Property, Plant and Equipment

3 Months Ended

Mar. 31, 2012

4. PROPERTY, PLANT AND EQUIPMENT

A summary of changes in property, plant and equipment follows (in millions):


	December 31, 2011			Capital Expenditures (Depreciation)			Transfers and Retirements			March 31, 2012
Construction work in progress	$	1,111.2		$	1.0		$	(2.0	)	$	1,110.2
Leasehold improvements		182.9			-			0.6			183.5
Machinery and equipment		251.2			0.7			1.3			253.2
		1,545.3			1.7			(0.1	)		1,546.9
Accumulated depreciation and amortization		(358.2	)		(6.9	)		0.1			(365.0	)
	$	1,187.1		$	(5.2	)	$	-		$	1,181.9

Capital expenditures include items in accounts payable and accrued liabilities at March 31, 2012 for which cash is paid in subsequent periods.

USEC is working to deploy the American Centrifuge technology at the American Centrifuge Plant ("ACP") in Piketon, Ohio. Capital expenditures related to the ACP, which are primarily included in the construction work in progress balance, totaled $1.1 billion at March 31, 2012 and December 31, 2011. Capitalized asset retirement obligations included in construction work in progress totaled $19.3 million at March 31, 2012 and December 31, 2011.

Beginning in the fourth quarter of 2011, USEC has been spending on the ACP at reduced levels that relate primarily to development and maintenance activities rather than capital asset creation. Additional details are provided in Note 12 under "American Centrifuge Plant – Project Funding." Beginning with the fourth quarter of 2011, all project costs incurred have been expensed, including interest expense that previously would have been capitalized. Capitalization of expenditures related to the ACP has ceased until commercial plant deployment resumes.

USEC believes that future cash flows from the ACP will exceed its capital investment. Since USEC believes its capital investment is fully recoverable, no impairment of the balance of capitalized costs is anticipated at this time. USEC will continue to evaluate this assessment as conditions change, including as a result of activities conducted as part of the research, development and demonstration ("RD&D") program.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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