Osborne to sign nuclear plant deal with China: FT

LONDON Sat Oct 12, 2013 10:17am BST

Britain's Chancellor of the Exchequer George Osborne arrives to listen to Prime Minister David Cameron's keynote speech to the Conservative Party annual conference in Manchester, northern England October 2, 2013. REUTERS/Toby Melville

Britain's Chancellor of the Exchequer George Osborne arrives to listen to Prime Minister David Cameron's keynote speech to the Conservative Party annual conference in Manchester, northern England October 2, 2013.

Credit: Reuters/Toby Melville

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LONDON (Reuters) - British Chancellor George Osborne will sign a deal in China next week allowing a Chinese state-run nuclear power company to help build a new plant in Britain, the Financial Times reported on Saturday.

The paper, citing unnamed sources familiar with the matter, said Osborne would sign a memorandum of understanding to back the Chinese General Nuclear Power Group (CGNPG) entering a deal with France's EDF for a planned new nuclear plant at Hinkley Point in southwest England.

The deal would also see Britain back plans for CGNPG to build and help operate a reactor in Britain, while also giving its support to Chinese nuclear technology receiving approval from British regulators, according to the report.

The agreement would also involve CGNPG's rival state-run nuclear company, China National Nuclear Corp, sources told the paper.

However, the FT said allowing Chinese firms to play such a prominent role in Britain's nuclear programme would raise security and safety concerns.

On Thursday, EDF and the British government said talks over financial terms for the new plant at Hinkley, which would be Britain's first new nuclear plant for decades, were continuing.

The two parties have been negotiating for more than a year about fixing a minimum electricity price for power generated at the proposed plant as part of a new energy policy package that aims to reward forms of energy with low carbon emissions.

"A contract will only be offered if it's value for money, fair and affordable, in line with government policy on no public subsidy for new nuclear and consistent with state aid rules," a spokesman for the Department for Energy and Climate Change said.

The FT said talks were slowly nearing an agreement, based on a price of 90-92 pounds ($140-$150) per megawattt hour. ($1 = 0.6271 British pounds)

(Reporting by Michael Holden; Editing by Robert Birsel)

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