Sunday, 16 September 2012

Nuclear nightmare at Nordion

Nuclear nightmare at Nordion: ..."This may not be the end of the trauma for Nordion, the Kanata-based maker of isotopes used in nuclear medicine.
When an arbitrator early this week rejected its claim against Atomic Energy of Canada Ltd., Nordion shares immediately slumped nearly 40 per cent.
The problem discerned by Nordion’s shareholders had little to do with the uncertainty about where the firm will get future supplies of nuclear raw material — the stuff it uses to create products for detecting and treating cancer.
After all, it’s long been known that AECL’s ancient reactor, NRU, will be decommissioned in 2016 — which gives Nordion another four years to line up alternative suppliers, albeit more expensive ones based in other countries.
What investors didn’t like this week were the financial penalties that flow from losing the AECL arbitration. Not only will Nordion forgo compensation from AECL — which four years ago terminated the construction of nuclear reactors that were to have replaced the NRU. But it seems Nordion will be on the hook for covering its own and AECL’s legal fees.
Paradigm Capital analyst Alan Ridgeway estimates Nordion shelled out about $25 million in a losing cause and could pay a similar amount to AECL for its legal costs. (All figures are in U.S. dollars.)" the article states that NRU is set for decommissioning in 2016, however the original government announcement was that NRU will no longer produces isotopes beyond 2016, two different things! "We anticipate Canada will be out of the business," Mr. Harper told a news conference in 2009:   ...NRU has other functions than isotope production including nuclear science and technology research and last but not least is the primary neutron source in Canada...

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