Calgary, Alberta - Energy Alberta Corporation (Energy Alberta), has filed an Application with the Canadian Nuclear Safety Commission (CNSC) for site preparation approvals for two nuclear reactors near Peace River, Alberta. In partnership with Atomic Energy of Canada Limited (AECL) Energy Alberta seeks to bring CANDU(R) nuclear technology to Alberta for up to two twin-unit ACR-1000(R) Advanced CANDU Reactors(R).

Energy Alberta proposes initially build one twin-unit ACR-1000 that will ultimately produce a total net 2,200 MW of electricity with a targeted in-service date of early 2017.

“This is an historic moment for Canada, for Alberta and for the Nuclear power industry,” says Wayne Henuset, President and Co-Chairman of Energy Alberta Corporation. “We are proud to be pioneers in bringing the benefits of clean, safe, reliable nuclear power to Alberta.”

“This filing, the License to Prepare Site, is the first of many steps in getting licenses to build the plant,” said Mr. Henuset. “Building a nuclear power facility is a long and rigorous process. This is the beginning of a public and regulatory process that will include environmental, health and safety assessments. Public consultations will be an essential component of the process.”

The site that has been chosen is on private land adjacent to Lac Cardinal, approximately 30 km west of the town of Peace River, Alberta. This location was chosen after months of engaging the community.

Energy Alberta has chosen the Peace River region as its preferred site because of the demonstrated support from the community, existence of essential infrastructure and support services, and technical feasibility.

Mr. Henuset added, “We must also congratulate all of the municipalities from the regions of Whitecourt and Peace River for their outstanding display of leadership throughout this period. Everyone should be very proud of how their elected officials have represented them over the last several months.”

The ACR-1000 is a Generation III+, 1200 MWe class nuclear power plant built on the pedigree and proven success of AECL’s CANDU nuclear technology. The ACR-1000 incorporates 80 per cent of the technical specification from the proven CANDU 6 design such as a modular, horizontal fuel channel core, a low-temperature heavy-water moderator, waterfilled vault, two independent diverse shutdown systems, on-power fuelling and a reactor building accessible for on-power maintenance.

AECL’s Chief Operating Officer Ken Petrunik, commented, “We are very pleased to be partnering with Energy Alberta to bring the ACR-1000 to Western Canada. The ACR-1000 is a made-in-Canada solution that we believe is the best choice for Alberta in terms of safety, proven performance and project delivery.”

Energy Alberta believes that nuclear power can effectively supplement current fossil fuel power generation while offsetting greenhouse gas emissions.

The movement to go nuclear in the oil patch comes at an interesting period in Alberta’s oil-based boom time. There are disturbing suggestions that the provincial government faces a 33 per cent drop in oil and gas royalties over the next three years in part because supplies of easy-to-get conventional oil and gas have declined to the point that almost 90 per cent of wells are permanently paying lower royalty rates, many as low as 5 per cent. The highest royalty rate is about 30 per cent, but with so many wells now at the “low productivity rate,” the average royalty from conventional oil and gas is down to 20 per cent.

Natural gas, the biggest money spinner for years, which pumped $8.3 billion into the treasury in 2005-06, will bring in only about half that amount, $4.6 billion, by 2009-10. Conventional oil royalties will also come down. They’ll bring in $1 billion this year, one-third less than two years ago, and drop to just $815 million in 2009-10.

The First Paper of the Alberta Energy Futures Project published in December 2006 by the University of Calgary (Energy and the Alberta Economy: Past and Future Impacts and Implications) notes that while conventional oil production has been in decline for the past two decades, this has been offset by gains in production associated with the oil sands.

However, after rapid growth, particularly over the 1988-1998 period conventional natural gas production has now begun to decline. The ramifications of the this trend are huge, especially given that gas and gas liquids currently account for about 60 percent of the total value of oil and gas production and over two-thirds of total resource revenues paid to the provincial government.

And despite the fact that production is rising dramatically, oil-sands royalties will go down, from a high of $2.3 billion last year to $1.1 billion in 2009-10 partly because royalties in the oil sands are mostly calculated on raw bitumen, which sells at about half the price of upgraded synthetic crude. Even when production triples to 3 million barrels a day in 2020, royalties will be stuck at $1.1 billion, the same level as 2004-05, according to one report.

The only thing that is certain, notes the authors of the Alberta Energy Futures Report is that “The demand for energy will continue to grow, and with its huge concentration of energy resources, there is the potential for the province to become a leader in clean, competitive, and secure energy. The one thing we can be certain about is that meeting the challenges and unlocking the opportunities will require a clear vision and long-term commitments to that vision.”

So the Alberta government will have some interesting questions to ponder in considering the Energy Alberta Corporation application.