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Caithness News Bulletins January 2006

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UKAEA Goes Into An Alliance To Prepare For Decommissioning Contracts In 2008
The United Kingdom Atomic Energy Authority (UKAEA), AMEC plc and CH2M HILL have formed an important new alliance to target opportunities in the UK’s £56 billion (£2bn a year) nuclear clean up market. The alliance heralds the start of an open and competitive market in UK civil nuclear decommissioning and responds to the government’s landmark decision to open this market to competition.

The alliance will initially target selected sites among the UK’s 20 civil nuclear sites which are now being opened to competition by the Nuclear Decommissioning Authority (NDA). Around half of these are expected to be bid by the end of 2008. Beyond this market, the partners will explore further international opportunities such as the multi-billion pound market in Eastern Europe and the Former Soviet Union, building on the alliance partners’ experience in these regions.

The move will enable UKAEA, a public sector company that has historically led a significant share of the UK’s nuclear clean-up work, to compete on a new and stronger basis in this evolving market.

Dipesh Shah, Chief Executive Officer of UKAEA, said “UKAEA has led the way in decommissioning in this country, including the complete dismantling of 15 of our 26 research reactors, and accelerated programmes for our sites resulting in very substantial savings on lifetime costs.”

“The UK decommissioning market is now opening up to competition, and it is our aim to maintain our leading role. That is why we sought partners who can complement our skills. UKAEA’s private sector partners were chosen from over 70 applicants to create a strong, exclusive and international team. “This alliance complements our own skills and deep knowledge of operating UK licensed sites with AMEC’s commercial and programme management skills and CH2M HILL’s impressive track record in many of the largest and most
complex decommissioning projects in the USA. We are now ready to take on all comers.”

Sir Peter Mason, chief executive of AMEC, said: “This alliance shows that the NDA’s mission of bringing private sector expertise and competition into the UK’s civil nuclear market is working. This team has the right blend of nuclear and commercial skills to win a sizeable slice of the £2 billion a year market.”

Ralph Peterson, President and Chief Executive of CH2M HILL, said: “We look forward to providing the NDA with a compelling option that delivers real value for money. We bring to the alliance a track record of saving the US Department of Energy billions of dollars in safely decommissioning major US nuclear sites. For example, we recently completed the decommissioning of Rocky Flats, the world’s first major weapons facility to be cleaned up and closed, delivering the programme years ahead of schedule with huge resultant savings.”

AMEC and CH2M HILL will immediately second expert staff to join the teams working on UKAEA sites. In October 2004, UKAEA announced accelerated plans for cleaning up its sites, and the seconded staff will help to deliver these programmes and identify further opportunities for acceleration.

About The Partners Of The New Alliance

UKAEA is responsible for the clean-up of its former nuclear research sites at Dounreay, Windscale, Harwell and Winfrith. It also carries out the national fusion research programme at Culham, and manages the international JET facility there – the world’s leading fusion project. With more than 50 years of experience in nuclear site management, it has proven capability in dealing with some of the nuclear industry’s oldest and most complex facilities, and in all phases of site restoration – from programme planning, facility decommissioning, waste management and land remediation, through to release for regeneration. Since April 2005, UKAEA has worked under contract to the Nuclear Decommissioning Authority on its nuclear sites. In October 2004 it announced plans for cleaning-up its sites which accelerated the decommissioning by up to 35 years resulting in savings in cost estimates of over £1 billion. UKAEA is amongst the portfolio of government owned businesses managed on behalf of the government by the Shareholder Executive.

AMEC plc
AMEC plc is an international project management and services company that designs, delivers and supports infrastructure assets for customers worldwide across the public and private sectors. AMEC employs 44,000 people in more than 40 countries, generating annual revenues of around £5 billion. AMEC’s shares are traded on the London Stock Exchange where the company is listed in the Support Services sector (LSE: AMEC.L).  AMEC Nuclear , which employs more than 1,000 people, is the largest UK-based private sector supplier of programme management and engineering services to the nuclear sector. The business was formed following the acquisition of NNC Holdings Ltd in July 2005 and builds on AMEC’s 50 years experience in the nuclear market. AMEC Nuclear’s clients include BNFL, British Energy, UKAEA, AWE Aldermaston and a wide range of international nuclear utilities.  AMEC was recently awarded the Cdn$510 million (£245 million) project management contract to restart two nuclear reactors at the Bruce A power station in Ontario, Canada. AMEC also has a major nuclear waste management contract in the US, where its proprietary technology, GeoMelt, is being used to vitrify intermediate level nuclear waste at the vast Hanford complex in Washington State.

CH2M HILL has its headquarters in Denver Colorado. It is an employee-owned firm, providing engineering, construction, operations and related technical services to public and private clients on a global basis. With more than $3 billion in revenue, CH2M HILL is an industry-leading programme management, nuclear decommissioning, construction management for fee and design firm. The firm’s work is concentrated in the areas of nuclear services, transportation, water, energy, environment, communications, construction and industrial facilities. CH2M HILL has more than 15,000 employees operating in regional offices around the world. The firm’s European/Middle
East headquarters is in London.

NDA Sites
The Nuclear Decommissioning Authority is responsible for the UK’s civil
nuclear liabilities. UKAEA and British Nuclear Group are contracted by the
NDA to manage these sites but it is the intention to compete these
Management and Operations contracts. The 20 NDA decommissioning sites are:
Dounreay, Windscale, Harwell, Culham JET, Winfrith Sellafield, Drigg, Capenhurst, Springfields Berkeley, Bradwell, Calder Hall, Chapelcross, Dungeness A, Hinkley Point A, Hunterston A, Oldbury, Sizewell A, Trawsfynydd, Wylfa