BNFL faces £9bn hole in finances, report reveals

The Government’s plan to privatise British Nuclear Fuels was thrown into further disarray this week following a series of financial disclosures about the company. A leaked report suggested that BNFL has £9bn of liabilities that are unaccounted for. It also claimed that the British taxpayer would have had to put up over £6bn for a […]

The Government’s plan to privatise British Nuclear Fuels was thrown into further disarray this week following a series of financial disclosures about the company.

A leaked report suggested that BNFL has £9bn of liabilities that are unaccounted for. It also claimed that the British taxpayer would have had to put up over £6bn for a cancelled US contract, and that the company’s ageing Magnox nuclear power stations are not commercially viable in the new electricity market.

The disclosures led critics to argue that the company is bankrupt and should be closed, but a BNFL spokesman described this as nonsense, saying many of the liabilities would not be incurred for another 100-150 years.

In another blow for the firm, the US government cancelled a contract to build a huge waste treatment plant at Hanford in Washington state, after BNFL’s final quote for the project rose to over $15bn (£10bn) from a provisional estimate of $6.9bn.

The company said the huge price hike was caused by federal contracting-out policy, which meant it would not receive any payment until it had delivered the first consignment of treated waste – leaving it to finance the project for its first 7-9 years.

BNFL’s decision to shut its Magnox station at Hinkley Point with immediate effect, and most of the others by 2006, indicated they had no long-term viability, the spokesman confirmed.

He said this was due to the cost of measures to persuade the regulator that the plants could continue to operate safely, and uncertain demand for their output in the new electricity market.

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