SCANA And Santee Cooper Agree To Amount Of Guaranty Payments From Toshiba

(RTTNews) - South Carolina Electric & Gas Company or SCE&G, principal subsidiary of SCANA Corp. (SCG), and Santee Cooper, have entered into a definitive agreement with Toshiba Corp. (TOSYY.PK) for Toshiba to pay $2.168 billion ($1.192 billion to SCE&G for its 55% and $0.976 billion to Santee Cooper for its 45% project ownership) in full satisfaction of its guaranty of obligations of Westinghouse Electric Company, LLC or WEC under the engineering, procurement, and construction contract for the two new nuclear units at the V.C.Summer Nuclear Station in Jenkinsville, SC.

In the agreement, Toshiba commits to make payments in a series of installments over a period beginning in October 2017 and ending in September 2022.

The project owners are continuing their efforts to determine the most prudent path forward for the nuclear project. However, the project owners anticipate that the additional cost to complete both units beyond the amounts payable in connection with the EPC Contract will materially exceed prior WEC estimates as well as the anticipated guaranty settlement payments from Toshiba. Additionally, the units would need to be online before January 1, 2021 to qualify for production tax credits, under current tax rules.

At this point, the project owners believe that the units could not be brought online until after this date. The project owners are considering these factors, as well as their future generation needs, in their evaluation of the project. Based on these considerations, the alternatives of completing both units or one unit are subject to significant challenges. The owners expect to announce their decisions soon.