Sellafield project over budget by £200m-plus
Last updated at 16:39, Wednesday, 06 June 2012
BRITAIN’S biggest nuclear project, now delayed at Sellafield, has racked up a staggering overspend of anything between £200 million and £270 million of taxpayers’ money.
The Whitehaven News can reveal that the cost of Evaporator D has soared as high as £673 million from its original budget of £397million.
Evap D is Sellafield’s future reprocessing lifeline but there will be no added call on the public purse. The massive extra cost will have to come from the £1.5 billion a year Nuclear Management Partners gets from the Nuclear Decommissioning Authority to run the site. But NMP stands to pay a heavy price in having millions of pounds sliced from the annual fee for good site performance. The cuts will be over three years.
Evap D has to be delivered by Sellafield Ltd and the sub contractor (Costain) won a £297 million design and build contract in 2009.
Asked whether any disciplinary action would be taken over project failures, Sellafield’s top boss Dr Todd Wright told The Whitehaven News in an exclusive interview: “I hope I stand accountable and the appropriate actions are always taken.”
The managing director accepted responsibility but has no intention of resigning.
“I am responsible for this, the buck stops with me, the pounds stop with me, the euro stops with me. It is taxpayers’ money and because of that we are taking it seriously. There are steps I have taken and will continue to take because of Evap D’s unique importance. We have to get it right and learn from it.”
He stressed: “I came here to do a job, I don’t know what tomorrow will bring but I didn’t come here (from America) to do things lightly. I believe in what Sellafield is, has been and can be. I’m going to continue my role to realise that. We have to create calmer waters. I am pleased overall with the performance of Sellafield. Since winning our contract (in 2008) we have realised almost £400 million in efficiency savings.”
Asked about government’s reaction, the MD declared: “I am sure they’re as disappointed as I am, no-one can be more disappointed.
“What we have to do is demonstrate our performance across the company, also with this project to track and deliver like we said it would.”
Pressed on whether NMP’s contract to run Sellafield might come under threat when it comes up for renewal in two years’ time, Dr Wright said: “My job is to safely deliver the performance plan. We brought an excellent team here to realise the vision for Sellafield.”
The NDA says: “Earlier this year it became clear that the previously agreed budget of £397m and the completion date of 2015 were under severe pressure.
“Therefore we instructed its contractor Sellafield Ltd and owners, NMP to review the project and produce a revised plan against which there could be confidence in the delivery. Sellafield Ltd has reviewed and revised its business plan proposing a revised budget of £599m to £673m to complete in 2016.
“We remain fully committed but the revised business case will need to go through the full governance process including approval before we can endorse the new budget and delivery schedule.
“While acknowledging the complexities and constraints of the Sellafield site it is clear that performance on this project has not met the standards expected and as a result this has impacted on the fee earned by NMP for 2011\12 and will continue to impact in 2012\13 and 2013\14.
“The NDA continues to closely monitor performance at Sellafield and hold our contractors to account as necessary.
“We welcome the priority Sellafield Ltd and NMP are giving to drive improvements in project management across the site and secure delivery within agreed budgets and schedule in the future.
“A number of NDA strategic initiatives have matured over the past year to provide a reduction in the long term financial burden to the taxpayer of more than £2.6 billion.
“Rescoping of Evaporator D to negate the need for a fifth evaporator allows the deletion of £600 million in costs from previously accepted plans.”
First published at 11:09, Thursday, 31 May 2012
Published by http://www.whitehavennews.co.uk
I have to agree with Derek. I worked at Sellafield for over 15 years, leaving as a pg10 in the projects group a few year ago. Every major project that has ever been run at BNFL has had time and cost over runs, look at Pond 5, THORP, VIT 1&2, VIT LINE 3, MOX, etc., etc. The list could go on and on and on, and then there's the decommissioning projects!!
If the buck stops with Todd Wright and his executive team the answer is easy, sack them!! In the real world CEO's and executives lose their jobs if they or the company doesn't perform. It appears that Sellafield still isn't in the real world!!I also agree with the comments from Observer. I just looked at the Sellafield Sites website. The majority of the executive team are American, why are we not filling these roles with experienced locals. I'm sure that many great people left BNFL and now hold down very important jobs elsewhere that would be ideal to rejoin Sellafield. I'm sure Sellafield could benefit from experience gained outside of the insular nuclear industry.In the 90's BNFL was sending people to the USA on decommissioning clean-up projects because BNFL had the expertise. Here we are 20 years later with hardly any experienced BNFL people in the Sellafield executive team. Basically it stinks and the Government and the NDA have an awful lot to answer for!!View all 7 comments on this article
Have your say
As announced following the original article, all reprocessing in the uk is to cease in 2018. This evaporator is due online in 2016, it will have a mere two years use. Is it wise to actively commission, or indeed actually complete this project, after all, it is almost double its budget up till now.
I wonder if the announcement of mothballing of evap d may be coming into focus in the NDAs (Governments) crystal ball.
To be fair, it would be the natural progression following closure of Mox, B205, Thorp, and ultimately the Vitrification plants.
These four plants ARE Sellafield, yes there will be jobs to clean up the mess, how many? That is the question for the future of West Cumbria.
Being let down gently is never a good feeling.
Posted by jc747 on 11 June 2012 at 18:11