asked Her Majesty's Government:
Why it was thought right to award the contract for the decommissioning of all 10 Magnox nuclear sites, with 22 reactors, to a single company, Energy Solutions of Salt Lake City, Utah; what is the estimated number of years for which this contract will run; and whether there will be opportunities for other decommissioning providers to bid for the later stages of this work. [HL4228]
In buying Reactor Sites Management Company Ltd from BNFL, after a competitive and rigorous process of pre-qualification against a testing set of criteria, Energy Solutions has also acquired the remainder of the subsidiary's contract with the Nuclear Decommissioning Authority to operate and clean up the 10 Magnox sites. The contracts were signed by Magnox Electric Ltd and are one year in duration with an option to extend. We believe the sale to be in the best interests of the business, its staff and its customer—the NDA.
As stated in the NDA's strategy, the Magnox sites will be split into two regions (north and south) and competed for. The competition for the southern region is already under way; the one for the northern region will commence in 2010. Other decommissioning providers will indeed be able to bid in these competitions.
asked Her Majesty's Government:
Whether the decision to award the contract for the decommissioning of all 10 Magnox nuclear sites, with 22 reactors, was approved by the Nuclear Decommissioning Authority, by the Department of Trade and Industry, and by the relevant regulators; and, if so, how such approval was given and publicised. [HL4229]
The contracts with the Nuclear Decommissioning Authority to operate and clean up the 10 Magnox sites remain with the Reactor Sites Management Company Ltd through its subsidiary Magnox Electric Ltd. BNFL reached agreement on 6 June to sell the business to Energy Solutions, complete with these contracts with one year's duration with an option to extend. As stated in the NDA's strategy, the Magnox sites will be competed for in two bundles (northern region and southern region). The competition for the southern region is already under way; the one for the northern region will commence in 2010.
My right honourable friend the Secretary of State for Trade and Industry announced BNFL's intentions to sell the business in a Statement to the House on 24 October 2006 (Official Report, col. WS85). The sale was undertaken through a competitive process in full discussion with the DTI, as well as with the NDA and the regulators. The DTI approved the sale, as required in BNFL's articles of association, while the NDA is expected formally to approve the change of ownership before the sale is completed later this month.