Decision on $11bn nuclear decommissioning contract imminent

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The Cavendish Fluor consortium has been chosen by the UK’s Nuclear Decommissioning Authority (NDA) to carry out a major decommissioning programme of the country’s 12 nuclear sites.

The NDA approved the partnership as the preferred bidder to take ownership of Magnox Ltd and Research Sites Restoration Ltd (RSRL) and expect savings of at least £1bn to made in the overall decommissioning programme as a result of the decision.

The NDA said: “The proposals submitted by Cavendish Fluor Partnership will take the 12 historic nuclear sites into the final stages of decommissioning and, in line with the NDA’s strategy, will significantly reduce demands on the public purse.

“The competition was based on the key criteria of securing the highest standards of safety UK NDA and environmental performance, together with value for money for the UK taxpayer. Today’s announcement is a key milestone in the two-year competitive process to secure a world-class Parent Body Organisation (PBO) for the two Site Licence Companies. Tenders from four bidding consortia were subject to comprehensive evaluation and scrutiny over the last four months.”

Cavendish Fluor Partnership is a specially created joint venture between Cavendish Nuclear and Fluor Corporation.

A mandatory standstill period and a five-month transition phase now follow while the contract between the NDA and Cavendish Fluor Partnership is finalised and all legal processes are completed. During the transition period, members of the new executive team will introduce themselves to the workforce and the current management team. 

Following successful transition, Cavendish Fluor Partnership will become the new Parent Body Organisation and take ownership via the transfer of shares of two site licence companies, Magnox Ltd and RSRL, on September 1, 2014.

Several private sector consortiums were in the running to take on the $11bn (£7bn) contract to perform the works at Sizewell, Hinkley and Dungeness.

The FT reports that the work is one of the largest and most sensitive public sector contracts to be awarded in the UK so far.

The aforementioned reactors have come to end of their natural life spans and the Nuclear Decommissioning Authority, the government-funded body responsible for Britain’s state-owned nuclear sites, started the competition two years ago, and work is expected to start in September.

Currently the sites are being run by Magnox, a company owned by Salt Lake City-based EnergySolutions. It is bidding for the new work in partnership with Bechtel.

The contract covers Britain’s 10 reactors as well two old nuclear research sites in Oxfordshire and Dorset.

Other consortiums included in the competition were Amec, Atkins and Rolls-Royce; CH2M Hill, Areva and Serco; and Babcock and Fluor. The clean-up contract that the companies hope to take over employs about 3,000 workers on the 12 ageing nuclear sites across the country.

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