Following the inquiries received from the mass-media, after the publication of an information notice on the agenda of the SNN GMS scheduled for 09.12.2016 on the cancellation of the technical, economic and legal study regarding the reorganization of the exploitation and preparation of uranium ore and nuclear fuel production sector, Societatea Nationala Nuclearelectrica SA (“SNN”) makes the following statements:

Currently, SNN ensures the supply of sintered uranium dioxide powder (UO2) necessary for the operation of the two nuclear units in Cernavoda by procurement from its two qualified suppliers: CNU and the Canadian company Cameco, qualified since 2008, on the basis of the most advantageous price, in the market context and with the observation of the applicable legal requirements.

Considering:

• The fact that the technical, economic and legal study regarding the reorganization of the exploitation and preparation of uranium ore and nuclear fuel production sector cannot be developed due to the fact that CNU refused to sign the contract with the selected consulting company, milestone provided in the association agreement previously signed between SNN and CNU;
• The fact that SNN initiated in 2016 two international qualification procedures for new suppliers of uranium dioxide sintered powder which did not lead to the qualification of additional suppliers since the technical specifications of UO2 required by the Pitesti Nuclear Fuel Plant were not met by the bidders;
• The fact that SNN is responsible for the reduction of the risks associated to operation and ensuring of the necessary raw material on the long term, including the risk of major dependency on one supplier;
• The fact that SNN considers it important to maintain the complete national nuclear fuel cycle in the regional strategic context and in compliance with the business strategy to mitigate and eliminate risks with major impact;
• The fact that CNU is currently dealing with a series of economic and financial problems, however, it benefits from the aid provided by the Romanian state for restructuring.

SNN has analysed potential strategic measures with medium and long term impact to manage this situation, considering the internal and external factors mentioned above and will initiate the necessary steps towards the relevant authorities in order to identify practical cooperation possibilities with CNU (for example: a processing contract with CNU – SNN would purchase the uranium octoxide (U3O8) from the market and contract CNU for its processing into uranium dioxide (UO2)) or to develop additional processing and refinement capabilities and/or upgrade of the existing ones in Romania. Thus, SNN would ensure the security of supply of uranium dioxide sintered powder (UO2) in compliance with the technical specifications for the manufacturing of the CANDU 6 type nuclear fuel bundles and would mitigate the risk of dependency on a single supplier, maintaining a strategic business relation with CNU to the benefit of both parties, at the same time.