Plans to build a new nuclear power station at Hinkley Point in England face renewed controversy after the finance director of project leader EDF resigned. As Ivor Bennett reports, shares in the French company fell 6 percent.
It's certainly not a pretty sight. Even uglier, though, are the finances. At 23 billion euros, EDF's plan to build two new nuclear reactors at Hinkley Point in Britain is more than the company's current market value. Shares have slid 55 percent in the past year. No wonder, says BGC's Mike Ingram, its finance director has abandoned ship. SOUNDBITE (English) BGC PARTNERS, MARKET STRATEGIST, MIKE INGRAM, SAYING: "Well I think it might be the straw that broke the camel's back. EDF's balance sheet has been looking extremely wobbly for some time. Earlier this month we have had rumours that they would actually have to come to the market to raise cash buyer rights issue." The company says it regrets the hastiness of Thomas Piquemal's resignation, which sources say was over the decision to press on with the Hinkley project despite a balance sheet in meltdown. The French utility's facing a 50 billion euro bill for upgrades to its domestic plants. while dividend payments have seen net debt reach over 37 billion. At a time when wholesale electricity prices are at decade lows. SOUNDBITE (English) BGC PARTNERS, MARKET STRATEGIST, MIKE INGRAM, SAYING: "One cannot help but feel that there is a political dimension to all of this, not only in respect of perhaps interference from the French government, which at the end of the day still owns 85 percent of EDF perhaps but from the UK government as well because this is a flagship project and of course it all comes against the backdrop of the ongoing Brexit debate." EDF said last month that building here would not be stopped if Britain does leave the EU. But the company is yet to make a final investment decision. Having delayed it several times already, it said it will happen 'soon'.