USEC and DOE Making Solid Progress Toward Conditional Commitment For American Centrifuge Plant Loan Guarantee

USEC Inc. (NYSE:USU) today reported on the progress of ongoing
negotiations with the Department of Energy′s (DOE) Loan Guarantee
Program office on a term sheet for a conditional commitment for the
financing of the American Centrifuge Plant.

'We are pleased with the progress being made between DOE and USEC staff
to develop the terms and conditions for a conditional commitment,? said
John K. Welch, USEC president and chief executive officer. 'Based on our
recent discussions with DOE, I am optimistic that we can reach an
agreement on terms in the near future and that DOE will then be able to
move promptly to issue the conditional commitment. We want to move
forward as quickly as possible so that we can begin remobilizing
construction of the American Centrifuge Plant, but recognize that DOE
needs to structure an agreement that protects the American taxpayer by
ensuring loan repayment and we are committed to achieving that goal as
well.

'USEC made substantial progress during 2010 to address DOE′s technical
and financial concerns. This had the very positive effect of eliminating
or mitigating project risks. Our cascade of AC100 machines demonstrated
that we have a very solid machine, and the technology is ready to deploy
commercially.

'The American Centrifuge staff has been working closely with DOE′s
independent engineering firm as it prepares a report that will be a key
part of the due diligence process. We believe the report will recognize
the technical progress made since the independent engineer′s 2009 review
of the project.

'We also strengthened the financial foundation of the project in 2010
through the strategic investment of Babcock & Wilcox and Toshiba
Corporation. With Toshiba′s significant assistance, we are also in
discussions with the Japanese export credit agencies for additional
funding of up to $1 billion,? he said.

'During the past year, we saw many signs of support that show DOE values
the American Centrifuge technology that it originally developed. A
cooperative agreement with DOE for cost-sharing during 2010 helped to
support operation of the AC100 cascade, the manufacturing of additional
AC100 machines and refinement of the rotor tube manufacturing process.
We also appreciated DOE′s recent agreement to extend the milestones
included in our original 2002 agreement,? Welch said.

The American Centrifuge technology USEC is deploying requires 95 percent
less electric power to produce low enriched uranium on a per SWU basis
than its current gaseous diffusion technology. This will significantly
reduce both USEC′s production costs and exposure to price volatility for
electricity, the largest production cost component for gaseous
diffusion. The American Centrifuge technology is a disciplined evolution
of classified U.S. centrifuge technology originally developed by DOE and
successfully demonstrated during the 1980s. USEC has improved the DOE
technology through advanced materials, updated electronics and design
enhancements based on highly advanced computer modeling capabilities.

As of December 31, 2010, USEC has invested approximately $1.95 billion
in the American Centrifuge program, which includes $767 million charged
to expense over several years for technology development and
demonstration. Construction on the American Centrifuge Plant (ACP) began
in May 2007 after a construction and operating license was issued by the
U.S. Nuclear Regulatory Commission. Centrifuges have been operated as
part of a lead cascade test program for more than 625,000 machine hours
since August 2007. This gives USEC confidence in the performance of the
technology and provides operating data and experience as the project
transitions to commercial operation. Due to uncertainty of funding, at
the time of an August 2009 agreement with DOE to delay consideration of
USEC′s loan guarantee application, USEC significantly demobilized and
reduced construction and machine manufacturing activities in the
American Centrifuge project. USEC continues limited manufacturing,
assembling and operating of centrifuge machines in the lead cascade test
program and ongoing development efforts pending receipt of funding to
remobilize the project and complete the plant.

During the course of 2010, USEC continued its lead cascade test program
with AC100 machines. Installation of these AC100 machines further
demonstrated the ability of suppliers to build components, assemble the
machines and successfully bring them into operation. More than 400,000
machine hours have accumulated in AC100 machine operations since the
summer of 2009. This cascade was in a commercial plant like
configuration and operates under commercial plant like conditions. These
machines are production-ready and could be deployed in the commercial
plant. During cascade operations, USEC demonstrated that the cascade
operates as designed and that a range of commercial product assays can
be produced for USEC′s customers.

USEC believes the DOE′s Loan Guarantee Program is essential to obtaining
the financing needed to complete the ACP and it has applied for a $2
billion loan guarantee. In late October 2010, following an initial
technical review of USEC′s updated loan guarantee application submitted
in July, DOE provided USEC with a draft term sheet that has served as
the framework for discussions with DOE. Completion of due diligence by
DOE and negotiation of terms and conditions with DOE are the next steps
toward the potential issuance of a conditional commitment. USEC is
working with DOE and its technical, legal and financial advisors to
obtain such a commitment in an expeditious manner. After obtaining a
conditional commitment, USEC will need to conclude final documentation
and to satisfy any technical, financial and other conditions to funding
in order to close on the financing.

In order to obtain a DOE loan guarantee, USEC needs to demonstrate that
sufficient capital is available to complete the project. The Company is
in discussions with Japanese export credit agencies regarding financing
up to $1 billion of the cost of completing the ACP. Their willingness to
provide financing is closely tied to USEC obtaining a DOE loan
guarantee. USEC is also looking to complete the remaining two phases of
a $200 million strategic investment by Toshiba Corporation and Babcock &
Wilcox Investment Company in 2011. The next two phases are conditioned
upon progress in obtaining a DOE loan guarantee and other conditions.
The first phase of the investment of $75 million was completed in
September 2010. USEC cannot provide any assurance that it will be
successful in obtaining any or all of the financing being sought.

In August 2010, USEC announced an estimated cost of approximately $2.8
billion to complete the plant from the point of closing on financing.
The $2.8 billion estimate is a go-forward cost estimate and does not
include USEC′s investment to date, spending from now until closing on
financing needed to complete the plant, overall project contingency,
financing costs or financial assurance. This estimate includes AC100
machine manufacturing and assembly, engineering, procurement and
construction costs and related balance-of-plant work, start-up and
initial operations, and project management. USEC believes risk in the
American Centrifuge project has been substantially reduced since its
initial baseline project budget in 2008 and the new cost estimate is
based on a significantly more mature project scope. USEC continues to
work with suppliers to refine its cost estimates. USEC is seeking
reductions in the project cost and to transition to supplier contracts
that are structured to mitigate cost risk through fixed or maximum price
contracts.

USEC′s current schedule anticipates that it will require approximately
24 months to begin initial commercial operations following the close of
financing needed to complete the plant. USEC also estimates that it will
require about 36 months to complete the plant after initial commercial
operations begin.

In early 2011, USEC′s suppliers are continuing to build centrifuge parts
at a rate of approximately eight new AC100 machines per month, then
assemble and operate them in the lead cascade program. These machines
reflect improvements identified in prior testing and are expected to
operate at a target production level of approximately 350 SWU per
machine, per year. The continued production of machine components helps
to accomplish the goal of having the core manufacturing base in place to
facilitate the ramp up of production when USEC closes on financing to
complete the project in the future.

USEC is also continuing to work with Babcock & Wilcox toward
establishing a joint venture for the manufacture and assembly of AC100
centrifuge machines. B&W employees have been producing the classified
AC100 components at USEC′s American Centrifuge Technology and
Manufacturing Center in Oak Ridge, Tennessee. The joint venture will
establish a single point of manufacturing accountability and will manage
all aspects of AC100 machine production, including supply chain
management through the integration of all suppliers and subcontractors
and the assembly of the machines at Piketon. In 2010, USEC and B&W also
agreed on a non-binding term sheet, including pricing, for the supply by
American Centrifuge Manufacturing of centrifuges and related equipment
for the ACP. USEC is currently working to make the joint venture fully
operational.

USEC Inc., a global energy company, is a leading supplier of enriched
uranium fuel for commercial nuclear power plants.

Forward Looking Statements

This news release contains 'forward-looking statements? within the
meaning of Section 21E of the Securities Exchange Act of 1934 ? that is,
statements related to future events. In this context, forward-looking
statements may address our expected future business and financial
performance, and often contain words such as 'expects,? 'anticipates,?
'intends,? 'plans,? 'believes,? 'will? and other words of similar
meaning. Forward-looking statements by their nature address matters that
are, to different degrees, uncertain. For USEC, particular risks and
uncertainties that could cause our actual future results to differ
materially from those expressed in our forward-looking statements
include, but are not limited to: risks related to the deployment of the
American Centrifuge technology, including risks related to performance,
cost, schedule and financing; our success in obtaining a loan guarantee
from DOE for the American Centrifuge Plant, including our ability to
address the technical and financial concerns raised by DOE and the
timing of any loan guarantee; our ability to reach agreement with DOE on
acceptable terms of a conditional commitment, including credit subsidy
cost, and our ability to meet any required conditions to funding; our
ability to obtain additional financing beyond the $2 billion of DOE loan
guarantee funding for which we have applied, including our success in
obtaining Japanese export credit agency financing of up to $1 billion;
the impact of the demobilization of the American Centrifuge project and
uncertainty regarding our ability to remobilize the project and the
potential for termination of the project; our ability to meet the
November 2011 financing milestone and other milestones under the June
2002 DOE-USEC Agreement; restrictions in our credit facility that may
impact our operating and financial flexibility and spending on the
American Centrifuge project; risks related to the completion of the
remaining two phases of the three-phased strategic investment by Toshiba
Corporation ('Toshiba?) and Babcock & Wilcox Investment Company ('B&W?),
including our ability to satisfy the significant closing conditions in
the securities purchase agreement governing the transactions and the
impact of a failure to consummate the transactions on our business and
prospects; certain restrictions that may be placed on our business as a
result of  the transactions with Toshiba and B&W our ability to achieve
the benefits of any strategic relationships with Toshiba and B&W changes
in U.S. government priorities and the availability of government
funding, including loan guarantees; the competitive environment for our
products and services; changes in the nuclear energy industry; and other
risks and uncertainties discussed in our filings with the Securities and
Exchange Commission, including our annual report on Form 10-K and
quarterly reports on Form 10-Q, which are available on our website at www.usec.com.
We do not undertake to update our forward-looking statements except as
required by law.

USEC Inc.

Investors:

Steven Wingfield, 301-564-3354

or

Media:

Paul
Jacobson, 301-564-3399