Oriel Securities Nuclear Services Presentation 2006

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AMEC Nuclear the UKs leading private sector
specialist
Peter Higton
Oriel Securities, London 16 February 2006
Director, AMEC Nuclear Holdings Managing
Director, AMEC NNC
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AMEC Nuclear the UKs leading private sector
specialist

• Long track record of supplying nuclear services
• Over 2,500 employees
• Major locations in UK, Canada, France
• Turnover circa 200m
• UK 45
• International 55

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Agenda

• What we do
• Our customers
• Market developments
• Strategy positioning for growth
• Market opportunities

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What we do

• Support through total life of asset
• Focus on the three key areas
• Programme management and major project delivery
• Operations support and improvement of existing
  assets
• Decommissioning and waste management
• We also provide specialist design, engineering,
  technical and consultancy services to both public
  and private sector clients

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Track record

• 50 years experience in the UK nuclear market
• Construction of major nuclear infrastructure in
  UK(THORP, BNFL Technology Centre etc.)
• Heritage as designer / architect engineer for
  theUKs commercial nuclear power stations
• Continuing development of advanced reactor
  technology(EU programmes)
• UKs leading supplier of nuclear services
  toEastern Europe / Former Soviet Union
• Largest private sector nuclear reactor skills
  supplier in Canada
• Leading supplier to EdF and Areva reactor build
  and service

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Examples of our work UK

• Largest provider of engineering, safety and
  technical support to British Energy
• Largest provider of design and safety support to
  BNG Sellafield
• Engineering, technical and safety projects for
  Nuclear Defence Clients AWEML, Rolls Royce, BAE
  SYSTEMS, MoD
• Major programme and project delivery in UK one
  of the largest contractors at Sellafield
• Operate the UKs largest private sector
  radiochemical analysis laboratory
• Manage the CoRWM programme for DEFRA

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Examples of our work International

• Canada
• Nuclear safety and analysis support for Candu
  reactors operated by Bruce Power and Ontario
  Power Generation
• C510m contract for project management and
  service provision for restart of two Bruce Power
  reactors
• Eastern Europe and the Former Soviet Union
• Project Management Units for reactor upgrades and
  decommissioning (e.g. Ignalina, Chernobyl)
• France
• Specialist engineering services to EdF and Areva
  through AMEC SPIE

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Examples of our work GeoMelt

• Proprietary waste vitrification technology being
  used by the US Department of Energy
• Uses electric current to convert waste into a
  safe and durable glass-like material
• traps radionuclides in glass matrix
• ten times stronger than concrete
• resistant to weathering
• expected to maintain its physical and chemical
  integrity over tens of thousands of years

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Major customers
US Dept of Energy
UK Ministry of Defence
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Market developments
Power generation
Decommissioning / Clean-up

• Global warming / CO2 emissions
• Security of supply issues in UK
• Hydrocarbon resource depletion
• Retirement of existing nuclear
• generating capacity
• Supply / Demand gap forelectricity

• Environmental pressures toclean-up waste
• Government policy to clean-upnuclear waste in
  the generationthat created it
• Public perception of nuclearwaste as a problem

Issues Driving Opportunities

• Reduce outages
• Reactor life extensions
• Asset refurbishment, restarts
• New build

• Opening nuclear clean-upto competition
• NDA established with 2bn pabudget

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Strategy Positioning for growth
New Reactor Build
AMECs nuclear strategy has been to
buildcapability and experience that canmove us
beyond the construction roleinto value added
projects and services
NDA Tier 1 Contracts
Reactor Refurbishment, Restart Programmes
Technical Engineering Services
Major Delivery Projects, Tier 2 Integration
Construction
1975
2000
2010
2020
2005
2015
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Strategy Key events
AMEC/UKAEA/CH2MHILL Alliance
New Reactor Build
Bruce Restart Contract
NDA Tier 1 Contracts
NNC Acquisition
Reactor Refurbishment, Restart Programmes
Technical Engineering Services
Major Delivery Projects, Tier 2 Integration
Construction
1975
2000
2010
2020
2005
2015
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NNC acquisition July 2005

• The UKs leading private sector supplier of
  nuclear engineering, technical and safety
  services
• Strong business in Decommissioning / Clean Up
  (UK), Reactor Services (UK and Canada),
  International entry positions (e.g. Eastern
  Europe)
• Adds nuclear expertise to AMECs programme
  management, scale and global reach to create a
  strong top level competitor
• Integration and development of synergies
  progressing well(particularly NDA market,
  British Energy, Bruce A Restart)

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AMEC, UKAEA and CH2MHILL January 2006

• The Alliance will target selected NDA site
  management contracts depending on the actual
  timetable and scope
• Brings together a strong complementary set of
  capabilities that match the NDAs requirements

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Market opportunity UK NDA

• Liabilities estimate 56bn, expected to increase
• NDA formed in 2005, budget of 2bn pa spread over
  20 sites
• Market opportunity
• Right Now increasing number and scope of tier
  2 contractslet by current incumbents (BNG
  UKAEA)
• In Future for tier 1 potentially more
  profitable target-based management and operations
  contracts
• AMEC response
• Using strong position and realising NNC synergies
  to bid fornew tier 2 contracts
• Continuing specialist design, engineering and
  safety support
• Positioning and preparation to bid and win tier 1
  competitions

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Market opportunity NDA Tier 1

• Site management and operations contracts (tier 1)
  
• Small team of skilled managers
• Profit earned on delivery of programmes against
  performance targets, to ultimately take sites to
  their end state
• NDA draft timetable shows the significant
  earnings potential for AMEC is 2 years away
• AMEC is well placed with strong differentiators
• Successful tier 1 contractors are likely to be
  consortia
• Selection of the right partners will be key

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Market opportunity Canada

• Increasing need to bring retired nuclear units
  back on line, extend life with short to medium
  term potential for new build
• C20bn nuclear reactor refurbishment market
  expected in Ontario over the next 20 years
• AMEC well placed
• Established nuclear and safety analysis business
• Excellent track record
• Already supported successful restart of two Bruce
  Power Reactors
• Bruce Power
• Largest private sector utility in Ontario
• C4.25bn investment programme launched

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Market opportunity UK Reactors

• Short term
• AMEC already supports British Energys AGR
  generating fleet
• British Energy intends to invest c500m on asset
  improvement to reduce unplanned outages AMEC is
  well placed to support
• Longer term New build
• UK Government launched consultation on Energy
  Policy in January
• Widely expected that new nuclear build will need
  to be part of the energy mix
• Replacement of existing capacity would need
  c15bn investment
• AMEC well positioned
• Has already completed consultancy work for
  potential vendors, operators and the regulators
• Intend to play major role(s) in a winning
  consortium

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Summary

• The UKs leading private sector specialist
• Broad base of operations in UK, North America and
  Europe
• Strong relationships with public and private
  sector clients
• Major market developments in the UK, Canada and
  beyond
• One of the most exciting opportunities we see
  today

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AMEC Nuclear the UKs leading private sector
specialist
Questions