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Terrestrial Energy Inc. (NASDAQ: IMSR) shares increased by 15% following the announcement of an agreement with the U.S. Department of Energy (DOE) for the TEFLA project, a pilot facility for producing fuel salt for the company's reactor.

The agreement under the Other Transaction Authority (OTA) facilitates an expedited approval process for the TEFLA pilot plant, which will demonstrate fuel production for the Integral Molten Salt Reactor technology. This marks Terrestrial Energy's second OTA agreement with the DOE, following a separate deal for the TETRA test reactor.

The TEFLA project will produce IMSR fuel at a pilot scale using low-enriched standard uranium (SALEU) with less than 5% U235. The fuel produced will supply the TETRA test reactor, developed under the DOE's Advanced Reactor Pilot Program. The agreement is part of the Fuel Line Pilot Program established by Executive Order 14301 to address domestic nuclear fuel resource bottlenecks.