WASHINGTON, D.C. — A Department of Energy Office of Inspector General report released July 2, 2025, blasts the Office of Nuclear Energy for steering a sole-source High Assay Low Enriched Uranium (HALEU) contract to American Centrifuge Operating, LLC (a Centrus subsidiary), despite clear procurement rules and the company’s shaky finances (DOE-OIG-25-25).

The audit found that Nuclear Energy “bypassed contracting rules outlined in the Federal Acquisition Regulation” and used a pre-award Memorandum of Understanding to lock in Centrus as the only viable provider of the AC-100M centrifuge cascade needed for HALEU production (DOE-OIG-25-25, p. 2).

Key findings of the report include:

• Restricted Competition: The January 2019 Notice of Intent and the May 2019 Justification for Other Than Full and Open Competition contained highly restrictive language that “limited competition” to ACO alone (DOE-OIG-25-25, p. 4).
• Premature MOU: A September 2018 MOU—signed before any public solicitation—committed Centrus to rescind its NRC license amendment request and extend its Piketon facility lease, actions it likely would not have taken “given its financial situation” absent the promise of a contract (DOE-OIG-25-25, pp. 2–3).
• Financial Instability: At award time in May 2019, Centrus’s total debt “was significantly greater than its total assets,” with negative equity and an inability “to pay short-term obligations from assets readily convertible to cash” (DOE-OIG-25-25, p. 5).

Under the Competition in Contracting Act, federal procurements must be competed “as full and open,” with written justification required for any sole-source award. The report concludes that Nuclear Energy skirted these requirements, undermining transparency and potentially costing taxpayers more for less capable competition (DOE-OIG-25-25, p. 6).

“This MOU process limited competition and clearly indicated Nuclear Energy’s intention to award a HALEU contract to Centrus,” the audit states, warning that such actions are “not in the Government’s best interest” (DOE-OIG-25-25, p. 4).

Despite red flags, the Department awarded the contract on May 31, 2019, reduced ACO’s required cost share from 50 percent to 20 percent, and ignored a March 2019 financial desk review that “found Centrus did not have adequate financial resources to fulfill the contract” (DOE-OIG-25-25, pp. 5–6).

The report stops short of formal recommendations—citing the six-year lapse since award—but urges Nuclear Energy to apply its findings “during future procurements, paying particular attention to potential sole source awards” (DOE-OIG-25-25, p. 6).

Advocates for environmental and nuclear watchdog groups warn the audit confirms long-standing concerns: that Centrus’s troubled Chapter 11 history, combined with a tightly controlled procurement process, reflects “acquisition practices that are neither fair nor transparent” and may leave the nation dependent on a single, financially unstable supplier for HALEU fuel.