EDF Awards £2 Billion Hinkley Point Nuclear Contract

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) --The U.K.'s first new nuclear build project in 20 years is moving ahead following the selection of the winner for the civil engineering contract worth £2 billion ($3.14 billion).

EDF Energy, the U.K. arm of French energy company Electricite de France (EPA:EDF) (Paris), has selected a joint venture formed by Bouygues SA (EPA:EN) (Paris) and Laing O'Rourke (Dartford, England) as the preferred bidder for the civil engineering work on the proposed Hinkley Point C nuclear power plant in Somerset, England. The work, which will involve around 4,000 workers, is still subject to planning consent and EDF making its final investment decision by the end of the year. Commissioning of the new plant is scheduled for 2018.

"This was a close, very competitive tender which attracted some high quality and robustly-costed bids," admitted EDF Energy Chief Executive, Vincent de Rivaz. "The agreements announced today show we are continuing to maintain momentum in 2012 towards our final investment decision. We will work with Bouygues TP/Laing O'Rourke Joint Venture over the next few months to ensure we are in the best possible position to begin work on site once the investment framework and permissions are in place. For us, early engagement with key contractors is critical to ensure that they are clear on their responsibilities and the expectations we have of them."

Work is already underway for Hinkley Point C. In December last year, Kier Group (KIE.LN) (Bedfordshire, England) and Bam Nuttall, a subsidiary of The Royal BAM Group (BAMNB:EN) (Bunnik, Netherlands), were selected by EDF as the preferred joint venture bidders for site preparation works worth £100 million ($155 million). For additional information see December 15, 2011, article - Hinkley Point C Nuclear Power Plant's £100 Million Site Preparation Contract Awarded to Kier Bam.

De Rivaz said that 2012 is a "defining year" for new nuclear in the U.K.

"We will continue our discussions with Government about agreeing a legally robust investment framework," he said. "Agreeing the contract for difference is key - as I said at the recent Energy and Environment Select Committee hearing -- it means that we and Government will have to be clear about our costs before we sign a contract for our project."

EDF has published plans to build four new nuclear plants, depending on the investment conditions. The plants could generate up to 40% of the U.K.'s total electricity. In March, EDF Energy postponed one of its planned new nuclear power plants at the Heysham site in Lancashire, England. For additional information see March 20, 2012, article - EDF Drops One of its UK Nuclear Projects.

Commenting on the contract win, Ray O'Rourke, Laing O'Rourke Chairman and Chief Executive said: "We are delighted, along with our partner Bouygues Construction, to be appointed by EDF Energy as preferred bidder to lead the development of the first new nuclear power station, which is vital to meet the U.K.'s future energy demands and support the wider economic recovery."

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