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10 Conversion to LEU-Based Production of Molybdenum-99: Prospects and Feasibility
Pages 114-141

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From page 114...
... . The first charge calls on the National Academies to assess "the feasibility of procuring supplies of medical isotopes from commercial sources that do not use highly enriched uranium [HEU]
From page 115...
... In August 1996, AECL agreed to construct two new reactors and a processing facility for MDS Nordion at the Chalk River site. These facilities, referred to as the Dedicated Isotope Facilities (DIF)
From page 116...
... transfer of ownership of the DIF from MDS Nordion to AECL, assumption by AECL of all future capital and operating costs, and a $25 million cash payment to MDS Nordion. In return, AECL agreed to supply medical isotopes to MDS Nordion under a 40-year revenue-sharing arrangement.
From page 117...
... governments concerning the conversion of medical isotope production and processing facilities to LEU.   As noted in footnote 6, the committee obtained copies of correspondence between DOE and Argonne National Laboratory concerning Argonne's work for AECL and MDS Nordion during this Phase 2 program.
From page 118...
... The committee agrees with the MDS Nordion representative's assessment that conversion prior to hot commissioning is the most attractive alternative from both a timing and cost standpoint. In fact, it would have been even more attractive from a timing and cost standpoint to have d ­ esigned the new reactors and processing facility to irradiate and process LEU targets: AECL and MDS Nordion could have continued to irradiate and process HEU targets in its current facilities (the NRU reactor and hot cell process line)
From page 119...
... At present, MDS Nordion has no business reason to convert to LEU-based production under its current agreement with AECL. Even if a business case could be made, however, MDS Nordion might be reluctant to foot the costs of conversion without some assurance of a long-term commitment by AECL to produce Mo-99.
From page 120...
... The initial focus of this assessment is to develop an LEU target that is usable in the ­ allas reactor, which is being planned to replace HFR in about 2016.14 P NRG will then determine if this LEU target can be used in HFR. NRG staff told the committee that development work on LEU targets could be supported by experimental irradiations within the current HFR operating license but would require a change in NRG's hot cells (to allow it to process LEU targets)
From page 121...
... Because of the large number (10) of available hot cells for Mo-99 production in its Petten facility, Mallinckrodt would appear to be well positioned to convert to LEU-based production without the need for major new construction, especially if it could use a hot cell elsewhere on the site or at another site for process development work.
From page 122...
... As noted in Chapter 3, IRE currently processes its HEU targets in a dedicated bank of hot cells. It has a backup set of processing hot cells that are rarely, if ever, used for target processing, and a third set of hot cells that are used intermittently for strontium recovery.
From page 123...
... needs for such isotopes; 2. Sufficient quantities of medical isotopes are available from low enriched uranium targets and fuel to meet United States needs; and 3.
From page 124...
... However, this literal interpretation is not helpful for differentiating between the technical feasibility of producing significant quantities of medical isotopes (and specifically the isotope Mo-99) using LEU targets and the economic feasibility of such production.
From page 125...
... needs. At present, there are not sufficient quantities of medical isotopes available from LEU targets to meet even a fraction of U.S.
From page 126...
... The committee used the following approach to perform this assessment: First, the committee estimated the additional revenues that would be available to support conversion to LEU-based Mo-99 production if the average costs at these three points in the supply chain were increased by exactly 10 percent. Then the committee assessed whether these additional revenues would be sufficient to support conversion to LEU-based production if they were made available to current large-scale HEU-based producers in proportion to their market shares for Mo-99 production.
From page 127...
... TABLE 10.1  Present Values of Potentially Available Revenues from a 10 Percent Increase in the Average Unit Costs at Three Points in the Mo-99/Tc-99m Supply Chain Present-Value Estimates (real discount rate) c 7% 3.5% Number of Present Value of Present Value of Present Value of Present Value of Average Annual Units 55-Year Revenue 30-Year Revenue 55-Year Revenue 30-Year Revenue Point in Supply Unit Cost Sold in U.S.
From page 128...
... . One could make arguments for using either discount rate because medical isotope production is a publicprivate partnership activity as discussed in Chapter 3.
From page 129...
... 19The committee judged that global, rather than U.S., revenues should be used for this analysis because the two suppliers to the U.S. market, MDS Nordion and Mallinckrodt, are global producers.
From page 130...
... As shown in Table 10.1, considerably more revenue would be available to support conversion if the 10 percent cost increase were applied at either of the other two points in the supply chain. The revenues available to individual producers for conversion can be estimated by multiplying $175 million by producers' market shares (Table 3.1)
From page 131...
... Each process line would have either three or four hot cells plus one additional common cell. Consequently, the committee judges that the $70 million in additional revenues available to MDS Nordion is probably more than sufficient to convert within existing facilities at the Chalk River site, even if some refurbishment of hot cells is required.
From page 132...
... This cost increase is less than the 10 percent feasibility criterion mandated by Congress. However, the committee emphasizes again that HEUbased production costs are producer specific, and the variable costs of producing Mo-99 from LEU-based systems will also be producer specific and will depend on the conversion pathway selected.
From page 133...
... Although the analysis presented in this section has not addressed the impacts of medical isotope cost increases on the prices for such medical procedures, those impacts can be easily assessed. Note that cost increases near the top of the supply chain (e.g., cost increases for Mo-99 production)
From page 134...
... have acknowledged the security concerns that are driving global HEU minimization efforts, and representatives of two of those producers (Mallinckrodt and MDS Nordion) told the committee that they see conversion as inevitable if commercially feasible (see also NNSA and ANSTO, 2007)
From page 135...
... DOE The committee judges that DOE, and specifically NNSA, can also take additional steps to improve the feasibility of conversion. First, DOE can ­ expand on the good work being carried out by Argonne National Laboratory and the Idaho National Laboratory that is currently supporting conversion (see Chapters 2, 3, and 7)
From page 136...
... The committee was told by DOE that its sales prices for enriched uranium for research reactors and targets includes all costs associated with the production of the enriched uranium product. This includes the fair market value for the uranium starting material as well as the full costs for the services required to produce the finished enriched uranium product.
From page 137...
... For example, the department negotiated the 1997 memorandum of understanding with the Embassy of Canada on conversion of medical isotope production to LEU (footnote 24) and is an important partner with the DOE on the Global Threat Reduction Initiative (GTRI, see Chapter 11)
From page 138...
... Past efforts to restrict the use of U.S.-origin HEU for medical isotope production have so far been unsuccessful. Congress has at least two options for using its control of the U.S.
From page 139...
... origin HEU for medical isotope production in new reactors. As noted in Chapter 3, at least two new reactors are expected to come online in Europe over the next 8 years.
From page 140...
... • The anticipated total cost increase from production of medical isotopes without the use of HEU would be less than 10 percent for at least three of the four30 current large-scale producers (Mallinckrodt, IRE, and MDS Nordion31)
From page 141...
... Consider additional controls on the use of U.S.-origin HEU for medical isotope production and incentives to technetium generator producers that purchase LEU-based Mo-99 to motivate conversion and the development of domestic sources of Mo-99. Specific actions that could be taken are described in the preceding section.


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