Toshiba is holding discussions with asset management giant Brookfield about taking its stake in the troubled Moorside nuclear project.
Utility Week has confirmed a Financial Times report that the Japanese multi-national is talking to Canadian-based Brookfield about a sale of its UK nuclear unit NuGen, which was set up to deliver the planned 3GW plant in Cumbria.
The talks have commenced since Toshiba stripped South Korean utility Kepco of preferred bidder status in July due to the length of time that it was taking to strike a deal.
Brookfield bought Toshiba’s US nuclear business Westinghouse earlier this year after the latter filed for bankruptcy due to massive cost over-runs on a project it is building in South Carolina.
Acquisition of the Moorside project would give Westinghouse an opportunity to deploy its AP 1000 reactor, which has already secured generic design assessment (GDA) approval from UK regulators. In addition, the AP 1000 has been operating since earlier this year in China. NuGen’s plans would involve the rollout of three AP 1000 reactors.
Kepco would need to secure GDA approval for its APR-1400 reactor, a process which could take three to four years.
Utility Week gathers that Kepco is still understood to be the primary bidder Toshiba is talking to regarding the sale of NuGen.
Toshiba and Kepco are continuing discussions, which also involve the UK and South Korean governments, over the financing of the deal.
The UK government has recently said it is exploring the use of mechanisms to cut the capital costs of new build nuclear projects, including taking share of the risk and allowing investors to receive during the construction phase rather than having to wait until plants are up and running.
However a nuclear industry source expressed doubt that Brookfield will be able to secure a better financial deal than Kepco.
He said: “I doubt if they will be able to secure a better financial deal from the government than Kepco who are struggling to reach agreement.”
Last week, NuGen announced that it will axe more than 60 per cent of its 100-plus strong team on its troubled new build nuclear project at Moorside in Cumbria.
Brookfield manages $285 billion of real estate, infrastructure, renewable power and private equity assets.