6th Oct 2008 13:18
AMEC plc
6 October 2008
Sellafield transition agreement
London, United Kingdom (6 October 2008) - The UK Nuclear Decommissioning Authority (NDA) has today entered into a Transition Agreement with Nuclear Management Partners Ltd (NMP). NMP is the consortium comprising AMEC, AREVA, and URS Washington Division. This concludes the formal competitive process to appoint a new Parent Body Organisation (PBO) for the Sellafield Site Licence Company, Sellafield Ltd. The Transition Agreement creates a contractual relationship between the NDA and NMP leading to the transfer of shares in Sellafield Ltd from British Nuclear Fuels Ltd to the new PBO, NMP, scheduled for 24 November 2008.
The NDA competition for a new PBO for Sellafield Ltd was launched on 25 October 2006 and NMP was named as the preferred bidder on 11 July 2008. Following today's announcement, a period of formal transition will culminate in share transfer on the 24 November and, on the same day, the signing of:
a new Parent Body Agreement between the NDA, NMP and Sellafield Ltd
a revised Management and Operations contract between the NDA and Sellafield Ltd.
Samir Brikho, AMEC Chief Executive said:
"The Transition Agreement is a major step towards the creation of a new parent body at Sellafield. From 24 November, AMEC and our consortium members will be contributing world class skills to Sellafield, ensuring that this programme is carried out safely and effectively.
"The programme also provides us with a great opportunity to engage with the skilled nuclear talent which exists in Sellafield. Together we have the potential one day to export UK nuclear competencies and create a sustainable, long-term business for the UK."
Stephen Henwood, NDA Chairman said:
"The successful conclusion of the competition to secure a new parent body for Sellafield Ltd involved a tremendous amount of hard work, drive and determination from all three parties, the NDA, NMP and Sellafield Ltd.
"Work continues to ensure the new parent body is well prepared to take over the control of Sellafield Ltd on 24 November.
"We can look forward to entering into new contracts with NMP and Sellafield Ltd on that day, which we firmly believe will secure world class operations on the site and value for money for the taxpayer."
Impact on earnings
Subject to contract finalisation, AMEC's share of NMP revenues will relate solely to recharges of costs of AMEC management working on the contract, whilst potential annual earnings will reflect AMEC's share of a dividend of up to £50 million, subject to performance against targets agreed with the NDA.
The impact of the contract on AMEC group performance in 2008 will be minimal. Further guidance on the likely impact on AMEC's results for 2009 and subsequent years will be provided following contract finalisation.
Enquiries to:
AMEC plc
Analysts and Investors: +44 (0) 20 7539 5800
Sue Scholes, Director of Communications
Media:
Harold Ashurst, Communications Manager: +44 (0) 7714 709150
Kevin Byram, Brunswick +44 (0) 20 7404 5959
Giles Croot, Brunswick
Notes to Editors:
The Transition Agreement
The Transition Agreement will lead to the signing of a revised Management and Operations contract, a Parent Body Agreement and the transfer of shares in Sellafield Ltd from British Nuclear Fuels Ltd to NMP Ltd, all scheduled to complete on the 24 November. The Management and Operations contract is between NDA and the site licence company Sellafield Ltd. It embodies the delivery of all work across the Sellafield sites in accordance with specified terms and conditions. The Parent Body Agreement is entered into between the NDA, NMP and Sellafield Ltd. It specifies the obligations of the Parent Body as owner of the site licence company in areas such as financing, deployment of key resources and the enhancement of performance in key areas.
AMEC plc
AMEC (LSE: AMEC) is a focused supplier of high-value consultancy, engineering and project management services to the world's energy, power and process industries. With annual revenues of around £2.3 billion, AMEC designs, delivers and maintains strategic and complex assets for its customers. AMEC's Natural Resources, Power and Process and Earth and Environmental businesses employ over 23,000 people in more than 30 countries globally.
AMEC is the largest UK-based private sector supplier of programme management and engineering services to the nuclear sector. The business builds on AMEC's 50 years experience in the nuclear market and customers include BNFL, British Energy, Bruce Power, UKAEA, AWE Aldermaston and a wide range of international nuclear utilities.
Further details on AMEC's nuclear activities were presented at the Power and Process seminar on 5 June 2008 and may be found at
http://www.amec.com/Power_and_Process_seminar
AREVA - is the world leader in nuclear power and the only company to cover all industrial activities in this field. AREVA has developed unique experience in spent fuel and high-level waste management and the company's 58,000 employees are committed to continuous improvement on a daily basis, making sustainable development the focal point of the group's industrial strategy. AREVA has manufacturing facilities in 40 countries and a sales network in more than 100 and offers customers reliable technological solutions for CO2-free power generation and electricity transmission and distribution.
www.areva.com
URS Corporation (NYSE: URS) - is a leading provider of engineering, construction and technical services for public agencies and private sector companies around the world, with more than 50,000 employees in a network of offices in more than 30 countries. Headquartered in San Francisco, the Company operates through three divisions: the URS Division, the EG&G Division and the Washington Division.
Over the last 60 years the Washington Division has developed particular expertise in nuclear engineering and nuclear waste management and is the market leader in the environmental management, nuclear waste management and clean-up of nuclear sites for the US Government. It has the best safety record in the US nuclear industry and from 1989-2008 it was the lead contractor for the Savannah River Site, the US equivalent to Sellafield.
It has also been responsible for the design, construction and operation of the first deep geological repository in the US licensed to dispose of nuclear waste. It has worked in the UK since 1999 as a contractor to BNFL, the UK Low Level Waste Repository and various Magnox stations and has provided consultancy services to the NDA.
www.urscorp.com
Related Shares:
AMFW.L