[ RadSafe ] MDS Sues AECL, Canada Over Reactor Cancellation
John R Johnson
idias at interchange.ubc.ca
Thu Jul 17 18:12:37 CDT 2008
This ex AECL'er thanks you for this update. When I was at AECL/CRL, CRL was
called CRNL and the Maple reactors were "in the future".
John R Johnson, PhD
CEO, IDIAS, Inc.
4535 West 9th Ave
Vancouver, B. C.
V6R 2E2, Canada
idias at interchange.ubc.ca
----- Original Message -----
From: "Colette Tremblay" <Colette.Tremblay at ssp.ulaval.ca>
To: <radsafe at radlab.nl>
Sent: Thursday, July 17, 2008 12:12 PM
Subject: [ RadSafe ] MDS Sues AECL, Canada Over Reactor Cancellation
MDS Sues AECL, Canada Over Reactor Cancellation
Reuters Health Information 2008. © 2008 Reuters Ltd.
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By Scott Anderson
TORONTO (Reuters) Jul 09 - MDS Inc said on Wednesday it has filed a C$1.6
billion ($1.58 billion) claim against Atomic Energy of Canada Ltd and the
Canadian government for scrapping a reactor project that would have supplied
the company with medical isotopes.
MDS, a medical services company, said its claim follows a May decision by
the government and AECL to scuttle the Maple nuclear reactor project without
giving the company prior notice or offering consultation. MDS sells medical
radioisotopes, used in cancer treatment, to hospitals and other health-care
Mississauga, Ontario-based MDS, which also specializes in analytical
instruments, molecular imaging and contract research, said it is seeking an
order to compel AECL, a government agency with responsibility for nuclear
products, to fulfill its 2006 contract to provide a 40-year supply of the
isotopes. If not, MDS said it would seek the damages.
"It was our last resort after trying as best we could with conversations to
get a resolution here that made some sense," Stephen DeFalco, MDS president
and chief executive, said in an interview.
"But we need them to honor their commitment to finish these reactors and to
provide 40 years worth of supply. It's very important for our patients and
it's very important for our business."
Maher Yaghi, an analyst at Desjardins Securities in Montreal, said the
company had to take legal action now to address long-term supply of the
"They have to do what they have to do. This is something that you can't wait
a long time before you start because you know how the court system works,
especially if you are suing the government," Yaghi said.
Natural Resources Minister Gary Lunn said the government would defend itself
and AECL against the claim.
"Neither the government nor AECL accept the allegations made in the
statement of claim, accordingly we will be taking steps to defend AECL and
the (government)," Lunn said in a statement.
In a surprise move in mid-May, AECL said it was halting work on the Maple
reactor in Eastern Ontario because of huge cost overruns and other problems.
Maple had been designed to replace an aging reactor at Chalk River in
Ontario that now supplies isotopes.
The Maple project was to be completed by the year 2000 at a planned cost to
MDS of C$145 million. By 2006, the project was still not finished and costs
had more than doubled, with MDS's investment exceeding C$350 million.
The two sides reached a new agreement in 2006 stipulating that AECL would
bring the reactors into service by October 2008 and supply 40 years of the
"AECL is a commercial entity. AECL signed a commercial contract and that
contract has certain rights and obligations as part of that and this is
something for the courts to sort out," DeFalco said.
Worldwide, there are only four commercial producers of the isotopes, with
MDS's Nordion division supplying the most. DeFalco said the company could
obtain quantities of the product through backup agreements with these
Yaghi said it's possible the company may be able to write down the costs it
incurred on the Maple project, but it would probably wait until the outcome
of the legal battle is clear before it does so.
(Additional reporting by Louise Egan in Ottawa; Editing by Peter Galloway)
Spécialiste en radioprotection
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Colette.Tremblay at ssp.ulaval.ca <mailto:Colette.Tremblay at ssp.ulaval.ca>
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