Following the Nuclear Decommissioning Money Trail

[WritersBlock]

The purpose of this post isn't to start a discussion on the pros & cons of nuclear power. Regardless of your opinion of nuclear power, the already-existing facilities will eventually have to be decommissioned.

The decommissioning contracts, and the companies that are after them, are the subject of this post.

First, a little bit of background. The UK Nuclear Decommissioning Authority (NDA) is being set up to handle, well, nuclear decommissioning in the UK:

From the Department of Trade & Industry website (dti.gov.uk/nuclearcleanup/nda.htm): "Cleaning up the nuclear legacy is a long term process. It is a programme which will cost many billions of pounds over a period of many decades. Ensuring that the necessary skills and resources are in place and that the right jobs get done at the right time to get the best value for the taxpayer is a major undertaking. The Government has decided that this will be best achieved by the establishment of a new public body, the NDA. The NDA will be a national body, established by primary legislation, with responsibility for legacy facilities in the UK. It will have the dedicated skills and capability to oversee the strategic management and direction of legacy clean up."

That was the official line. Now for the juicy bits:

When Sellafield, Aldermaston et al go to the NDA, they will still be managed by the organisations that run them now: BNFL and the UK Atomic Energy Agency (UKAEA). But the management of the sites will be under commercial contracts, and the question is how long these contracts will run and how they will be structured.

The DTI has hired Bechtel, the Californian engineering group with close links to the US government, to advise it on setting up the NDA. This might seem sensible, given that Bechtel has massive experience of nuclear clean-ups, having built the Yukka Mountain depository in Nevada and helped sort out the massive Oak Ridge nuclear site in Tennessee, among other projects. However, the appointment is also highly controversial because there is no doubt that Bechtel ultimately wants to oust BNFL from some of the management and operation (M&O) contracts, maybe even at Sellafield.

<snip>

What worries BNFL is that Bechtel's initial deal with the NDA is going to last for only two years. So four years into the life of the NDA it will be free to bid for these M&O contracts, no doubt armed with all sorts of insider knowledge gleaned from its time as adviser to the NDA. And to make matters worse, these M&O deals will be coming up for tender just as Bechtel is free to bid for them.

Although the DTI is making dark hints about limiting M&O contracts to six months, no one thinks this is realistic on big sites like Sellafield. BNFL is pressing for contracts of five to 10 years to be awarded.

http://www.wise-paris.org/index.html?/english/othersnews/year_2003/othersnews030521a.html&/english/frame/menu.html&/english/frame/band.html (scroll down to 2nd story on the page)

The above is all old news.

Now fast-forward to a couple of weeks ago:

The Independent on Sunday

BECHTEL AND LOCKHEED IN FRAME AS LABOUR PLOTS NUCLEAR SELL-OFF

The government is to enter detailed talks about the sale of BNFL's main operating subsidiary British Nuclear Group and is believed to have contacted two US firms, Bechtel and Lockheed Martin in a move that has outraged potential bidders such as the project management group Amec(AMEC.L: Quote, Profile, Research). Richard Gillingwater was appointed head of the government's Shareholder Executive, a body based in the Cabinet Office with the task of improving the government's performance as shareholder in businesses. The sale of BNFL to Bechtel is likely to set angry tongues wagging because the US firm has been advising the Nuclear Decommissioning Authority on the clean-up process and was initially prevented from bidding for any clean-up contracts for at least two years after the NDA was set up. The BNFL (sic) denied that it had been in talks to sell off BNG.

http://investing.reuters.co.uk/stocks/QuoteCompanyNewsArticle.aspx?type=companyNews&symbol=GUS.L&storyID=50887+09-Jan-2005+RTRS

This bit's worth repeating: (Bechtel) "has been advising the Nuclear Decommissioning Authority on the clean-up process and was initially prevented from bidding for any clean-up contracts for at least two years after the NDA was set up."

But what happens if they buy BNFL, who presently has those Management & Operations contracts for Sellafield and the reactor sites mentioned in the article linked above?

Good question, that:

"The House of Commons' Trade and Industry Committee will hold hearings in early March about the Nuclear Decommissioning Authority, or NDA, at which time the Committee may ask BNFL about reports that it is looking to sell British Nuclear Group, or BNG, the spokesman said. BNG handles the decommissioning of power plants and waste disposal.

Press reports earlier this month said that a team in the Cabinet office, led by former merchant banker Richard Gillingwater, was looking to sell British Nuclear Group, and had approached Bechtel Group (BTL.XX) and Lockheed Martin Corp. (LMT).

http://finance.myway.com/jsp/nw/nwdt_rt.jsp?section=news&news_id=dji-00109520050120&feed=dji&date=20050120&cat=INDUSTRY

So it's all sounding pretty sleazy. Well, just wait; the sleaze index is rising.

After all, just who is Bechtel? Well, to provide some background into the company, I present for your enjoyment excerpts from the transcript of Bremner, Bird, & Fortune's "Beyond Iraq and a Hard Place," broadcast on Channel 4 last year:

JOHN F
"In 1983 they had a number of projects in the pipeline. Including, funnily enough, a pipeline. This would run from Iraq from Jordan. They needed someone to discuss it with Saddam Hussein. That someone was our old friend Donald Rumsfeld, who happened to be in Baghdad as a peace envoy visiting the Iraqi leader."

JOHN B
"He then reported back to George Shultz, who had previously been President of Bechtel, but left to become Secretary of State. He has since rejoined the board."

They go on to name a few of the more interesting players in the "reconstruction" of Iraq. Among them are:

George Shultz
Secretary of State, to George Bush Senior;
Chair of Advisory Board of the Committee for the Liberation of Iraq;
Director of Bechtel.

Jack Sheehan
Member, Defence policy Board;
Senior vice President, Bechtel.

http://www.channel4.com/news/2003/special_reports/images/bremner_beyond_transcript.doc

And last, but not least, back to http://www.wise-paris.org/index.html?/english/othersnews/year_2003/othersnews030521a.html&/english/frame/menu.html&/english/frame/band.html">this story again from May of 2003:

And Bechtel is not the only predator stalking BNFL's business. Last week a seminar was held on the subject of nuclear clean-up contracts. Among the companies attending were Amec, Balfour Beatty, Taylor Woodrow, Robert McAlpine and Kellogg Brown & Root – the last of these being a subsidiary of Halliburton, the controversial contractor formerly run by US vice-president Dick Cheney.

[sweetheart]

1. There's a lotta fat around those decommissioning contracts

Rumour has it that when Bechtel comes in to the dounreay site, there's
gonna be a lotta "changes", as the super-long term inefficient, employed
for life view of permanent decomissining employment really is a bit
fat. That they let an outside firm in, pressures the cozy relationships
that have (at least in the case of Dounreay), created the false
impression in the local economy that it is wise to "invest" in
decommissioning... when in fact, the economy must be prepared to handle
thousands of unemployed as the decommissioning winds up, and no
economic spend is preparing for this eventuality, rather the
ongoing chewing of the fat.

There is a lotta fat at dounrey, and surely as the cuthroat managers
get involved, the economic reality spared people on the ncuelar-taxpayer
dole is gonna be shattered big time. Bottom line, the government should
get better value for money and it isn't. Time to introduce some
competition to get the asses in gear. I can't speak as to the quality
of bechtel, or halliburton, but you've already made that point.

At some point, there should be a public inquiry why billions of pounds
were spent to create a massive mess at dounrey and billions more spent
to clean it up without EVER producing electric power... what a crime.
They could have just given every resident of thurso a million pound
and gotten off cheaper. What can be done, after years of inept
use of public resources, but to shatter the illusion of permanence
using a very competent baddie american company.