Toshiba in talks to build two US reactors

Toshiba is in advanced discussions with NRG Energy, the US-based wholesale power generator, to build two US nuclear power reactors in a deal worth $5.2bn.

If Toshiba secures the deal, it would mark its first standalone success on a significant overseas reactor since purchasing Westinghouse last year for $5.4bn. Toshiba Wednesday night confirmed that it was in discussions with NRG, but added that no final contract had been signed.

A General Electric/Hitachi team is also in talks with NRG, though discussions have dragged on for more than a year. NRG has been soliciting offers to build two 1.35m kilowatt advanced boiling water reactors in Houston, Texas, which are planned to begin operating as early as 2014.

Last June, NRG filed papers with the US Nuclear Regulatory Commission naming Hitachi and GE as the companies that would build the reactors, but negotiations stalled and a final contract has yet to be signed.

Toshiba has focused on the US and China in efforts to more than triple its nuclear sales by 2015 and reduce reliance on semiconductors, which account for half its operating profit.

In December, China awarded a multibillion-dollar nuclear reactor contract to Toshiba/Westinghouse, giving its technology a central role in the expansion of the country’s atomic energy sector.

Competition to design and build nuclear power stations globally will see three large western/Japanese alliances fight it out: Mitsubishi Heavy Industries/Areva; Toshiba/Westinghouse; and GE, which is in partnership with Hitachi.

Consolidation of the nuclear sector comes amid predictions of a boom in the building of plants around the world.

According to Hitachi, whose nuclear unit had sales of about $1.4bn, there are construction plans under way for at least 100 new atomic power plants over the next two decades.

A quarter of those will be built in the US and are scheduled to begin operations by 2020. But many others are expected to be erected in rapidly growing developing nations, such as China and India, to meet rising energy needs amid high oil and gas prices.

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