Japan Atomic Power takes rare step of selling uranium to pay off loans

Kyodo

A Japanese nuclear power company has taken the rare step of selling some of its uranium, apparently to help repay loans amid its faltering business conditions, according to sources.

Japan Atomic Power Co. apparently needs to secure money to repay loans due in April amid uncertainty over when it can resume operating its three idled reactors.

Tokyo Electric Power Co. is considering taking similar action as it continues to face funding difficulties following the crisis at the Fukushima No. 1 complex, the sources said.

It is rare for a Japanese power company to sell uranium because the material is essential for their reactors and there are few suppliers.

According to the sources, uranium, which could be diverted to military use, is procured in principle under long-term contracts. Japanese utilities import it mainly from overseas suppliers, including in Canada.

While an official at Japan Atomic Power declined to disclose to whom it sold the uranium, it is likely the company returned it to the seller.

A senior official of a major utility said the move was exceptional because it likely meant selling the uranium for less than the import price.

Japan Atomic Power sells electricity to its major shareholders, which include Tepco and Kansai Electric Power Co. Although its electricity output has fallen to zero, it continues to receive “basic charges” paid by major utilities.

According to the sources, Japan Atomic Power plans to pay back ¥40 billion in loans by selling uranium and streamlining. As for another ¥100 billion in loans, major utilities are expected to continue guaranteeing payments beyond April.

In another blow to Japan Atomic Power, a panel of experts appointed by the Nuclear Regulation Authority has agreed that a geologic fault running directly underneath a reactor at the company’s plant in Tsuruga, Fukui Prefecture, is likely to be active.

The judgment, if officially endorsed by the five-commissioner NRA, could leave Japan Atomic Power with no option but to scrap the reactor in Fukui Prefecture.

Plant operators are not allowed to build reactors directly above active faults.