Cameco makes the case for large nuclear reactors

**Dan Testa** (0:02)
Hello, and welcome to another episode of Energy Evolution, the podcast where we hear from experts and executives about the energy transition.
I'm Dan Testa. For this week's episode, I interviewed Grant Isaac. He's the president and chief operating officer of Cameco, a corporation headquartered in Saskatoon, Saskatchewan, in Canada. Cameco is one of the largest miners and refiners in the world of uranium, a fuel for nuclear reactors, and it co-owns Westinghouse Electric, which develops licenses and helps build nuclear reactors. Westinghouse also provides services like fuel and engineering to existing nuclear reactors. So much of the current discussion about nuclear power focuses on quote unquote advanced nuclear.
And that's a term that can encompass a wide range of emerging technologies, from the potential for nuclear fusion to the development of various designs for small modular reactors or SMRs. Many SMR developers aim to address the high cost and construction difficulties of building large light water reactors by building smaller reactors with different designs that can be largely assembled from prefabricated components. Ontario Power Generation is currently building the first of four 300 megawatt SMRs at its Darlington facility, with that first unit expected to connect to the grid in 2030 Regular listeners of this podcast will recall we spoke with the CEO of Ontario Power Generation about that project back in March. But if we ask what new nuclear reactors have been built recently in North America and are up and running right now, the answer is the two reactors at the Vogtle plant in Georgia. And those reactors used Westinghouse's Ap1000 design. Each of those reactors has a capacity of roughly 1,100 megawatts, with Vogtle Unit 3 coming online in 2023 and Unit 4 in April of the following year.
Critics of Vogtle point out accurately that these two reactors took years longer to build than was originally scheduled and cost many billions over the original budget. Westinghouse actually went bankrupt in 2017 due to cost overruns at Vogtle and the VC Summer Plant in South Carolina. Now despite those setbacks, there's a case to be made for investing in more Ap1000 reactors. They're licensed, they're operating, and as we'll hear from Grant Isaac, an impressive learning curve for building them took place between the construction of Vogtle Unit 3 and then Unit 4
There's also significant federal support in the US for building more nuclear capacity right now. In May, speaking on Cameco's first quarter earnings call, Grant Isaac described an effort underway at the US Department of Energy. This effort would provide billions of dollars in financing to order large, long lead components to build up to 10 future Ap1000 nuclear reactors.
This proposed loan guarantee, according to reporting by S&P Global Energy, Platts, would involve establishing five special purpose entities that each secure a set of components and then ownership of those entities would get assigned to a utility when it decides to move forward with building an Ap1000 project. I'll also note here, this is separate from an announcement in October, that the US government is partnering with Brookfield Asset Management, Cameco and other nuclear developers to build 80 billion in new reactors funded through trade agreements with Japan. We're going to hear about some of these prospects from Grant, who I spoke with in March at the Sarah Week by S&P Global Energy Conference. He also talked about how the war in the Middle East has many governments considering energy technologies that don't rely on imported fossil fuel.
But first, he provided a breakdown of Cameco's business and where it's headed.

**Grant Isaac** (3:57)
Think of us as fully integrated across the nuclear fuel cycle as well as now the nuclear reactor cycle. So it begins all the way upstream, largest exploration program for uranium in the world. We operate the two largest uranium mines in the world. We are the second largest producer in the world. And then if we just start working our way downstream, largest refiner of uranium, western world's largest converter of uranium. We're not in the enrichment space yet, but we do have ambitions to be in enrichment. The final service step is fabrication. And that's where our Westinghouse transaction kicks in, because between the fabrication that Cameco does and the fabrication that Westinghouse does, about 65% of fuel bundles that go into western reactors go through our facilities. So really important footprint there. We provide reactor services, reactor components, and now probably the really exciting opportunity is the world is looking to build, the western world is looking to build gigawatt scale nuclear reactors. Again, in Westinghouse, of course, has the best in class gigawatt scale reactor. So we're right across it. We're involved in conversations from where's the uranium going to come from to where's the next reactor going to come from and everything in between. And it's a very exciting time for us.