SPX Obtains $100 Million Specialty Valves Contract for Westinghouse AP1000 Nuclear Plants

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Researched by Industrial Info Resources (Sugar Land, Texas)--High-end nuclear engineering design and manufacture has advanced along with the demands of the nuclear power generation sector. Now that a nuclear-power building program is taking shape in the U.S. after a gap of more than 30 years, contracts for component-manufacturing companies and specialized heavy engineering companies are becoming available.

With the prospect of up to 12 new Westinghouse Electric AP1000 nuclear power plants being constructed in the U.S. and China through 2020, SPX Corporation's (NYSE:SPW) (Charlotte, North Carolina) latest agreement with Westinghouse Electric Company LLC (Monroeville, Pennsylvania) to provide highly specialized squib valves for the nuclear installations has a combined value of more than $100 million. SPX's Flow Technology segment has a well established relationship with Westinghouse and currently supplies control, isolation and rotary valves for nuclear plants in China, Spain, Brazil, Japan, Mexico, the United Kingdom and South Korea.

In 2008, Westinghouse signed engineering, procurement and construction (EPC) contracts to provide various AP1000 nuclear power plants. The first nuclear power plant contracts to be signed since 1978 in the U.S. were for the Alvin W. Vogtle plant near Waynesboro, Georgia, and the V.C. Summer Nuclear Station in Jenkinsville, South Carolina, with the South Carolina Electric & Gas Company. Both projects will be supplied with two AP1000s. In January of this year, Westinghouse and The Shaw Group Incorporated (NYSE:SGR) (Baton Rouge, Louisiana), signed an EPC contract with Progress Energy Florida (St. Petersburg, Florida), a subsidiary of Progress Energy Incorporated (NYSE:PGN) (Raleigh, North Carolina), to supply two AP1000s to the nuclear project site in Levy County, Florida. The AP1000 has also been identified as the new plant technology of choice for five nuclear projects that are not yet fully confirmed.

SPX is also engineering and manufacturing specialty valves to be used in four Chinese nuclear plants that will be supplied with AP1000s by Westinghouse under an agreement with China's State Nuclear Power Technology Corporation signed in 2007. The nuclear power stations will be sited in Sanmen, Zhejiang province, and Haiyang, Shandong province. Each plant will be constructed in two phases, and the first unit is scheduled to be operational in 2013.

SPX valves will play a key role in the operation of the AP1000s, which is based on standard Westinghouse pressurized water reactor technology, which has 2,500 reactor years of successful operation behind it. The modular design and 1,100-MW power generating capacity of the AP1000 makes the unit suitable for base-load generation and promotes ready standardization and high construction quality. Advanced instrumentation and control systems enable ease of operation, and specialty valves play a key role in the failsafe features of the AP1000.

In January of this year, SPX announced two contracts worth a total of $51 million for the provision of dry cooling systems for two Chinese thermal power stations in Hequ, Shanxi province, and Haibowan, Inner Mongolia. The contracts will be serviced through the Chinese subsidiaries of SPX's thermal equipment and services segment. Delivery of the equipment will start toward the end of 2009, and the power plants are expected to be operational in 2010.

Westinghouse supplied the world's first pressurized water reactor in 1957 in Shippingport, Pennsylvania, and the company's technology is the basis for about 50% of the world's operating nuclear plants, including 60% of U.S. plants. SPX focuses on providing solutions that support the expansion of global infrastructure with an emphasis on the energy and power sector.

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