TOKYO -- Hitachi has agreed to continue negotiations with the U.K. on a planned nuclear power plant in Wales after the government in London expanded financial support to ease the Japanese group's concerns about its hefty price tag.
The Tokyo-based conglomerate's board voted Monday to move ahead with talks at the urging of Chairman Hiroaki Nakanishi. The U.K. has offered to lend Hitachi over 2 trillion yen ($18.2 billion) to build a two-reactor power plant on the island of Anglesey in Wales. Hitachi aims to conclude a memorandum of understanding on the project as soon as mid-June.
London previously offered to guarantee over 1 trillion yen in loans. But Nakanishi sought additional support in a May 3 meeting with Prime Minister Theresa May. The government will now provide all the loans Hitachi needs, either directly or through local financial institutions. Under the offer, Hitachi and its partners in the project would directly invest another 1 trillion yen or so.
But some of Hitachi's outside directors remain concerned about the project's risks. The company plans to insist on safeguards that reduce or eliminate Hitachi's financial responsibility for accidents at the plant.
If negotiations do not go according to Hitachi's liking, the company can pull out of the project before a final contract is signed.
Hitachi is currently the full owner of the project's developer, but looks to sell down its stake in the operations over time. Because the size of its stake in the project directly translates to its accident liability, Hitachi will continue negotiations with the U.K. If an agreement is reached, Hitachi aims to have the plant up and running sometime in the early 2020s.