By Frank Pingue
TORONTO (Reuters) - A consortium led by TransCanada Corp.
TransCanada said Bruce Power, the private consortium that operates the nuclear station, and the Ontario Power Authority of the provincial government reached a deal to restart two idled reactors and refurbish two others at the Bruce A plant on Lake Huron, 250 km (160 miles) northwest of Toronto.
TransCanada's share of the program will be about C$2.1 billion, giving it a 47.4 percent stake in the newly formed Bruce Power A Limited Partnership. The other members of the group are BPC Generation Infrastructure Trust, which will also have a 47.4 percent stake, with the remainder held by the Power Workers' Union and the Society of Energy Professionals.
Cameco Corp.
Cameco withdrew from the overhaul of the Bruce A generating station because the final agreement with the Ontario government did not meet its investment criteria.
Excluding a C$63-million loss related to the transaction, Cameco said high spot prices for electricity in Ontario in the third quarter will push this year's earnings from Bruce Power "significantly higher" than the previous year.
TransCanada said its share of the project will be financed through capital contributions from 2005 to 2011.
"The Bruce Power restart and refurbishment represents a cost-competitive, long-term solution to help meet Ontario's power needs and is an attractive, long-term growth opportunity for TransCanada," chief executive Hal Kvisle said in a release.
The long-term program will restart two idled units known as as Bruce 1 and 2, and extend the life of unit 3 by replacing its steam generators and fuel channels when needed, and replace steam generators at unit 4.
TransCanada said work to restart units 1 and 2, which have been idle since the mid-1990s, will begin immediately. The first unit is expected to be on line by 2009, pending regulatory approvals.
The two units should add about 1,500 megawatts of power to the provincial system, which has struggled to keep up with demand in recent years, forcing Ontario to buy electricity from neighboring provinces and U.S. states.
Bruce Power said the two restarted units will be the source of about 25 percent of Ontario's electricity on a typical day.
TransCanada said it is not pursuing any nuclear opportunities in the United States but acknowledged it is open-minded to options that may arise.
"We do see the potential for a significant nuclear rebirth in North America," Kvisle told a conference call.
"There are a number of initiatives in the U.S. and it would be my prediction that we will see more nuclear power projects coming forward in the U.S. over the next few years."
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