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Atomic Annie Bites The Uranium Dust

Politics / Nuclear Power Jun 18, 2011 - 11:22 AM GMT

By: Andrew_McKillop


Best Financial Markets Analysis ArticleAnne Lauvergeon, nicknamed 'Atomic Annie' and CEO of France's murky Areva nuclear corporation with activities ranging from uranium mining ventures - and adventures in Africa - to building the world's slowest and most expensive reactor, a French EPR in Finland, was officially ousted by Nicolas Sarkozy on June 16 and will quit Areva by June 29. The decision was in fact long-expected by nuclear business watchers, but the final trigger was her handling of the blow-back in France from the Japanese Fukushima disaster, adding to Areva's near-bankruptcy, its badly handled operations in Africa, USA, France, Japan and Germany, and intense wrangling inside France's ultra-secretive nuclear business with Areva always on the losing side.

Nicolas Sarkozy had originally decided to oust Anne Lauvergeon in 2010, only for the Finnish cost spiral disaster, accusing her of doing nothing to limit seemingly endless cost overruns and construction delays at Areva's first "new generation" reactor in Finland, claimed to be so safe it can withstand a wide-body jet crashing on it - when its finally built. Since Fukushima, and the near-open conflict between France's EDF and Areva, on who takes the blame for rising nuclear electricity production costs and an already admitted 30 percent price rise for French consumers in the next 3 years, and a range of other issues, events accelerated and Sarkozy acted with typical petulance and brutality.

On the plus-side, Lauvergeon only had one seeming trump card for keeping her job: a near-decade of uranium wheeler-dealing, mostly in Africa, generating Areva assets that on first glance can look monstruously attractive, but on second and subsequent study often look plain disastrous. Added to the reactor building cost disaster playing out with enraged Finnish clients, and ballooning costs for Areva's domestic French operations in several domains, from fuel fabrication and reprocessing to nuclear waste handling, it was high time for Atomic Annie to 'tirer sa reverence' and quit.

President Sarkozy's early rancor towards Lauvergeon had ratcheted up a large notch when in late 2007, with pomp and splendour he nearly sealed a deal with his then-friend Colonel Gaddafi of Libya. This by definition murky deal aimed at selling Gaddafi French nuclear tech, and possibly a nuclear desalination plant, recycling petrodollars away from rivals of Sarkozy and commercial friends of Gadddafi, headed by Silvio Berlusconi of Italy, with close and friendly big ticket deals including a string of concentration camps for Black African migrants trying to reach Europe. Amazing as it may seem to some, Gaddafi likes value for money. He found Sarkozy's nuclear deal to sell Areva reactors to Libya much too expensive and rejected the deal out of hand, possibly sealing Gaddafi's fate in Sarkozy's world of "Anybody who is not my friend is an enemy to crush". Anne Lauvergeon had failed again.

The endless cost overruns for the Finnish reactor had been hurting Sarkozy's image since he had climbed to power, and the lost deal in Libya was taken as a personal affront by France's pint-sized Napoleon: as his spin doctors told him, and he told all pressmen in range, what France needs are low cost nukes. Sarkozy also took a hit at Areva's relations with EDF, saddled with operating all of France's ageing nuclear power plants, by thundering that electricity should be produced by cost-conscious and profitable corporations. Sarkozy cited Tepco of Japan - operator of the Fukushima plant - as a nice model for Areva and EDF to copy and to work with in the USA or anywhere else, for example on a failed set-up in Florida and never concretized Middle Eastern projects. Yet another hit against Atomic Annie was clear: in almost 100 percent of cases, Areva's high-cost reactor building and operating projects never saw the light of day - they were always too expensive.

Another ratchet was clicked by Lauvergeon's inability to seal new and bigger uranium mining deals in Africa, and at least two clicks were added by the claimed Al Qaeda hostage taking in 2010, of French and non-French mining personnel at Areva's Arlit uranium mine in Niger. This event, false flag or not, caused serious damage to officially friendly relations between Sarkozy and the French protected, and probably selected military officers running Niger. The regime was accused by the French press of not protecting white French - causing outrage in the junta - and this blooper was aggravated by Lauvergeon arguing in public that Areva could not afford to protect the whites at the mine. As we know, protecting whites in Africa is a theme close to Sarkozy's so-called African strategy, highlighted by Sarkozy's 2011 Ivory Coast adventure, using military force to replace Laurent Gbagbo with the right man, Alhasan Wattari, the ex-IMF presidential wannabe approved by the USA and Saudi Arabia.

Rarely on media radar, Atomic Annie was on many occasions forced to lend her Areva Gulfstream jet to old friends of Sarkozy, often dating from when he was climbing the greasy pole of French politics. These old friends, Sarkozy told Lauvergeon, were going to fast track new and juicy contracts for uranium. They could for example work their magic on Areva uranium mining assets in Central African Republic, and sell them to China's Guangdong Nuclear Corporation. Annie thought she did all the right things, flying Patrick Balkany into Bangui, the dusty and dangerous capital of the Republic. This former mayor of Levallois-Perret and long-time Sarkozy backstage deal manager was however not enabled, in dealer jargon, to swing the contract with the Republic's dictatorial clique headed by self-proclaimed president Francois Bozizi ( in colloquial French: 'Nice Dick').

Annie had set up new, more complicated deals within the deal, bringing in her own business friends from Kabila's Congo Republic, with uranium mining interests of the most muscular type: state militias supplying uranium from the venerable Shinkolobwe mine, which supplied the Manhattan Project to produce the world's first atom bomb. The mine, officially closed since 2005 because of massive radioactive pollution and environment damage, has large stockpiles to raid and fight over, in uranium's version of Blood Diamonds. To be sure, Atomic Annie's Congo friends have clean fingernails and Gucci suits, but organized crime and state terror is very near the surface in Areva's real African strategy, but Annie had lost her touch and could not deliver the deals. Sarkozy can't stand losers.

The Samsonite briefcases swinging over and under the dealing-and-dinner tables likely did not contain enough euro and dollars to swing the deal. The Central African Republic's uranium reserves, always a little or lot more virtual than real, had not been tweaked enough by Areva to swing any deal, with any player sharp enough to sniff the snakeoil. This deal fell through, and Patrick Balkany flew back to France more than somewhat disgruntled by not getting his own cut on the deal, and happy to blame it all on Lauvergeon, to his old friend Nicolas.

To be sure, Lauvergeon's poor handling of blowback inside France to the Fukushima disaster was itself a disaster - in Sarkozy's view - and was the proverbial coup de grace for Atomic Annie. In televised parliament hearings in the first weeks following the March 11 disaster, Lauvergeon was always off-cue. She would wince, and be close to tears at the wrong moment - when the French MOX fuelled No 3 reactor at the site melted down. Later, she was not sufficiently upbeat and smiling about sales of French nuclear disaster-relief equipment to Japan and the supply of free plastic bottles of French mineral water for a small well publicized fraction of the 100 000 Japanese turfed out of the total exclusion zone around the stricken reactors.

In Sarkozy's opinion her handling of the Fukushima disaster was itself a disaster: Areva's share price plunged, and stayed down. Even French, normally so supine and nuclear-worshipping they can be told anything and love it, started talking about nuclear fears as if they were real. For a corporation now increasingly desperate to get more capital by any way, any means due to its near-bankruptcy and avoid the open humiliation of yet another massive bailout of public money, this PR disaster was enough to get her sacked.

France's 5 state-owned television channels and the most slavishly government-friendly papers like 'Le Figaro' made a point of drawing attention to Lauvergeon's high-cost and outdated, that is over-thorough nuclear disaster response proposals, such as Chernobyl-type sarcophage and entombment works costing billions, compared with almost instant and above all cheap ideas floated by competitors. These include rapidly built space frames thrown up round a reactor in meltdown, with the spaces filled by cheap expanded polystyrene panels. Despite the radiation still spewing out with no difficulty, TV viewers will no longer see the tangled wreckage and smoldering ruins inside - so everything is fine ! The Sarko Sarcophage has arrived, but Atomic Annie has left.

Sarkozy has defined nuclear power In Our Time: this will be low cost nuke business or nothing, and Atomic Annie had missed the boat. Luckily for us all, Sarkozy's re-election ship is spinning wildly and taking on more water than the Fukushima reactors took from the tsunami !

By Andrew McKillop


Former chief policy analyst, Division A Policy, DG XVII Energy, European Commission. Andrew McKillop Biographic Highlights

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.

© 2011 Copyright Andrew McKillop - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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