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The Pickering Nuclear Power Generating Station east of Toronto is shown in this 2003 file photo.The Canadian Press

Candu Energy Inc. is pursuing new reactor sales in China, with its main selling point being the ability of the Canadian heavy-water design to reuse spent fuel from the Asian giant's growing fleet of light-water reactors.

Mississauga, Ont.-based Candu Energy announced Thursday that it has signed an agreement with China National Nuclear Corp. to expand their joint project to feed recycled uranium into existing Candu reactors at Qinshan.

The intent is to design and build two multimillion-dollar advanced-fuel Candu reactors (AFCR) in China, where nuclear authorities have an ambitious growth program but are deeply concerned about long-term supplies of uranium.

Candu Energy was previously part of beleaguered Atomic Energy of Canada Ltd.; the federal government sold AECL's commercial division last year to Montreal-based SNC-Lavalin Group for $15-million.

The company expects that the flexible fueling capacity of the Candu design will become increasingly attractive as countries with light-water reactors produce large volumes of waste that must be refined, said Ala Alizadeh, Candu's senior vice-president for business development.

"We believe this combination of the strength of our performing reactors – which internationally is quite satisfactory – plus the fuel cycle will result in international jobs," he said, adding that would also create engineering and manufacturing jobs in Canada.

SNC's renewed Candu push in China is part of an overall Canadian effort to expand energy trade and investment ties with China as well as other Asian markets. This includes efforts to build pipelines to the West Coast for oil exports, plans for liquified natural gas terminals in B.C., and securing a place in China's ambitious nuclear building program.

In July, the federal government announced the completion of a new Nuclear Co-operation Agreement, paving the way for greater uranium exports to China by Saskatchewan-based Cameco Corp. and other domestic producers.

Mr. Alizadeh said Candu Energy did not need the new accord, but it is nevertheless benefiting from the positive relationship.

Over the next two to three years, Candu Energy and partner Third Qinshan Nuclear Power Co. will work to win from Chinese regulators a series of licences required to switch the fuel of the existing Candu reactors from natural uranium to recycled uranium; then to mixtures of uranium and plutonium; and finally to thorium. Mr. Alizadeh said the new design will enhance the Candu 6 reactor's fuel capability.

Candu Energy has also been qualified in the U.K. to compete to build reactors that can burn plutonium left from the decommissioning of nuclear weapons.

AECL had often announced agreements that did not materialize into contracts to build reactors, noted Shawn Patrick Stensil, with Greenpeace International.

"This is yet another promise for further study, but Candu Energy isn't making any sales," he said, adding it still works from a 40-year-old design while others offer newer, more efficient models.

Follow Shawn McCarthy on Twitter: @smccarthy55Opens in a new window

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