The £80m loan which was promised to Sheffield Forgemasters by the Labour government and then axed by the coalition could now be back on, according to the company.
The money was earmarked for the building of a 15,000 tonne press which would be used to build ultra heavy forgings for modern civil nuclear power reactors – a host of which are to be built in the UK and throughout the world.
The new press would have given Sheffield Forgemasters a unique capability in Europe.
Now, government sources say the money could be made available again, this time through the £1.5bn Future Jobs Fund which is to be doled out through the new business led Local Enterprise Partnerships. These are replacing Regional Development Agencies.
Dr Graham Honeyman, Sheffield Forgemasters CEO, welcomed the development and expressed his desire to resume the project, although the company will now have to reformulate its plans before reapplying for the money.
He was quoted in local South Yorkshire newspaper The Star this week saying: “Since the decision to overturn the loan we have been concentrating on accelerating the development of our group companies focusing on growth areas including business development based around our 10,000 tonne and 4,000 tonne forging presses, new machine shop and the opportunities within civil nuclear and other sectors.”
He added: “We look forward to working closely with the Government to seek avenues forward on the funding issue, however the detailed business environment regarding the 15,000 tonne press has changed substantially since the project was first conceived almost three years ago and considerable, comprehensive work will have to be repeated before a new application can be made.
“This work will cover all relevant issues including supply, market demand, hardware costs, availability and the UK’s own development of a civil nuclear power programme.”
Alongside the government loan, additional funding was to be provided by a host of private investors including Westinghouse, whose AP1000 is one of two designs being considered for UK reactors. Westinghouse said “the offer remains on the table” when the funding was withdrawn in June last year.