June 12, 2006

AECL's five-year cleanup strategy for retired nuclear facilities to receive $520M from NRCan

A long-term strategy by Atomic Energy of Canada Limited (AECL) for managing decommissioning and waste management activities at its nuclear facilities will receive $520 million in funding support from Natural Resources Canada (NRCan) over the next five years. The cleanup, announced on June 2 by Natural Resources Canada Minister Gary Lunn at AECL's Chalk River Laboratories near Deep River, Ontario, will address "nuclear legacy liabilities" resulting from research and development activities dating back to the beginning of nuclear technologies and medicine in Canada.

The federal government is legally responsible for managing these wastes, which are distinct from those of the nuclear industry and provincial utilities. The latter deal with the commercial radioactive waste generated by nuclear power plants in Canada.

The main projects to be carried out under the strategy include:

*accelerating the decommissioning of obsolete buildings at the Chalk River and Whiteshell laboratories;

*the design and construction of a new groundwater treatment facility;

*environmental restoration of contaminated lands on AECL-managed sites; and

*construction of new facilities to permit waste processing, storage and long-term management.

AECL-managed facilities include the nuclear laboratories in Chalk River, Ontario and the Whiteshell laboratories in Pinawa, Manitoba, as well as three prototype reactors located in Quebec and Ontario. The company has formed an independent liability management unit whose mandate will be to implement the new plan on behalf of the federal government.

The new strategy is the result of several years of collaboration by AECL and NRCan, undertaken in response to a request from the federal government. It reflects several important changes, including an acceleration in the timing of decommissioning activities and the inclusion of construction and operating costs for new infrastructure and treatment facilities required to permit waste processing, storage and long-term management.

The strategy is consistent with international best practices, incorporating a measured approach to steadily reducing risks and liabilities over the long-term. It also takes better advantage of the current experience, skills and knowledge base available in Canada.

AECL president and CEO Robert Van Adel pointed out that the accelerated decommissioning plan "adopts internationally recognized best practices for decommissioning and waste management. This clearly represents a sustainable and responsible solution to managing environmental issues and ensures Canada addresses them now, instead of passing them on to future generations," he added.

Decommissioning and waste management responsibilities at AECL-managed sites are the result of a wide range of activities, many dating back to the 1940s. They include federal government facilities used during the Cold War (before AECL was incorporated in 1952), wastes received for safe storage from universities, medical facilities, and government and industry sites throughout Canada, and from production of medical isotopes, and research and development (R&D) programs in support of Canada's nuclear industry.

As a nuclear operator, AECL must also decommission facilities at the end of their operating life in accordance with the plans filed with the Canadian Nuclear Safety Commission (CNSC). Decommissioning these facilities will involve safely dismantling the facility and processing any radioactive material for appropriate long-term management.

The $520 million in federal funding is intended to cover the cost of fulfilling the government's obligations for decommissioning and waste management, which are recorded as a long-term liability on AECL's balance sheet. The amount of this liability is based on the discounted value of the estimated future decommissioning and waste management costs (using present value techniques).

Due to the accelerated timing of the program and the need to build and operate facilities for decommissioning and waste management, and the adoption of best practices, the estimated liability has increased to $2,750 million in discounted dollars compared to the previous amount of $431 million. In 2005, AECL restated its liability to reflect the use of new Canadian Institute of Chartered Accountant recommendations on asset retirement obligations.

NRCan will oversee management of the decommissioning funds and project execution by AECL's liability management unit. For its part, AECL will support Natural Resources Canada in public consultations to further develop the long-term strategy. These consultations are expected to begin later this year or early in 2007.

More information is available from Dale Coffin at AECL, 905) 403-7457, E-mail coffind@aecl.ca.

In Vancouver, Greenpeace co-founder Dr Patrick Moore, chair and chief scientist of Greenspirit Strategies, commended the government and AECL's initiative.

"It strikes me that this is a very responsible move on the parts of both the federal government and AECL - it indicates a real understanding of proper stewardship, environmental commitment and of openness and transparency," he said.

The strategy will also serve to enhance public confidence in nuclear energy, particularly Canada's CANDU technology, Dr Moore continued. "Through employing best practices in site decommissioning and waste management, nuclear energy can maintain its important position as the only non-greenhouse-gas-emitting power source that can effectively replace fossil fuels while satisfying our increasing demand for energy," he commented.

Dr Moore's company, Greenspirit Strategies, is a Vancouver-based sustainability consulting firm advising clients around the world on topics relating to energy, forestry, biotechnology, aquaculture, plastics and mining. More information is available from Dr Patrick Moore, 778/995-4122.

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