EdF Puts On Hold GBP1.2B Nuclear-Related Engineering Contract-Report

EDF Energy, a unit of Electricite de France SA (EDF.FR) has put on hold the award of a GBP1.2 billion civil engineering contract for a new nuclear power station at Hinkley Point in Somerset, England, The Guardian reports Monday.

Two consortiums led by Balfour Beatty PLC (BBY.LN) and Laing O'Rourke were hoping to have heard about the contract in recent days but now expect no decision will be taken until 2013 at the earliest, the U.K. newspaper said, citing John Stanion, chief executive and chairman of construction firm Vinci SA (DG.FR), a partner to Balfour Beatty.

Stanion told industry newspaper Construction News that the GBP1.2 billion contract was unlikely to be awarded until next year. "I think EdF is totally committed to Hinkley Point subject to them having a clear investment case, but I don't think it is in a position to make a decision until [the contracts are] legally brought into forced, so some time next year will be the earliest they will commit," the Guardian reported.

The soonest a new reactor will be built in Somerset could now be 2021, about four years later than originally hoped, it added.

EDF declined to comment to the Guardian, saying "I am afraid it is not our practice to comment on open tenders." The company however insisted that its wider plans remained intact and it aimed to start work on a GBP100 million contract awarded last year to prepare the site "as soon as practicable, and all necessary steps are being taken to ensure that work can start in good time."

EDF plans to build new nuclear power stations in the U.K. but industry experts cited by the newspaper say that uncertainty over the U.K. government's planned support mechanism through "contracts of difference" and French President Francois Hollande, who is skeptical about nuclear power, have encourage EDF to hold off.