Toshiba's nuclear unit Westinghouse files for bankruptcy protection
A Toshiba-owned firm, that is a leading player in the proposed Moorside nuclear plant, moves to protect itself from creditors.
Wednesday 29 March 2017 13:30, UK
Toshiba's Westinghouse Electric (WE) division, which is set to power a planned nuclear plant in Cumbria, has filed for bankruptcy protection from creditors.
The Japanese group, part of the joint venture behind the Moorside power station project, admitted the financial crisis at WE left the supply of its technology "uncertain" though Toshiba itself remained committed currently.
The doubts are a result of a crisis at the group, which faces a growing bill from a business in WE that is beset by project delays, cost over-runs and allegations of accounting fraud.
The struggles at WE were largely borne out of the world shying away from nuclear energy in the aftermath of the Fukushima nuclear disaster in 2011, caused by the Pacific earthquake and tsunami.
Toshiba, on Wednesday, put WE liabilities at almost $10bn (£8bn) as of December - saying that it expected its net loss for the current financial year to the end of March could top 1tn yen (£7.2bn).
"Since December 2016, WE and Toshiba have been working to determine the scale of the possible loss, investigate the causes and to implement preventive measures and actions," the company said.
Toshiba has been granted two extensions to allow it to publish group quarterly results that were originally due in February and it could be delisted from the Japanese stock market unless it meets an 11 April deadline.
The troubles at WE sparked renewed calls in the UK for Government assurances over Moorside - with Labour demanding the ministers under-write Toshiba's investment to safeguard the project and its potential for 20,000 new jobs.
The joint venture for the Sellafield plant told Sky News it remained "business as usual".
"NuGen is continuing to develop its Moorside Project to deliver three Westinghouse AP1000 reactors in West Cumbria.
NuGen will continue to work alongside our technology supplier, Westinghouse, and our shareholders, Toshiba and Engie, in taking forward the Moorside development phase."
Toshiba was more cautious in its response.
It said: "The Chapter 11 filings have made planned supply of the AP1000 (nuclear power plant) for the UK project uncertain, and we have therefore recorded an impairment loss covering the cost of the NuGen project."
It added: "Toshiba is committed to invest until the FID (final investment decision), but there is a certain point before the FID where we can review and determine whether or not to continue the project."
A Department for Business, Energy & Industrial Strategy spokesperson said: "The UK Government is committed to new nuclear as an important part of our energy mix, having commissioned the first new nuclear power station in a generation at Hinkley Point C.
"The UK is one of the most attractive countries to invest in new nuclear and we engage regularly with the developers of proposed new nuclear projects."