Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

Co-operation
between AREVA NP, TVEL and MSZ Elektrostal in the field of manufacturing and supply of nuclear fuel for Western commercial reactors based on Enriched Reprocesses Uranium (ERU)
Ingo Koban AREVA NP GmbH

Evgeny Sannikov

OAO MSZ Elektrostal

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

ERU fuel supply - Story of success

May 20th 2009, MSZ Elektrostal, Hand Over of the 2000th ERU Fuel Assembly to AREVA NP in the presence of the final customer

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

Introduction
AREVA NP has more than 10 years experience with the supply of fuel assemblies made from (re-)Enriched Reprocessed Uranium (ERU) in co-operation with OAO MSZ Elektrostal (MSZ) and TVEL Corporation (TVEL) AREVA NP supplies today 7 European customers with fuel assemblies made from ERU via the co-operation with MSZ Elektrostal and TVEL Up to now manufactured more than 2000 Fuel Assemblies and additional delivered about 185 tU ERU Fuel Pellets Today the yearly delivery volume is between 80 and 130 tU Some of the customers signed with AREVA NP long-term contracts till end of next decade The main reasons for the use of re-enriched Uranium are:
Obligation to use the material coming from Reprocessing Economical advantages: price due to use of own feed material, access to alternative supply chains

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

Start of the co-operation in ERU fuel supply

Beginning from the 198x-ties the anti-nuclear policy in Germany stopped several activities in the nuclear industry In 1994 the decision was taken to stop also the on-going commissioning activities in the new fuel manufacturing plant of Siemens in Hanau, coming under political pressure of the state government Hessen With the closure of the Hanau plant the facilities for the manufacture of MOX- and ERU- fuel from Pu and Reprocessed Uranium (RepU) out of the reprocessed spent fuel were also lost Alternative supply chains for these types were requested and found in France, Belgium, UK for MOX-fuel and Russia for ERU-fuel In the frame of a co-operation agreement with the former Minatom the co-operation between Siemens AG and MSZ was established and after a detailed qualification and certification period the first LTA were delivered in 1996

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

Qualification of MSZ: A Must on the way to a long-term co-operation

An enormous volume of qualification was made successfully: Verification of analytical inspection methods used for the measuring of the key parameters of powders and fuel pellets. Qualification of key process and inspection operations at MSZ and re-inspection of powders, fuel pellets and rods by AREVA NP In-pile testing of lead fuel rods manufactured by MSZ and inserted in the fuel assemblies of AREVA NP which were delivered to Western NPPs. Qualification of fabrication and inspection processes used for the manufacture of lead fuel assembly batches of 1414, 1515, 1616, 18x18 PWR and 1010 BWR fuel assembly designs and in-pile testing in commercial reactors. Qualification of fabrication and inspection processes for any new AREVA NP fuel assembly design to be delivered for Western customers.

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

Certification The other Must

MSZ is now fully certified under ISO 9001 and ISO 14001

since 1995
THE ISO 9001:2000 CERTIFICATE IS ANNUALLY VALIDATED BY THE SUPERVISORY AUDITS CARRIED OUT BY TV CERT

THE ENVIRONMENT MANAGEMENT SYSTEM IS CERTIFIED BY TV CERT FOR COMPLIANCE WITH THE ISO 14001:2005 REQUIREMENTS

IN 2004
7 Ingo Koban, May 27 2009, ATOMEXPO 2009 AREVA NP Proprietary - AREVA NP May 2009 7

Continuous improvement Important to have

New fuel designs from AREVA NP

New manufacturing technologies from MSZ

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

RepU is usually provided by the customer

ERU fuel supply Business model and principles/1

ERU in this co-operation scheme is produced by dry or wet blending of RepU coming from Western commercial reactors with RepU coming from different sources with different enrichments The ERU fuel is used in the standard AREVA NP fuel assembly design, components supplied by AREVA NP ERU Business Model:
REPU Material U308/UO3 Logistics, Warranty & Sales

Enrichment Service

Design & Components,

Manufacturing Service

TAKE OVER/PROVISION OF REPU MATERIAL AND MEU PROVISION BLENDING & CONVERSION

ERU PELLETS ERU FUEL RODS & ASSEMBLY

Utility MSZ AREVA

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

ERU fuel supply Business model and principles/2

Co-operation with MSZ Elektrostal Fuel Plant/Russia is now based on long-term co-operation contract valid till 2020 AREVA NP can order ERU fuel deliveries in form of: Fuel Assemblies or Fuel Rods with provision of all components by AREVA NP to be delivered to the respective NPP Fuel Pellets to be delivered to AREVA NP plants All design documentation is issued by AREVA NP All manufacturing documentation issued by MSY has to be approved by AREVA NP All intellectual property rights regarding the fuel design remains with AREVA NP Transportation of the manufactured fuel with the certified transport containers of AREVA NP

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Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

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Experiences in Western Europe

For 3 German, 2 Swiss, 1 British and 1 Dutch utility regularly ERU reloads were delivered via blending route One Swedish utility ordered in 2002/03 ERU reloads via blending route to spent its RepU stocks. Some customers ordered ERU fuel deliveries without provision of own RepU. In February 2005 the 1000th ERU fuel assembly was delivered, in May 2009 the 2000th ERU fuel assembly was handed over. Several reactors have 100% ERU fuel cores or cores with significant portions of ERU fuel. Delivery contracts until 2020 were signed. About 286.000 fuel rods are up to now inserted in reactors, the failure rate in the first cycle is less than 10-5

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Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

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AREVA NP GmbH fuel assemblies delivered by MSZ (status 12/2008)

Plant

FA-Type

First insertion 1996 2003 2006 1997 2000 1999 2001 2002 2002 2002

Total Number of Fuel Assemblies 76 68 96 220 148 100 184 112 96 528

Maximum FA Burnup (MWd/kgU) 46 51 37 60 47 56 58 58 57 58

D38 D37 D08 D24 D10 D35 D18 D44 D36 C04/15

14x14 15x15 15x15 15x15 16x16 16x16 18x18 14x14 14x14 ATRIUM10

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Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

12

AREVA NP fuel assemblies using ERU fuel (status 12/2008)

Number of Fuel Assemblies

Total Number of Fuel Assemblies: 1.628

250

200

150

100

50

0 5 5 10 10 15 15 20 20 25 25 30 30 35 35 40 40 45 45 5050 55 55 60 60 6565 7070 75 75

Assembly Burnup [MWd/kgU]

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Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

13

Prospects of future co-operation between AREVA NP, TVEL and MSZ

Order volume of ERU fuel in the time period 2008-2019

130 120 110 100 90 80

tU

70 60 50 40 30 20 10 0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Year

And we see more opportunities for ERU deliveries!

14 Ingo Koban, May 27 2009, ATOMEXPO 2009 AREVA NP Proprietary - AREVA NP May 2009 14

Conclusions
The co-operation between AREVA NP, TVEL and MSZ is a good example of successful establishment of alternative fuel supply chains The basis of this success are: Clear vision why to do so Strong support of management and administration High technical and logistical competencies of the partners Successful qualification, certification of all processes and procedures Clear business model with responsibilities, obligations and rights Continuous improvement process

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Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009

15

Co-operation between AREVA NP, TVEL and MSZ Elektrostal in the field of manufacturing and supply of nuclear fuel for Western commercial reactors based on Enriched Reprocesses Uranium (ERU)

Ingo Koban Evgeny Sannikov

AREVA NP GmbH

OAO MSZ Elektrostal

Thank you for your attention!

Ingo Koban, May 27 2009, ATOMEXPO 2009 AREVA NP Proprietary - AREVA NP May 2009

Any reproduction, alteration, transmission to any third party or publication in whole or in part of this document and/or its content is prohibited unless AREVA NP has provided its prior and written consent. This document and any information it contains shall not be used for any other purpose than the one for which they were provided. Legal action may be taken against any infringer and/or any person breaching the aforementioned obligations.

Ingo Koban, May 27 2009, ATOMEXPO 2009

AREVA NP Proprietary - AREVA NP May 2009