Delay for nuclear plant 'could cut investment in UK'

FAILURE to start British Nuclear Fuels' new reprocessing plant at Sellafield could imperil future Japanese investment in the United Kingdom, according to the company's chairman, John Guinness.

Mr Guinness said that BNFL's new Thermal Oxide Reprocessing Plant (Thorp) 'epitomises all that Mr Major is talking about in the reindustrialisation of Britain. It is a vast plant at the frontiers of technology and two-thirds of its business, by volume, is export oriented.'

The company had hoped to start testing Thorp in October last year by processing lightly radioactive uranium. However, this cannot be done without the permission of the Department of the Environment and the Ministry of Agriculture, which are considering how much radioactivity the new plant would be permitted to discharge into the environment.

Best estimates now are that the plant will not be open before May or June at the earliest. The plant, with its associated pollution control equipment, cost nearly pounds 2.8bn, and the delay was costing the company pounds 2m a week, Mr Guinness said. He decried the 'double jeopardy' which BNFL found itself in. The plant was given the go-ahead in 1978, following the long-running Windscale Public Inquiry, but could be subject to a second public inquiry under new pollution legislation.

Mr Guinness suggested that private companies would be dissuaded from setting up new plants in Britain if they felt that, once they had made their capital investment, they might have to undergo a further public inquiry, with the possibility that they might be denied permission to operate the plant they had already built.

Specifically, if Thorp faced a second public inquiry, it could affect Japanese confidence in Britain as a secure investment. Mr Guinness pointed out that much of the new Thorp plant had been paid for in advance by money from the company's Japanese and German customers. 'The chairman of our biggest Japanese customer is chairman of Japan's CBI and if he sees his investment not going ahead, what is he going to say to his colleagues about investment in Britain?' Mr Guinness asked.

However, BNFL was confident 'we're going to get the right answer' from the Government and was already seeking additional orders for the second 10 years of Thorp's operations. 'Forty per cent of our capacity for the second 10 years is filled. Precious few companies have that and we are actively seeking pounds 3bn of contracts to bring the second 10 years up to 100 per cent.'

Thorp takes spent nuclear fuel from light water reactors and separates the reusable plutonium and uranium from the radioactive wastes. Mr Guinness sees most of the plutonium going back to BNFL's customers in the form of mixed oxide fuel - a mixture of plutonium and uranium - for reuse in nuclear reactors rather than as pure plutonium.

The company has built a demonstration plant for the manufacture of Mox fuel near Thorp on the Sellafield site and expects to decide later this year on whether to expand capacity by building a commercial-scale manufacturing plant.