A company planning to construct its inaugural small modular nuclear reactor in New Brunswick is selling off some assets as uncertainties loom over its future in the province. Moltex Energy Canada is divesting its engineering designs, patents, software, intellectual property, modeling data, and other holdings to a new entity interested in marketing reactors elsewhere. Nuclea Energy Inc., based in British Columbia, has offered Moltex $11.5 million, significantly less than the public investments made in the Saint John company over the past decade.
Facing financial challenges, Moltex went insolvent last year and is now under the supervision of insolvency administrators. Nuclea terms the acquisition of these assets as dealing with “distressed assets.” However, Moltex’s CEO, Rory O’Sullivan, clarified that the company will persist and hasn’t ruled out the possibility of proceeding with constructing a small modular reactor in the province.
Despite Moltex’s longstanding presence in New Brunswick, the likelihood of its reactor plan materializing appears bleak. Energy Minister René Legacy indicated a preference for segregating new electricity generation procurement from local job creation incentives, expressing caution about assuming risks associated with pioneering initiatives. Nuclea’s recent filing with the U.S. Securities and Exchange Commission outlines plans for an initial public offering on the New York Stock Exchange, with a portion of the raised capital intended for the Moltex acquisition.
The sale agreement between Nuclea and Moltex, under an exclusivity arrangement, restricts Moltex from engaging with other potential suitors until a specified date. Nuclea’s reactor design, named Morpheus, differs technologically from Moltex’s stable salt reactor, targeting markets such as Arctic communities, data centers, mines, and remote military facilities. Notably, there is no reference in Nuclea’s filing to Moltex’s initial proposal to situate its reactor near N.B. Power’s existing Point Lepreau station.
Legacy acknowledged the potential sale, anticipating discussions with the new proprietors. Nuclea characterizes its Morpheus reactor as a groundbreaking design with unique attributes that are yet to be fully validated. A review panel evaluating N.B. Power’s operations resonated with Legacy’s previous reservations about unproven technologies, advising against adopting first-of-its-kind approaches to mitigate financial risks.
Moltex had received financial support from the Liberal government and federal authorities for technology development, with successive governments promoting the company alongside another developer, Arc Clean Energy Canada, as pioneers in nuclear technology. However, financial constraints impeded both companies from meeting deadlines for small reactor deployment amid potential electricity shortages. A former Arc executive suggested exploring alternative SMR designs that were more advanced and readily accessible.
Nuclea’s president, Sagar Sanghera, declined an interview request.