BNFL sparks row by seeking US partners for clean-up

BNFL has enraged the Government by favouring two of America's largest companies, rather than domestic partners, for lucrative work cleaning up Britain's nuclear sites.

Fluor, the engineering group, and Jacobs, a specialist technical consultancy, have been pinpointed by BNFL as its desired partners to carry out the work.

The decision has disappointed UK companies which had submitted bids to BNFL in the past few months. The Department of Trade and Industry has also made it clear to Britain's publicly owned nuclear company that it is not impressed with its decision to freeze out domestic rivals.

Tensions are running high over the issue as BNFL, soon to be renamed British Nuclear Group, is in line to be officially awarded the main contract, lasting until 2008, to decommission nuclear sites across the country. The largest of these is Sellafield in Cumbria.

This contract will be awarded by the Nuclear Decommissioning Agency (NDA), a new body which will oversee the clean-up of all Britain's nuclear reactor sites.

A source close to the situation said that BNFL would find it difficult to persuade the NDA to accept its choice of partners given the political sensitivities of the situation.

The source added that this could delay the signing of the whole contract.

"The NDA is the customer here. It is for the NDA to accept it," the source said.

BNFL said no final decision had been made. A spokesperson also emphasised that it was not outsourcing the management of any of the sites, but rather looking for entities which would carry out limited "tier-two consultancy work". Spokespeople for Fluor and Jacobs would not comment.

Those close to the situation believe the companies chosen for the initial contracts will receive a valuable foot-in-the-door to one of Britain's largest government-funded projects, which could be expanded to include further responsibilities.

BNFL's choice of Fluor and Jacobs will also be a significant setback for Bechtel, the politically well-connected American engineering group which had been planning to bid for some of the work in two or three years' time. It is unable to do so until that point because it has been hired to give advice to the Government over the setting up of the NDA.