Bloomberg News

Fukushima Clean-Up Attracts Bids for $14 Billion in Projects

October 13, 2011

Oct. 14 (Bloomberg) -- Sumitomo Corp., IHI Corp. and Obayashi Corp. are among companies seeking to win decontamination contracts around the wrecked Fukushima nuclear plant as Japan sets aside $14 billion for the clean up.

Fukushima prefecture has received 143 preliminary proposals, mostly to decontaminate radiated soil and water, from companies, universities, non-profit organizations and individuals, according to documents obtained by Bloomberg News from the prefectural government.

Japan’s environment ministry will budget more than 1.1 trillion yen for decontamination by the end of the next fiscal year, Goshi Hosono, minister in charge of the response to the nuclear crisis, said Sept. 30.

“Estimating how much decontamination will cost is very difficult, so the government is trying to figure out rough figures through test projects,”said Tadashi Inoue at the Central Research Institute of Electric Power Industry who is advising the Fukushima government. “The cost will be enormous.”

Iitate village, about 40 kilometers (25 miles) from the Fukushima nuclear plant, announced a decontamination cost estimate on Sept 28 of 322.4 billion yen, suggesting the government budget isn’t big enough.

The Environment Ministry will increase the budget if it proves insufficient, said Tsutomu Utsunomiya, an assistant director at the environment management bureau at the ministry. He didn’t say by how much.

Experience Needed

Tokyo Electric Power Co.’s Fukushima Dai-Ichi atomic plant has been leaking radiation since the March 11 earthquake and tsunami disabled cooling systems leading to the meltdown of uranium fuel rods in three reactors. Cracks in the containment vessels for the melted fuel have allowed radiation leaks that will leave some areas uninhabitable for two decades or more, according to a government estimate in August.

Companies with nuclear engineering experience such as Hitachi and IHI will see demand for their decontamination technology, said Masashi Hayami, a Tokyo-based analyst at JPMorgan Chase & Co. “There are a limited number of companies that can do decontamination work because it requires sophisticated nuclear power technology.”

IHI, a Japanese heavy machinery maker, proposed a mobile water decontamination system to filter out radioactive material and a waste storage container for soil and debris, Hiroshi Nakamura, the head of IHI’s reconstruction team for the earthquake, said in an interview.

Tests First

The Fukushima government will set up test decontamination projects by the end of this month, said Katsumasa Suzuki, an official at the headquarters for disaster control in the Fukushima government. The prefecture hasn’t estimated the decontaminate costs, he said.

Obayashi, a construction contractor, is pitching a radiation monitoring system, according to the documents. Obayashi spokesman Sanshiro Kobayashi confirmed it has made proposals for decontamination projects. He declined to elaborate.

Hitachi Zosen Corp., an industrial machinery maker, proposed a radioactive soil treatment facility, according to the documents. Hitachi Zosen spokesman Teruaki Yamada confirmed it offered its technology and declined to comment on details.

Sumitomo Corp., Shimizu Corp. and a unit of Marubeni Corp. also offered proposals, according to the documents.

“It’s vital to start decontamination immediately, for the sake of residents,” said Keizo Ishii, professor of quantum science and energy engineering at Tohoku University who is advising Fukushima city. “It’s easy to tell effective from non- effective technologies once decontamination starts.”

--With assistance from Makoto Miyazaki in Tokyo. Editors: Peter Langan, Aaron Sheldrick

To contact the reporters on this story: Tsuyoshi Inajima in Tokyo at tinajima@bloomberg.net; Yuji Okada in Tokyo at yokada6@bloomberg.net

To contact the editor responsible for this story: Peter Langan at plangan@bloomberg.net


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