$900 million contract set to ‘accelerate’ Paducah uranium project

The U.S. Department of Energy in January awarded General Matter a $900 million, 10-year contract for nuclear fuel production, which the company said would “accelerate” its uranium enrichment projects in far western Kentucky.

In August, California-based General Matter announced plans to build a $1.5 billion uranium enrichment facility and create 140 jobs at the former Paducah Gas Diffusion Plant. The company previously said enrichment operations at the site would be online “by the end of the decade.”

Enrichment is the process of refining extracted uranium by separating the uranium 235 isotope and increasing its concentration, creating a viable fuel. Nuclear power plants produce electricity by splitting the U-235 atom in a process called fission, which produces heat used to turn a steam turbine connected to a generator.

When the General Matter project was announced, Gov. Andy Beshear called it “the largest economic investment ever made for Western Kentucky.” The company said it signed a “one-hundred-acre, multi-decade lease” with the Department of Energy, which owns the gas diffusion property.

The January award to General Matter is part of a broader, $2.7 billion announcement that the DOE described as an effort to boost uranium enrichment domestically and reduce reliance on foreign fuel. Two other companies, American Centrifuge Operating and Orano Federal Services, also received $900 million in orders from the department.

“Rebuilding America’s domestic enrichment capacity will reduce our reliance on foreign suppliers, strengthen our nuclear industrial base, and reduce energy costs for utilities and consumers,” General Matter said in a statement. “American reactors need American uranium. In partnership with the Department of Energy, we will deliver it.”

General Matter CEO Scott Nolan is a former SpaceX engineer and partner at San Francisco-based venture capital firm Founders Fund. Trump ally and billionaire Peter Thiel, who created the Founders Fund, reportedly joined General Matter’s board last year.

The Energy Department also awarded $28 million to Global Laser Enrichment, which recently acquired hundreds of acres near the gaseous diffusion site and plans to establish its own enrichment operation. The project would create up to 300 jobs, state officials previously said.

The Trump administration has taken a favorable stance toward the nuclear industry, while withdrawing federal support for renewable energy projects across the country. In October, the department canceled a $100 million award to the Ascend Elements battery plant in Christian County, one of the state’s largest ongoing economic development projects.

The gas diffusion plant, built in 1952, produced enriched uranium as a feedstock for the U.S. nuclear weapons program and later for use in nuclear power plants, according to the DOE, which owns the site. Enrichment operations ended in 2013.

Plans for new nuclear investments at the site follow a multibillion-dollar, multiyear cleanup effort to deal with radioactive and hazardous waste that the department says has “led to contamination of soil, groundwater, and surface water” in the area.

In addition to the General Matter enrichment project, state and federal officials have expressed interest in co-locating data center development and nuclear power generation at the Paducah site, the Courier Journal previously reported.

Kentucky has never had an operating nuclear power plant, but state lawmakers in recent years lifted a moratorium on nuclear power and laid the groundwork for the development of new plants. A bill introduced this month in the Legislature would encourage nuclear energy development by opening up millions of dollars in grants for permitting and licensing sites.

Kentucky leaders’ interest in nuclear power comes amid a surge in energy-intensive data center projects in the region, including some projects planned for the commonwealth, which the Republican-led General Assembly has sought to encourage.

Utilities expect these projects to increase energy demand at a historic rate. LG&E and KU, which together make up Kentucky’s largest utility, have planned load increases of up to 45 percent in recent years.

Connor Giffin is an environmental reporter at the Courier Journal. Contact him directly at cgiffin@courier-journal.com or on X @byconnorgiffin.

This article originally appeared in the Louisville Courier Journal: Paducah Uranium Enrichment Project Sees $900 Million Increase