Concerns about possible construction cost hikes at two U.S. nuclear expansion projects escalated after parent company Toshiba Corp. revealed that Westinghouse determined the cost to complete them “will far surpass the original estimates.” The resulting corporate writedowns—cited in reports of Toshiba Chairman Shigenori Shiga’s planned resignation—are expected to be detailed during a Feb. 14 Toshiba earnings call, a Westinghouse spokesperson said.
Noting “increases in key project parameters,” Toshiba reported that the amount of goodwill associated with Westinghouse’s acquisition of Chicago Bridge & Iron/Stone & Webster’s U.S. Plant Vogtle and V.C. Summer contracts would rise to “several billion U.S. dollars” from the original $87-million estimate. The financial revisions result from Westinghouse’s assessment of the value of assets and liabilities acquired from the December 2015 deal.
The Georgia Power-led team of utilities serving as the Vogtle project owner possesses $920 million in letters of credit, says spokesman Jacob Hawkins. Officials with SCANA, the owner of the V.C. Summer project, “are in regular contact with Westinghouse and Toshiba and will continue to monitor activities very closely,” said spokeswoman Rhonda O’Banion.
“While we cannot speculate on what may happen in the future with Toshiba or Westinghouse and [its] overall business, we will always hold them, as the contractor, accountable for their responsibilities under our agreement,” Hawkins added.