Toshiba corporation hugely burdened by its overseas nuclear business projects
Overseas nuclear business a huge burden on Toshiba , Japan News, February 22, 2017, By Miho Yokoi / Yomiuri Shimbun Staff Writer Toshiba Corp. has been facing a need to review its nuclear business because it has been a drag on the company’s reconstruction efforts, mostly caused by the huge loss booked in reactor building projects in the United States and construction delays in other countries.
Nonetheless, it will not be easy for the major electronics and machinery maker to considerably shrink its nuclear business overseas because there are only a handful of entities that can build such facilities.
Toshiba will likely book a loss of more than ¥700 billion for the April-December 2016 period, and U.S. subsidiary Westinghouse Electric Co. is a major factor behind the result…….
It is likely that Toshiba will face a ballooning loss if construction for the reactors [Plant Vogtle in Georgia, USA) continues to be delayed. “It would be a lie if we say there’s no risk at all,” said Corporate Vice President Mamoru Hatazawa.
Toshiba won contracts for building two reactors in Texas in 2009, but their construction has not yet started. The projects have been affected by the increase in the amount of U.S. shale gas production, which has caused fuel prices for thermal power generation to nosedive, thereby boosting needs for a method with cheaper running costs.
Meanwhile, Toshiba’s nuclear businesses in countries other than the United States have also been facing an uphill battle.
In China, for example, Westinghouse has undertaken construction of four nuclear reactors, originally with an aim to put them into operation between 2013 and 2015. However, none of them has been completed because of delays in the work.
The U.S. subsidiary also hoped to win contracts for developing six reactors in India, but the plan has been stalled because it is so risky for a builder to sign a contract under the current Indian law, which obliges the entity to assume liability for compensation in the event of a nuclear accident……..http://the-japan-news.com/news/article/0003536775
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