Westinghouse and Shaw have signed a letter of intent to create a joint venture for the fabrication and assembly of modules for AP1000 nuclear power plants.
|The AP1000 and its main components (Image: Westinghouse)
Under the terms of the agreement, Westinghouse and Shaw will both hold ownership shares in the joint venture, to be called Global Modular Solutions LLC (GMS). Further terms of the agreement were not disclosed, although final negotiations are expected to be completed by the end of October.
GMS will construct a new facility in Lake Charles, Louisiana. The plant - which will primarily produce structural, piping and equipment modules for new nuclear power plants utilizing Westinghouse's AP1000 technology - is scheduled to begin operating in the third quarter of 2009 and is expected to employ up to 1400 people when fully operational.
JM Bernhard, chair, president and CEO of Shaw, said: "After an extensive search of potential sites, the Port of Lake Charles was chosen because of its deep water access, its proximity to other important modes of transportation and the availability of a skilled workforce. The state of Louisiana also offered a very competitive incentive package that will help us continue to create value for our shareholders."
Dan Lipman, senior vice president for nuclear power plants at Westinghouse, said: "Westinghouse and our consortium partner Shaw Group are providing four new plants in China, and we have been identified for no less than 14 plants here in the United States. Other markets are fast emerging." He added, "It is imperative, therefore, that we move decisively to develop the infrastructure to meet the needs of our fast-growing and essential industry."
Last month a ceremony was held to mark the readiness of a similar AP1000 module factory in China. Shandong Nuclear Power Construction Group built that facility, which has the capacity to support the construction of two AP1000s each year, in just 11 months. A global system of dedicated factories producing identical models should enable far greater standardisation of nuclear power plants - as well as speedier construction.
Toshiba strengthens partnerships
Meanwhile, Toshiba of Japan - majority owner of Westinghouse - is preparing for future nuclear power plant contracts by forming business partnerships with component suppliers, including Ishikawajima-Harima Industries (IHI) of Japan and Doosan Heavy Industries of South Korea.
Company spokesman Ken Shinjo told Agence France-Presse, "We have agreed with Doosan to begin talks on how we can form wide-ranging relations to cooperate in the nuclear power business, including PWRs (pressurized water reactors)". He added that Toshiba has reached a similar agreement with IHI, which took 3% of Westinghouse when Toshiba led its purchase from the UK's former BNFL.
Although Toshiba has not disclosed details of the agreements, the Yomiuri Shimbun newspaper said that Doosan will offer PWR technology to Toshiba in return for orders from the Japanese group for its nuclear power equipment. Toshiba will then offer the PWR technology to IHI so that it can produce steam generation systems for Toshiba's PWRs.
In June, Doosan signed a contract worth some $195 million with Westinghouse for the supply of major nuclear equipment for two AP1000 reactors at South Carolina Electric and Gas' (SCE&G's) existing VC Summer site in South Carolina, USA. The contract closely followed an earlier contract from Westinghouse to supply major equipment, such as steam generators and reactor vessels, for two AP1000s units to be constructed at Georgia Power's Vogtle site near Augusta, Georgia.