Exelon's Oyster Creek nuclear plant to be bought, decommissioned by JV

Washington — Exelon Generation's Oyster Creek nuclear power plant in Forked River, New Jersey, will be bought and decommissioned within eight years by a joint venture of Holtec International and SNC-Lavalin, decades sooner than previously planned, Exelon and Holtec International said Tuesday.

The 670-MW boiling water reactor began commercial operation in December 1969 and is one of the oldest nuclear units still in operation in the US. Under an agreement with the state of New Jersey, Exelon was to shut Oyster Creek by December 2019, allowing the company to avoid installing expensive cooling towers.

However, Exelon announced earlier this year that it would permanently shut the plant September 17.

Exelon and Holtec International, in a joint statement Tuesday, said "Holtec will assume ownership of the site, real property and used nuclear fuel. As the site's owner, Holtec will manage all site decommissioning and restoration activities."

They said that "the transaction is expected to close in the third quarter of 2019, pending the [US] Nuclear Regulatory Commission's and other regulatory approval, and will not impact the scheduled shutdown of Oyster Creek."

Bryan Hanson, chief nuclear officer of Exelon Generation, said in the statement that "Holtec's commitment to the nuclear industry and its presence in New Jersey will allow many of our employees previously facing relocation to continue living and working in the Garden State. Further, with three decades of experience in nuclear fuel technologies and a partnership with global decommissioning leader SNC-Lavalin, Holtec is ideally positioned to complete the decommissioning of Oyster Creek safely and swiftly."

Under NRC regulations, the agency reviews decommissioning plans for nuclear power plants. NRC would also need to review and approve a request to transfer Oyster Creek's operating license to the joint venture, which known as Comprehensive Decommissioning International.

Under a previous decommissioning plan submitted to NRC in May, Exelon said it planned to delay the start of most decommissioning activities at Oyster Creek until December 2073, placing the plant until then in a dormant state known as Safstor. Under that previous plan, decommissioning activities were scheduled to be completed in December 2077, with site restoration activities continuing until April 2080.

However, CDI and SNC-Lavalin said in a statement Tuesday that CDI plans to begin decommissioning the plant in 2019, "pending transaction closure."

The companies said, "With its experience and state-of-the-art technologies, CDI is well equipped to decommission Oyster Creek within eight years, more than 50 years ahead of the industry-allowed 60-year timeline." That 60-year time limit for decommissioning a nuclear plant after it surrenders its operating license following permanent shutdown is also required by NRC regulations.

The exact value of the transaction was not disclosed, but CDI and SNC-Lavalin said it is "worth hundreds of millions of dollars."

In its previous decommissioning plan submitted to NRC in May, Exelon estimated that "radiological decommissioning" of Oyster Creek under the proposed Safstor option would cost about $1.1 billion. Spent fuel management was estimated to cost an additional $290.1 million, and site restoration was expected to cost about $60.2 million, it said.

Since July 1, Oyster Creek has reduced its output as part of a "coastdown" to its closure, and the unit was operating at 70% of capacity Tuesday morning, plant spokeswoman Suzanne D'Ambrosio said in an email. Output was reduced further in recent days to perform maintenance on the plant's feedwater system, D'Ambrosio said.

"As the company determines its next steps, our Resident Inspectors will continue to monitor whether the problem [of feedwater heater tube leakage of water] is adversely impacting operations and follow any troubleshooting and repair plans," NRC spokesman Neil Sheehan said in an email Monday.

"We have no immediate safety concerns," Sheehan said. --Steven Dolley, steven.dolley@spglobal.com

--Edited by Richard Rubin, richard.rubin@spglobal.com