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2011 Energy Summit - OCI Presentation by David Marinacci


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2011 Energy Summit - OCI Presentation by David Marinacci

  1. 1. Nuclear Supply Chain<br />Clarington Energy Summit 2011<br />D.W. Marinacci, General Manager May, 30th, 2011<br />
  2. 2. Promoting a Healthy Nuclear Industry<br />Agenda<br /><ul><li>Organization of CANDU Industries
  3. 3. Customers
  4. 4. Canadian Nuclear Industry
  5. 5. Economic Benefits of Nuclear
  6. 6. Global Nuclear Potential
  7. 7. Status of US Reactor Market
  8. 8. Decommissioning & Waste Management
  9. 9. Overview / Conclusions</li></li></ul><li>Organization of CANDU Industries <br />Promoting a Healthy Nuclear Industry<br />The Organization of CANDU Industries is an industry association representing the interests of the suppliers of goods and services to the Canadian nuclear industry. <br />OCI represents 160 + companies spanning Canada’s major engineering firms such as AMEC, Hatch and SNC Lavalin, and constructors and large scale fabricators such as AECON, Babcock & Wilcox, Black and MacDonald, Comstock and E.S.Fox … to the many small and medium equipment providers, logistics operators and even nut and bolt manufacturers that make up the Canadian nuclear industry. <br />We collectively employee over 30,000 people. <br />
  10. 10.
  11. 11. OCI Background <br />Promoting a Healthy Nuclear Industry<br />Incorporated in 1979 by several privately owned Canadian manufacturers and engineering consultants to promote companies in the Canadian private sector engaged in the supply of goods and services for CANDU and LWR nuclear power plants in both domestic and export markets. <br />The Canadian supply chain has been critical to the success of Canada’s vast nuclear build program. <br />Canada has built - for the domestic and export markets <br />36 power reactors <br />16 research reactors<br />2 prototype / demonstration reactors<br />6 heavy water plants<br />
  12. 12. Evolution of OCI<br />Promoting a Healthy Nuclear Industry<br />Over the years the number of member companies has increased and along with it markets and customers. <br />OCI companies now supply products and services in support of nuclear research, isotope production, nuclear medicine, uranium mining in addition to power reactors.<br />For over 60 years OCI and its predecessor companies have supported Canada’s pioneering nuclear research programs and operations at AECL sites and Universities across the country. <br />OCI supplies goods and services to the Canadian Uranium industry that mines processes and manufactures nuclear fuel and is one of the largest in the world. <br />OCI companies support and supply goods and services to the Canadian nuclear medical industry the largest supplier of medical isotopes in the world.<br />
  13. 13. Customers <br />Promoting a Healthy Nuclear Industry<br />Domestic Utilities<br />Ontario Power Generation <br />Bruce Power <br />Hydro Quebec <br />New Brunswick Power <br />International Utilities<br />Romania<br />Korea<br />China<br />Argentina<br />India - future<br />Universities <br />McMaster University - Pool type reactor <br />EcolePolytechnique - Slowpoke – 2 research reactor <br />Dalhousie University - Slowpoke – 2 research reactor<br />Saskatchewan Research Council - Slowpoke – 2 research reactor<br />University of Alberta - Slowpoke – 2 research reactor <br />Royal Military College of Canada - Slowpoke – 2 research reactor<br />
  14. 14. Customers continued<br />Promoting a Healthy Nuclear Industry<br />Nuclear Waste Management Operations (NWMO) <br />Deep Geological Repository for Low & Intermediate Level Waste<br />Deep Geological Repository for Nuclear Spent Fuel<br />Hospitals - nuclear equipment, Isotopes, medicine & waste handling <br />COG - CANDU Owners Group<br />Many OCI member Companies are also OCI customers <br />Cameco - Uranium mining & fuel manufacture<br />General Electric – Hitachi – fuel manufacturer, fuel machines, equipment<br />Babcock – Steam generators, equipment <br />Large Engineering & Construction firms like SNC Lavalin, AMEC, CH2MHill, Aecon, Comstock etc. <br />Tier 2 & 3 Suppliers for major projects <br />
  15. 15. Canadian Nuclear Industry<br />Promoting a Healthy Nuclear Industry<br />Nuclear Industry – from theCNA<br />The Nuclear Industry is currently a $6.6 billion/year industry <br />$1.5 billion in federal & provincial revenues are generated through taxes<br />The industry employs over 71,000 people<br />21,000 direct jobs<br />10,000 indirect jobs<br />40,000 spin-off jobs<br />Over 160 companies export over $1.2 billion of goods<br />
  16. 16. Local Economic Benefits of Nuclear<br />Promoting a Healthy Nuclear Industry<br />The nuclear industry in Durham already employs thousands of people and generates billions of dollars of economic activity.<br />Ontario’s plans to refurbish 10 CANDU reactors and build two new plants (4 in Durham) will act as a catalyst to rejuvenate the nuclear industry, creating thousands of new high-paying jobs, both locally and across Ontario. <br />These investments will provide the momentum for exports that will contribute billions of dollars of economic activity to the region and to the Canadian economy.<br />
  17. 17. Economic Benefits of Nuclear<br />Promoting a Healthy Nuclear Industry<br /> Regional economic benefits accrue to the community over the complete reactor life cycle, from research to decommissioning, as well as from exporting products & services in support of the global nuclear renaissance.<br />
  18. 18. Economic Benefits of Nuclear<br />Promoting a Healthy Nuclear Industry<br />Operations<br /><ul><li>Extrapolating from the CME’s study “Annual Economic Impact of operating reactors in Ontario” the annual economic impact of operating OPG’s 10 reactors in the Durham Region would be ~ $1.59 billion / year.</li></ul>Refurbishment Projects<br /><ul><li>Extrapolating from the CME’s study “Annual Economic Impact of Refurbishments in Ontario” the annual economic impact of refurbishing 4 reactors in the Durham Region would be ~ $1.0 billion / year over 11 yrs.</li></ul>Darlington New Build Project<br /><ul><li>The Conference Board of Canada’s report, entitled “Economic Impact of New Nuclear Investments in Canada”, identified a capital investment in Canada of $7.4 billion dollars and employment of 64, 277 person years (considering direct and indirect employment)</li></li></ul><li>Global Nuclear Potential<br />Promoting a Healthy Nuclear Industry<br />Power reactor Market<br /><ul><li>There are currently ~ 440 nuclear power reactors operating in 30 countries, with a combined capacity of over 376 GWe providing ~ 15% of the world's electricity.
  19. 19. Approximately 155 reactors are planned to be built internationally with over 60 power reactors currently under constructed in 15 countries.
  20. 20. Most reactors on order or planned are in the Asian region, though there are major plans for new units in Canada, Europe, the US and Russia
  21. 21. Significant further capacity is being created by plant upgrading in Canada and in the US through refurbishment and life extension programs. </li></li></ul><li>Global Nuclear Potential<br />Promoting a Healthy Nuclear Industry<br />World Nuclear Association Outlook<br />
  22. 22. Status of US Reactor Market <br />Promoting a Healthy Nuclear Industry<br />Design Certification (DC) <br /><ul><li>Two designs are certified;
  23. 23. GE ABWR; Westinghouse AP1000</li></ul>Early Site Permit (ESP) <br /><ul><li>Four issued by NRC
  24. 24. Two applications under NRC review </li></ul> <br />New Nuclear Plant Orders <br /><ul><li>Four Engineering, Procurement, & Construction Contracts signed
  25. 25. TVA resumed construction of Watts Bar 2 & reconsidering Bellefonte 1 & 2</li></ul>Combined Construction and Operating License (COL)<br /><ul><li>18 COL applications submitted, 12 remain under active NRC review</li></li></ul><li>Status of US Reactor Market <br />Promoting a Healthy Nuclear Industry<br />Components & Manufacturing<br /><ul><li>Nine utilities ordered large, long-lead forgings from three vendors AREVA, Toshiba & Westinghouse
  26. 26. Westinghouse ordered reactor coolant pumps & containment liner plates
  27. 27. Progress, SCE & G & Southern contracted Westinghouse for long-lead forgings
  28. 28. Entergy & Exelon contracted GE-Hitachi for long-lead forgings
  29. 29. Ameren UE & UniStar contracted AREVA for long-lead forgings
  30. 30. NRG Energy signed an agreement with Toshiba for long-lead forgings</li></ul> <br />Supply Chain<br /><ul><li>Areva & Northrop Grumman are building a 300,000-square-fort facility in Virginia, to manufacture heavy components for the EPR – to open in 2013
  31. 31. Shaw & Westinghouse built a 410,000-square-foot facility in Louisiana, to produce structural, piping, equipment, & other modules for the AP1000
  32. 32. Internationally: Japan Steel Works is expanding capacity; AREVA, Doosan, BWXT, & Russia’s (OMZ) are developing large forging capabilities </li></li></ul><li>Decommissioning & Waste Management<br />Promoting a Healthy Nuclear Industry<br /><ul><li>Over 400 civil nuclear reactors worldwide will need to be decommissioned over the next several decades
  33. 33. The global market is est. to be $485 Billion US over the next 30 years
  34. 34. Decommissioning and cleanup of the global civil nuclear legacy represents a massive management, technological and environmental challenge for the international community over the next century</li></ul>* Global Decommissioning Opportunities Report (Commissioned by the UK Department of Trade and Industry, UK Trade and Investment and Scottish Development International)<br />
  35. 35. Decommissioning & Waste Management<br />Promoting a Healthy Nuclear Industry<br />Regional Activities<br /><ul><li>Pickering units #2 & #3 are in layup status to be decommissioned in the future.
  36. 36. Pickering Waste Management Facility (PWMF) provides dry fuel storage for Pickering.
  37. 37. Darlington Waste Management Facility (DWMF) provides dry fuel storage for Darlington.
  38. 38. Port Granby in Clarington, under the Port Hope Area Initiative, is developing and implementing a safe, local, long-term management solution for the historic Low Level Radioactive Waste.</li></ul>Opportunities for Regional Business Development<br /><ul><li>There are many opportunities for local companies to participate in these projects, develop products and services and market their capabilities.
  39. 39. Canada nuclear liability legacy is estimated at $2.7 billion, and the government is investing over $100 million / year to address it.
  40. 40. Deep Geological Repository for used fuel. Funded by reactor operators the Nuclear Waste Management Operations (NWMO) is charged with establishing safe long-term storage facilities for used fuel. The estimated cost for the facility is $5.4 billion (present value) for 2.2 million bundles.
  41. 41. Deep Geological Repository (DGR) for low and intermediate level waste. The NWMO is seeking regulatory approval, on behalf of Ontario Power Generation, for the construction the DGR.
  42. 42. The Department of Industry and Trade in the UK estimates the global decommissioning and waste management market to be ~ $485 billion (US)</li></li></ul><li>Overview / Conclusion<br />Promoting a Healthy Nuclear Industry<br /><ul><li>The Canadian nuclear supply chain has extensive experience supplying products and services to the domestic and international CANDU markets
  43. 43. With the Darlington project and refurbishment of ten CANDU’s committed there are enormous opportunities for the supply chain in Canada
  44. 44. With 155 reactors planned and > 60 under construction there are significant opportunities for the Canadian supply chain in international markets
  45. 45. The Canadian supply chain is in a good position to pursue the US reactor market; which is set to grow rapidly in the next few years
  46. 46. With an est. $485 Billion global decommissioning & waste management market developing there are opportunities for more suppliers in this sector
  47. 47. For suppliers to be successful they must carefully evaluate their products & services against global opportunities, reactor technologies and vendor quality requirements and develop a “value proposition”</li></li></ul><li>