AMEC

This article is part of the Nuclear Spin project of Spinwatch.

AMEC is one of Britain's leading engineering project management and consultancy companies, listed on the London Stock Exchange and the FTSE 100. It operates in some 700 locations and 40 countries across the globe.

Background

AMEC employed over 27,000 people in over 40 countries in 2012. In 2011, 70 per cent of AMEC's turnover was generated outside of the UK. Nuclear work was only eight per cent of its turnover. A similar percentage comes from renewables and bioprocessing, which includes biofuels and biomass.

AMEC has worked in the nuclear sector since the birth of the industry almost 60 years ago and today employs over 3000 specialists in this field. It says it is "the largest UK private sector supplier of programme management and engineering services and programme and asset management to the nuclear industry”.

Clients as of 2012 include Sellafield Ltd, OPG, Bruce Power, AWE Aldermaston, Rolls Royce, BAE, and EDF Energy which now incorporates British Energy. Past clients include the British Nuclear Group and UKAEA and a wide range of international nuclear operators'.

In June 2012 AMEC bought Serco Group plc’s nuclear Technical Services Group (TSG) business for £137 million. TS is based at a number of sites in the UK and has around 600 staff providing consulting and project solutions for customers including the Ministry of Defence, EDF, Magnox Ltd and the Nuclear Decommissioning Authority. Serco notes that Serco itself will continue to serve the defence and science sectors, notably AWE and the National Nuclear and National Physical laboratories.

AMEC's nuclear partnerships

Nuclear Management Partners

Amec is part of Nuclear Management Partners (NMP), a consortium with American company URS, and French company Areva, which runs Sellafield Ltd, managing and operating the Sellafield site in West Cumbria, Capenhurst in Cheshire and the engineering design capability based at Risley in Warrington on behalf of the Nuclear Decommissioning Authority (NDA).

The Sellafield nuclear site was previously owned and operated by British Nuclear Fuels Ltd, but all its nuclear sites were transferred to the NDA in 2005, and BNFL was abolished in 2010. The NDA is a non-departmental public body which does not directly manage the facilities it owns, but contracts out the delivery of management and decommissioning operations to private contractors. In the case of Sellafield, NMP is currently contracted to run reprocessing and nuclear waste management activities.

Richard Caborn, a former Labour trade minister was appointed a non-executive director of Nuclear Management Partners in 2007.

In 2013 Sellafield's owner, the Nuclear Decommissioning Authority (NDA), expressed disappointment at NMP'’s running of the site and in August 2013 was reportedly deciding whether to renew NMP's contract, to re-tender it, or to take over the management itself.

Amec, although admitting NMP's failings, claimed to have delivered “good value” in managing nuclear waste clean-up operations at Sellafield and remained “optimistic” of retaining the £22bn contract.

Its optimism proved well-founded - in early October 2013 the NDA announced that it would renew the contract, despite the fierce public criticism. The NDA said it wanted to give NMP further time to make "significant improvements". According to the NDA's chief executive officer John Clarke,

Sellafield is by far the most complex and challenging site in our portfolio, and we are determined to drive improved performance.

The right decision is to extend the contract to give NMP further time to bring about the improvements in capability and performance at the site that we and they are looking for. We have had extensive discussions with NMP and made clear where these improvements must be made.

Caithness Solutions

Dounreay, in Caithness, the site of the UK’s research into fast breeder reactors, was originally run by the UK Atomic Energy Authority (UKAEA). In 2005 the NDA took ownership and responsibility for the liabilities at Dounreay. UKAEA became a contractor to the NDA carrying out decommissioning work at Dounreay.

The UKAEA set up the Pentland Alliance with AMEC and CH2MHill in 2006, to explore joint opportunities in the nuclear decommissioning market. Babcock International bought UKAEA Ltd for £38 million in September 2009. AMEC then left the group which was re-named Babcock Dounreay Partnership, and URS replaced it.

AMEC Nuclear Holdings Ltd (NNL) and Energy Solutions EU Ltd made up Caithness Solutions which was one of two preferred bidders chosen by the NDA to run Dounreay in 2010. However in April 2012 Babcock Dounreay Partnership, comprising Babcock Nuclear Services Ltd, CH2M Hill International Nuclear Services Ltd, and URS International Holdings (UK) Ltd, were awarded the contract.

Nuclear new build

In 2011 AMEC won an 11-year consultancy contract for EDF Energy’s nuclear new build projects in the UK. It will support their 'architect engineering' operation for the proposed delivery of four new EPR nuclear reactors at Hinkley Point and Sizewell.

AMEC has worked on the build of every civil nuclear power station dating back to the 1950s in the UK and also works globally, supporting nuclear operators on life extension, operational improvement and new reactor build programmes. In Canada, it is a partner in a team undertaking a multi-billion dollar project to restart the Bruce Reactors in Ontario.

Nuclear lobbying

Tetra Strategy has provided public affairs consultancy services to AMEC since August 2007, when it won the account previously handled by Good Relations. Tetra told PR Week it would "lobby ministers and officials to ensure that AMEC’s name is in the frame when major public infrastructure projects are discussed" and would lobby on nuclear power as AMEC is a major player in the new build of nuclear power stations in the UK. Tetra's people include disgraced former Tory MP Julie Kirkbride and former Tory MP Sir Richard Needham.

On 23 March 2005 AMEC helped launch the push for a nuclear renaissance in the run up to the May 2005 General Election by inviting some of Britain's most senior business journalists for breakfast at the St Stephen's Club in Westminster. Speakers at the event included David King, the government chief scientist, Brian Wilson, the former energy minister, and Dipesh Shah, chief executive of the United Kingdom Atomic Energy Authority, who made a pitch for nuclear energy in order "to stop the lights going out".

A conflict of interest on waste and new build?

Also see CoRWM pages on AMEC's role on the supposedly independent committee. Before publication of its July 2006 report, which recommended deep geological disposal for nuclear waste, AMEC NNC had been acting as CoRWM’s programme manager, as well as managing the discussion at its plenary meetings, organising its public consultation and procurements procedures as well as its PR company, Luther Pendragon. In fact Luther Pendragon was not contracted to CoRWM at all, but to AMEC NNC.

So here was a nuclear company heavily involved in lobbying for a nuclear renaissance in the run up to the 2005 General Election, also acting as consultants to the committee which was deciding what to do with nuclear waste - one of the last roadblocks in the way of new build.

Nuclear affiliations

• Nuclear Research and Development Advisory Board - Professor Nawal Prinja, Technical Director of AMEC Nuclear, sits on this ad-hoc group made up of civil servants and industry people, set up in 2012
• Law firm Pinsent Masons advised on AMEC's purchasae of Serco's nuclear services group

Other issues

UK fracking study

AMEC is carrying out a research project entitled: 'Understanding the potential impacts of shale gas fracking on the UK water industry'. Commissioned by UK Water Industry Research (UKWIR), this will run from December 2012 until March 2014. The purpose is 'to better understand the potential risks and opportunities to the UK water industry posed by future shale gas extraction'.

AMEC says it is:

ideally placed to undertake this research having been delivering full scale unconventional gas extraction projects, including some for shale gas, for a number of years in North America, Australia, Asia and South Africa. AMEC has very strong links to the UK water industry and has already developed a leading position in providing advice to UK regulators on impacts from shale gas, and are currently working with the European Commission to assess the need for a risk management framework for policies around unconventional gas extraction.

The company expect that:

As a result of this work, the industry will be able to enter into discussions and negotiations with regulators, government and shale gas operators from an informed position. The work will enable the industry to respond consistently and sensibly to planning inquiries. The water industry will also gain an understanding of potential opportunities in terms of water supply and waste water treatment and will be able to plan accordingly.

Dams and pipelines

In 2003, when AMEC announced that it had 99.96% approval for the takeover of the French firm SPIE Batignolles, eyebrows were raised. At the time, SPIE was in the middle of a court case involving bribery allegations in the construction of a controversial dam as part of the Lesotho Highlands Water Project. High ranking officials at the project were imprisoned for taking bribes from multinationals including SPIE and Canada's Acres International.

The dam scheme in southern Africa attracted the attention of environmentalists who claimed that 27,000 people and hundreds of subsistence farming households were affected but had not been properly compensated. The project, which was intended to divert water from Lesotho to South Africa, was first conceived during the Apartheid era when South Africa was subject to international sanctions. To avoid the difficulties of international financiers openly aiding the then-apartheid regime, the project's financial advisers – Chartered WestLB – set up a London-based trust fund through which payments could be laundered.

AMEC was also involved in the construction of the Baku-Ceyhan oil pipeline. Its responsibility in the project was to build a section through a Georgian national park which is the source for Georgia's largest export, Borjomi Mineral Water.

It was also part of the consortium that built Britain's first toll motorway – the Birmingham Northern Relief Road. The consortium expects to receive more than £2bn from people using it. The road destroyed 27 miles of the West Midlands green belt and damaged two SSSIs. AMEC also has an 11 per cent interest in the Cross Israel Highway Concession.

Iraq contracts

In 2003 AMEC's chief executive at the time, Sir Peter Mason, said prior to the war on Iraq: "If there is a war, we might see more work afterwards. We were involved in Kuwait the last time." In 2004 it was awarded major reconstruction contracts in Iraq.

People

• Marc Boulter - VP Transmissions & Distribution Services]] AMEC

Website

www.amec.com