Areva, EDF in bitter dispute over uranium

FRANCE - The French nuclear industry is in turmoil as uranium supplies have dried up and the treatment of spent fuel has been blocked amid an increasingly bitter row between the heads of its two main state operators.

EDF, the electricity group that runs 58 reactors in France, said that Areva, the nuclear energy group, had stopped uranium deliveries on January 4 and was refusing to take away spent fuel for reprocessing.

''The transport of combustibles isn't working at the moment,'' Anne Lauvergeon, the chairwoman of Areva, said.

As a result, used fuel is remaining at EDF sites instead of being reprocessed at La Hague treatment plant in northern France.

Mrs Lauvergeon blamed a breakdown in talks over a new €800 million contract with EDF to process spent fuel.

''We've been talking for too long,' she said, calling on President Sarkozy's Government to resolve the dispute.

Although Areva supplies 68 per cent of the uranium used in EDF's reactors, which themselves produce 77 per cent of electricity in France, the electricity group said it had enough stocks to last several months without envisaging power cuts.

A spokesman said that it could keep spent fuel at its plants without risk of a radioactive leak.

But the dispute is certain to damage the reputation of the two nuclear operators, which are both among the world's biggest.

As insults flew between the two state-owned groups, which are both significant players in Britain's energy sector, Areva denied that it had stopped uranium supplies but confirmed EDF's claims about the block on treating spent fuel.

The dispute comes amid tense relations between Mrs Lauvergeon and Henri Proglio, who followed his appointment as chairman of EDF in November with a call for a shake-up of the French nuclear sector.

Their squabble has been cited as one of the factors behind France's failure to secure a €30 billion contract to build reactors in Abu Dhabi.

The contract went to a South Korean consortium led by Korea Electric Power, and Mrs Lauvergeon implicitly blamed EDF for failing to back her in the negotiations.

''I fully assume my responsibilities and those of Areva, but I don't intend to assume other people's,'' she said.

She added: ''South Korea was ready to do anything to win, in terms of price and in state financing.''