Point Lepreau nuclear station in New BrunswickThe Canadian Press
New Brunswick is demanding that the federal government cover more than $720-million in costs that were incurred by the province as a result of Atomic Energy of Canada Ltd.'s mounting problems at the Point Lepreau nuclear reactor.
With the job already a year behind schedule, federally owned AECL informed the province this week that further problems with refurbishing the Candu 6 reactor will delay the project for at least another year, to October, 2011, at the earliest.
The Crown corporation - which Ottawa is attempting to sell to private investors - has been counting on the refurbishment business to provide much-needed revenue as it has faced a drought in reactor sales.
But both of its current Canadian jobs - the New Brunswick one and a project at Ontario's Bruce Power - are behind schedule and over budget, and Ottawa has provided it with some $220-million in the past two years to cover the cost overruns.
In an interview Friday, New Brunswick Energy Minister Jack Keir said the province wants the Harper government to agree to mediation over its demand that federal taxpayers should not only cover the company's costs but the added expense to New Brunswickers from the prolonged shutdown of the reactor.
He said he made the suggestion on Friday in a phone call to Natural Resources Minister Christian Paradis, whose office refused to comment on the matter afterwards.
"I said to him: 'Why don't we get an independent person to look at the contract and come up with recommendations that would be fair to the province and the feds,' " Mr. Keir said. "He agreed to look at our proposal and get back to me."
New Brunswick has been demanding that the federal government help cover the cost of AECL's first delay, but Ottawa has refused to do so. Mr. Keir estimates the cost of replacement power and keeping a skeleton crew at Point Lepreau will cost the province $720-million over the two-year delay.
Ottawa is in the midst of attempting to sell the commercial division of AECL, which includes reactor sales and servicing but not the Chalk River research laboratories. Mr. Paradis said recently that he expects to complete a deal by the end of the year, although he did not say whether Ottawa would remain a minority partner.
AECL has promoted its refurbishment business as a key part of the commercial operations.
Hydro-Québec has announced plans to refurbish its Candu 6 reactor at Gentilly. But it now says it is monitoring AECL's effort in New Brunswick as well as a similar project in South Korea before deciding whether to proceed.
Ontario Power Generation is planning to refurbish the four 900-megawatt reactors at its Darlington plant at a cost of up to $10-billion. The provincial utility expects each reactor will be off-line for 36 months, though AECL is exceeding that downtime at Point Lepreau.
AECL spokesman Dale Coffin said the company experienced problems after installing 380 new calandria tubes - a key part of the reactor's core - and is still working out a solution. AECL is also refurbishing a Candu 6 reactor in South Korea but was able to avoid the problems that arose at Lepreau.
"We believe strongly that the life-extension business is a good business for us," Mr. Coffin said. "It's the first-of-a-kind challenges that have created this problem [at Lepreau] but I think we've shown we can overcome those challenges and apply the lessons learned."
But Mr. Keir said New Brunswickers should not be paying "for AECL to get up the learning curve."