Yellow Cake is the primary uranium investment vehicle in the UK, with the company issuing shares and stockpiling the product over time. We have seen YCA shares similarly head lower over the course of the past three-months, bringing price 28% lower in the process. However, it is notable that price remains above the £2.94 swing-low established in late-February. As long as the price remains above that key pivot level, this stock looks attractive.

Source: ProReal Time

Cameco

Uranium giant Cameco is another trustworthy name in the field, with the producer clearly trending in the right direction despite recent weakness. That decline takes us to 26% below its April high, yet the uptrend is evident on this weekly chart. With that in mind, bullish positions are favoured as long as the price remains above the $18.02 swing-low.

Source: ProReal Time

Global X Uranium ETF

Looking at the wider uranium space as a whole, the Global X Uranium ETF allows for investment into a wide range of companies involved in the mining of uranium and production of nuclear components. Clearly we can see that things are less clear-cut for the bulls here, with the price looking at risk of rolling over. However, the bullish story still remains in play until we break back below the $17.27 swing-low established last August.

Source: ProReal Time

By CityAM

Energy Market Madness Leads To Record-Breaking Coal Consumption

By ZeroHedge - Jul 23, 2022, 

• Coal-fired electricity generation has surged to a record high.
• 
  
• The rise in coal use is being fueled by the ongoing war in Ukraine and booming electricity demand.
• 
  
• Coal-fuelled generation is on course to set an even higher record in 2022 as generators in Europe and Asia minimize the use of expensive gas.

Global coal-fired electricity generators are producing more power than ever before in response to booming electricity demand after the pandemic and the surging price of gas following Russia’s invasion of Ukraine.

The world’s coal-fired generators produced a record 10,244 terawatt-hours (TWh) in 2021 surpassing the previous record of 10,098 TWh set in 2018 (“Statistical review of world energy”, BP, July 2022).

Coal-fuelled generation is on course to set an even higher record in 2022 as generators in Europe and Asia minimise the use of expensive gas following Russia’s invasion and U.S. and EU sanctions imposed in response.

By contrast, mine output was still fractionally below the record set between 2012 and 2014 because older and less efficient coal generators have been replaced by newer and more efficient ones needing less fuel per kilowatt.

Global coal mine production was 8,173 million tonnes in 2021 compared with 8,180-8,256 million per year between 2012 and 2014.

But mine production is also likely to set a new record this year as the surging demand for coal-fuelled generation overtakes efficiency improvements.

Coal Resilience

Coal’s resurgence has confounded U.S. and EU policymakers who expected it to diminish as part of their plan for net zero emissions.

Between 2011 and 2021, generation from coal grew more slowly (1.2% per year)...

... than hydro (2.0%), gas (2.8%), wind (15.5%) and solar (31.7%).

As a result, coal’s share of total generation worldwide has declined 36.0% in 2021 from a recent peak of 40.8% in 2013.

But the enormous growth in electricity demand (2.5% per year) ensured there has been growing demand for all sources of generation.

Coal production and generation is set to continue rising through at least 2027 as the rising demand for electricity overwhelms efficiency improvements in combustion and the deployment of gas and renewables as alternatives.

Turbocharged

Rapid recovery after the pandemic has turbocharged these trends, boosting electricity demand and the dependence on coal-fired generation, and lifting coal consumption to a record high.

Russia’s invasion of Ukraine and the resulting reduction gas exports has stimulated demand even further as generators try to minimise consumption of expensive gas and countries try to indigenise their energy supplies.

In Europe, governments are encouraging coal-burning generators to remain in service for longer rather than closing in case gas flows from Russia cease in winter 2022/23.

Responding to shortages and security concerns, China and India are encouraging domestic miners to raise output to record levels to ensure adequate fuel stocks and cut their reliance on expensive imported coal and gas.

China’s coal production climbed to a record 2,192 million tonnes between January and June compared with 1,949 million in the same period a year earlier and 1,758 million before the pandemic in 2019.

India’s production climbed to a record 393 million tonnes between January and May compared with 349 million a year ago.

Fuel Shortage

Despite the rapid growth in domestic coal production in China and India, there is still a worldwide shortage of fuel, which has sent coal prices to their highest level in real terms for more than 50 years.

U.S. and EU sanctions have intensified upward pressure on prices by re-routing Russian coal to Asia and coal from Australia and Indonesia to Europe, resulting in longer and more expensive voyages.

Coal is the bulkiest and most expensive commodity to transport relative to its value so longer voyages have a direct and significant impact on the landed price paid by power producers.Related: Germany Agrees To $15 Billion Bailout For Uniper

Higher gas prices in Europe are pulling coal prices up in their wake as coal-fired generators scramble to secure fuel in order to be able to run their units for as many hours as possible.

Front-month futures prices for gas delivered in Northwest Europe have climbed to €157 per megawatt-hour from €41 at the same point in 2021 while coal prices have risen to €53 from €16.

If the northern hemisphere winter of 2022/23 is colder than normal, shortages of coal, gas and electricity are likely to become severe and are likely to force some form of energy rationing or allocation. The global coal shortage is part of a wider shortage of energy evident across the markets for crude, diesel, gas and electricity.

In each case, the shortage stems from the strong cyclical rebound from the pandemic and has been intensified by Russia’s invasion of Ukraine and sanctions imposed as a result.

Record prices are sending a strong signal to producers to increase output and to consumers to conserve as much fuel as possible.

Like crude and diesel, however, rebalancing the coal market will likely require a significant slowdown in the major economies to ease the immediate pressure on inventories and give production time to catch up with consumption.

By Zerohedge.com