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Government goes fishing - AECL is the bait


Thursday's announcement the federal government is seeking companies interested in investing in, working with, or managing Atomic Energy Canada Limited's labs is being seen as another sign Ottawa wants to cut itself free from the company.

This Request for Expression of Interest, announced by Natural Resources Minister Joe Oliver, was to find out if anyone in the private sector was interested in any aspect of the Crown corporation, as it is about to enter another phase of restructuring.

"This process will allow the government to benefit from the experiences of organizations, domestic or international, involved in the management or restructuring of nuclear science and technology or radioactive waste management," read a statement posted on the National Resources' website.

"The information gathered through this process will help inform the restructuring process, a critical step to further strengthen Canada's nuclear industry while reducing taxpayers' exposure to financial risks in this sector."

Gordon Tapp, president of the Chalk River Technicians and Technologists, said this is a fishing expedition, and a possible prelude to the privatization of AECL and Chalk River labs.

"They (the government) are trying to see who is interested and the range of the interest" in the company, he said. "They are trying to look at all the options available to them."

The goal is to not necessarily sell AECL outright, but to eventually have the private sector take over running the operation.

"The federal government doesn't want to be in that business, and haven't been overly supportive of R and D in general," Mr. Tapp said. "They would like to see someone else come in and invest in it."

He said what is driving this is the government's determination to shed costs anyway they can, due to the worsening economy and government deficit, coupled with the philosophy there are a lot of things the private sector should be doing that the Crown is doing using tax dollars.

What he is concerned about is if there is insufficient interest shown from the industry for what AECL has to offer, there have been indications the government may scale back or even shut down the active parts of the site.

"We could see Chalk River reduced to just a waste management and decommissioning site," Mr. Tapp said, as it decommissions facilities and deals with a wide variety of buried and stored radioactive waste left on site.

AECL has been having a rough go of it over the years, facing criticism for the millions of dollars spent on the company, an investment with its critics claim has little to show for it.

The cancelation of the MAPLE 1 and 2 reactor project, the extended shutdown of the 55 year old National Research Universal reactor due to heavy water leakage and the bumpy ride of the next generation of CANDUs, the ACR 1000, which has stalled due to a lack of sales and high costs, together hurt the company at the worst possible time.

This has led to the ongoing restructure of the Crown corporation. In 2009, the federal government announced the commercial side of AECL, including its flagship CANDU division, was to be sold off. That process was completed last year after Montreal-based SNC-Lavalin purchased it for $15 million, while the Canadian government retains intellectual property rights for the CANDU reactors.

Now that the dust has settled, it is the remainder of AECL's turn to be restructured, starting with this Request for Expression of Interest.

On a website which advertises government contracts, it is stated how the restructuring is considering how to reduce federal contributions to AECL, "notably through enhanced cost-recovery for all services AECL provides to third parties, and/or through partnership or management opportunities as identified through this or other processes."

"The restructuring needs to determine the activities of interest to those stakeholders willing to invest in AECL, which would enable enhanced sharing of both benefits and risks while strengthening accountability."

Mr. Tapp said this hints at a "use it or lose it" strategy, in which the government is saying if those in the nuclear industry want AECL research and expertise to continue, they should step up and be prepared to fund it themselves. He said there is also a challenge being issued to the provinces, such as Ontario, to make up their minds if they want nuclear power as part of their electricity grid, and to do it quickly.

"They are saying to Ontario and the industry, if you want research in CANDU to continue, you got to pay for it."

Still, it isn't all gloom. While Mr. Tapp said the level of tension has gone up among the staff following the Minister's announcement, they were also reminded the company has a lot to offer perspective investors.

"People on the outside (of government) are being asked to step up and take this on," he said.

"We've got a lot here that's of value," he said, "so we need to let folks know about it."

Interested parties are being given until April 2 to make their intentions and interests in AECL known.

Stephen Uhler is a Daily Observer multimedia journalist