Britain's Nuclear Decommissioning Authority (NDA) said it would terminate a $7.7 billion contract with Cavendish Fluor Partnership (CFP) that calls for decommissioning 12 Magnox nuclear power sites after just five years owing to a wide discrepancy between the work required to complete the work and the contract that was signed in 2014.
The contract calls for a 14-year decommissioning project, but Energy Secretary Greg Clark said the the first step in the process was called “consolidation,” which is meant to align the work at each of the 12 sites with the tender that was issued in 2012. “CFP started work on the Magnox estate on 1 September 2014,” Clark said, as quoted by the World Nuclear Association. He added, “It has become clear to the NDA … that there is a significant mismatch between the work that was specified in the contract as tendered in 2012 and awarded in 2014, and the work that actually needs to be done.”
Clark said the contract would be terminated in two years, which is the time frame spelled out in the contract for giving notice to cancel the deal. CFP, a partnership between Fluor Corporation and Babcock subsidiary Cavendish Nuclear, has agreed to the termination.
Clark also said that the NDA would use the two years remaining on the contract to draw up specifications for the next tender.
He also said termination of the present contract should not be reflect badly on CFP, only that “dealing safety with the UK's nuclear legacy is fundamental and non-negotiable.”
The NDA also announced that it had reached a settlement with Energy Solutions and Bechtel, two companies who sued over flaws in the original tender process.
The NDA agreed to pay Energy Solutions $96.1 million plus $10.7 million in costs. The Bechtel settlement came to $18.6 million plus $580,355 in costs.
Clark called the error a “defective procurement with significant financial consequences.” He added, “I am am determined that the reasons for it should be exposed and understood, that those responsible should properly be held to account and that it should never happen again.”