The British owner of New Brunswick small modular nuclear reactor developer Moltex Energy Canada Inc. is up for sale as part of a U.K. insolvency proceeding.
Moltex Energy Ltd., a private company based in Stratford-upon-Avon, announced last month the appointment of two insolvency practitioners from accounting firm Azets Holdings Ltd. to manage its affairs. Azets hired appraisers Hilco Valuation Services to solicit offers for its assets, which are due May 7.
It’s the latest complication for taxpayer-sponsored efforts to construct small modular reactors, or SMRs, in New Brunswick.
Moltex’s wholly owned Canadian subsidiary is one of two vendors partnered with New Brunswick Power to build reactors at Point Lepreau Nuclear Generating Station. Moltex Canada’s is known as the Stable Salt Reactor-Wasteburner (SSR-W), and it’s also developing a plant to reprocess spent nuclear fuel. The second company, ARC Clean Technology, is working on another reactor called the ARC-100.
Both were originally promised by 2030. But developing a novel nuclear reactor is a painstaking, resource-intensive process that can require hundreds of employees, billions of dollars and decades of effort. New Brunswick and the federal government backed startups with only one or two dozen employees, and they’ve struggled to raise funds privately.
Moltex’s British holding company was founded in 2014 by Ian Scott, who previously worked in the biological-sciences field including as a senior scientist at Unilever PLC. (A co-founder, John Durham, stepped down as a director in October.) According to its latest financial report, published in January, it employed two people during the year ended March 31, 2024, and lost £630,000 (about $1.1-million). For several years its reports raised uncertainty about its ability to continue as a going concern.
Britain’s administration process is similar to proceedings under Canada’s Companies’ Creditors Arrangement Act; according to the British government, it’s intended to provide “breathing space” while a rescue package or sale of assets is executed.
According to Moltex Energy Ltd.’s financial statements, its shareholders had provided its equity throughout its history; it carried no long-term debt. The company reported in 2023 that its future depended on raising external capital; it had enough cash flow to survive through December, 2025, albeit “there would need to be cuts.”
Rory O’Sullivan, chief executive officer of Moltex Energy Canada, was also a director of the parent company for much of the past several years. He said the British company’s shareholders would not approve the Canadian subsidiary’s fundraising efforts, effectively stalling them.
“The key here is we needed to get someone else in control of Moltex Energy Ltd. so that we could have a competitive sale process,” Mr. O’Sullivan said.
“And the administration process allowed us to do that. … Really, we are just excited to get new owners in place and get back to business.”
The parent company also owns MoltexFLEX Ltd., a British company developing an SMR known as the FLEX. Shaun Staff, an Azets spokesperson, declined an interview request. But in a statement, he wrote that the two subsidiaries “are not in administration and continue to operate independently.”
New Brunswick’s government attracted Moltex and ARC to establish offices in the province in 2018. The two companies have each estimated that it would cost around $500-million to develop their respective technologies.
Last month, Moltex announced it had “successfully validated” its fuel reprocessing technology through experiments on used fuel bundles from one of Canada’s Candu reactors. Mr. O’Sullivan said both the SSR-W reactor and the fuel reprocessing process have completed a “proof-of-concept” phase.
“The next stage is preliminary engineering of both, and that’s a much bigger dollar value,” he said.
As for ARC, its CEO and other employees suddenly departed last summer; ARC has published no announcements on its website since then. The ARC-100 is undergoing a prelicensing review by the Canadian Nuclear Safety Commission. Spokesperson Sandra Donnelly said the company will complete its design by 2027 to support an application for a construction licence.
NB Power’s CEO, Lori Clark, presented SMRs as playing a crucial role in her utility’s plans to achieve “net zero” emissions. More recently, however, she acknowledged that neither project is likely to follow its original schedule, and the utility is now considering other reactors for construction at Point Lepreau.
Spokesperson Dominique Couture wrote in a statement that NB Power has been working on an environmental impact assessment for the ARC-100 during the past year. And it assisted Moltex’s development efforts for reprocessing spent fuel.
All this is far less than what the federal government envisioned in the SMR Roadmap, a 2018 document developed with extensive input from the nuclear industry. It promised demonstration projects across the country; successive federal budgets allocated hundreds of millions of dollars to support them.
Canadian Nuclear Laboratories was to have an SMR called the Micro Modular Reactor up and running at its Chalk River facility by 2026. But its partner in that project, Ultra Safe Nuclear Corp., initiated a court-supervised sale process under Chapter 11 of the U.S. Bankruptcy Code in October. Another partner, Ontario Power Generation, pulled out last year.
Of the demonstration projects contemplated in the SMR Roadmap, only one appears to be on track: OPG’s proposal to build a “grid-scale” SMR at its Darlington Station. This month it received a construction licence from the CNSC to build its first reactor, a BWRX-300 designed by U.S. vendor GE-Hitachi Nuclear Energy. If completed on schedule by 2028, it would be the first SMR in any G7 country.