UK Strips Consortium Of Sellafield Contract

Posted by NucNet on 13 January 2015 in NucNet


The UK government has stripped private consortium Nuclear Management Partners (NMP) of the contract to clean up the Sellafield nuclear site in Cumbria, northwest England.

The Department of Energy and Climate Change (Decc) announced today that ownership of Sellafield Ltd, the company that manages and operates the site, will revert to the Nuclear Decommissioning Authority (NDA) from NMP, which took control of Sellafield Ltd under contract to the NDA, a public body, in2008.

Decc said “new, simplified management arrangements” will be introduced at Sellafield to ensure the long-term success of the clean-up programme.

Energy minister Ed Davey said under the new arrangements, Sellafield Ltd will become a subsidiary of the NDA and will be led by a team appointed and governed by a newly-constituted Board. He said the transition to the new arrangements is expected to take about 15 months.

NMP, a consortium made up of URS of the US, British company Amec and France’s Areva Group, has been the parent body organisation for Sellafield Ltd, which is licensed by regulators to operate the site for the NDA.

In 2013, the NDA extended NMPs’ Sellafield contract for five years, but the decision was criticised by the House of Commons public accounts committee, which said the contract “must be terminated” if NMPs’ performance did not improve.

The committee said timescales at Sellafield had slipped, costs had escalated substantially and reprocessing targets had been missed. It said NMP had been appointed in 2008 to improve the performance of Sellafield Limited. However, little improvement had been achieved for extra money spent.

“NMP has not provided the leadership and strong contract management skills that are critical for the success of the major projects at Sellafield and the running of such a large and complicated site,” the committee said.

In June 2014, the NDA said the total cost of work to clean up the Sellafield site would be £79.1 billion, an increase from a February 2013 estimate of £67.5 billion. The NDA said the increase reflected the cost of “additional work”.

The public accounts committee said estimated costs of seven of the 14 major projects at Sellafield had increased significantly and target completion dates for eight of the projects had slipped between March 2012 and September 2013. For example, the estimated cost of the ‘Magnox swarf storage silos retrievals’ project increased from £387 million in March 2012 to £729 million in September2013. The estimated cost of the ‘Pile fuel cladding silo’ increased from £341 million to £750 million over the same period.

NMP receives fees for improved performance at Sellafield in the form of dividends. Those dividends totalled some £50 million in 2011-12 and were expected to total £230 million over the five years of its initial contract from 2008 to 2012, the committee said.

Decc said Sellafield consumes 60 percent of the NDA’s £3 billion annual budget and houses the vast majority of the UK’s civil nuclear waste.

The Sellafield site comprises of a range of nuclear facilities, including redundant facilities associated with early defence work, as well as operating facilities associated with the Magnox reprocessing programme, the Thermal Oxide Reprocessing Plant (Thorp), the Sellafield mixed oxide (MOX) fuel plant and a range of waste treatment plants.

It began life in the early 1950s making plutonium for nuclear weapons, and later that decade became the location of Calder Hall, the world’s first commercial nuclear power station.