The UK Government has announced a £196m ($246m) investment to establish Europe’s first facility for producing HALEU in Capenhurst, Cheshire.

The strategic move aims to diversify the uranium fuel market, currently dominated by Russia, and support the next generation of nuclear energy projects.

The investment will fund the construction of a HALEU fabrication facility at the Capenhurst site of Urenco, a company part-owned by the UK Government.

The facility will begin fuel production by 2031 for both export and domestic use.

With an annual production capacity of ten tonnes, the HALEU from this plant could yield energy equivalent to more than one million tonnes of coal.

The facility will create 400 jobs, reinforcing the north-west of England’s position as a nuclear fuel production hub.

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UK Prime Minister Rishi Sunak stated: “Building our own uranium enrichment plant is essential if we want to prise Putin’s blood-soaked hands off Europe’s energy market.

“Russia has been the sole provider of this powerful nuclear fuel for too long and this marks the latest step in pushing him out of the energy market entirely.

“The wider future of British nuclear remains a critical national endeavour – guaranteeing nuclear and energy security, and reducing energy bills.”

Urenco CEO Boris Schucht stated: “We welcome this government investment, which will help accelerate the development of a civil HALEU commercial market and in turn the development of the next generation of nuclear power plants.

“These plants will have even higher safety standards and lend themselves to quicker licensing and construction processes.”

The initiative is part of the UK’s broader strategy to enhance energy security and meet climate targets by increasing nuclear power capacity to 24GW by 2050. It could account for nearly one-quarter of projected electricity demand.

The funding for this project is part of the larger £300m HALEU programme unveiled in early 2024. The programme aligns with commitments from COP28, where G7 nuclear nations pledged to boost uranium production.