Santee Cooper claims ownership of Summer equipment

15 May 2019

Santee Cooper has filed a federal complaint seeking a formal declaration that it is sole owner of equipment purchased for the abandoned VC Summer nuclear power plant construction project in South Carolina. The company has also asked the court to require Westinghouse provide it with certification documentation related to the equipment.

Summer unit 2's final containment ring was lifted into place in June 2017 (Image: SCE&G)

The owners of the Summer project - Scana subsidiary South Carolina Electric & Gas Company (SCE&G) and Santee Cooper - decided in August 2017 to abandon the construction of the two AP1000s, following reactor vendor Westinghouse's filing for bankruptcy in March that year.

According to Santee Cooper, SCE&G ceded its ownership in the nuclear project equipment through a "forbearance agreement" to Santee Cooper on 13 December 2018, which was approved by the South Carolina Public Service Commission.

Santee Cooper yesterday filed a complaint in the US District Court for the District of South Carolina, Charleston Division, claiming ownership of equipment bought for the abandoned project. The company has also asked a New York bankruptcy court to dismiss Westinghouse's claim of ownership of the same equipment. That claim, it said, was only filed after Brookfield Business Partners acquired Westinghouse last August, as part of the reorganisation plan approved in Westinghouse's bankruptcy case.

"Westinghouse has no legal claim to this equipment," said Michael Baxley, Santee Cooper senior vice president and general counsel. "Westinghouse never listed this equipment among assets that bankruptcy code required it to disclose, nor did Westinghouse claim this equipment when it retrieved assets left behind after it walked off the site on 31 July 2017.

"Furthermore, on 29 March 2017, Westinghouse rejected the very contract it is using to make its fabricated claim, and the company has not contributed a dime to the maintenance or preservation of the equipment since that date," Baxley continued. "Finally, Santee Cooper and former co-owner SCE&G more than paid for the cost of the equipment while the project was active."

In July 2017, Toshiba Corporation - as the former parent company of Westinghouse - agreed to pay a maximum of USD2.168 billion to SCE&G and Santee Cooper under its guarantee obligations for the two AP1000 reactors under construction as units 2 and 3 of the Summer plant. In late September of that year, SCE&G and Santee Cooper - which held 55% and 45% shares in the project - sold to Citigroup the settlement payments to be made by Toshiba under its guarantee obligations.

Construction began on the first of four AP1000 reactors in the USA - Summer unit 2 and Vogtle unit 3 in Georgia - in March 2013, with work beginning on Summer 3 and Vogtle 4 in November of that year. Work is still continuing at the Vogtle project, for which Westinghouse negotiated a long-term services agreement with co-owner Southern Nuclear Co.

Researched and written by World Nuclear News