Areva and Rolls Royce team up in Anglo-French nuclear agreement

The UK and France have signed a nuclear energy agreement with plans to build a new nuclear power plant at Sellafield in the UK.

Areva (Euronext: CEI)is set to supply nuclear reactor cores with Rolls Royce (LSE: RR.) to provide other engineering work. David Cameron and President Nicolas Sarkozy are set to meet in Paris where the tie up will be discussed along side other areas.

The tie up will also mean UK and French companies in the nuclear energy field will be encouraged to work more closely.

The government confirmed a list of eight sites it deems suitable for new power stations by 2025, all of which are adjacent to existing nuclear sites.

The sites are: Bradwell, Essex; Hartlepool; Heysham, Lancashire; Hinkley Point, Somerset; Oldbury, Gloucestershire; Sellafield, Cumbria; Sizewell, Suffolk; and Wylfa, Anglesey.

Rolls-Royce is expected to win a £400m ($632m) share in the building of the first of the planned power plants.

"Rolls-Royce will become our prime manufacturing partner to supply some £100m of key critical components of the reactor for each EPR [next generation nuclear power plant] that's constructed in the UK." said Robert Davies from Areva UK.

Rolls-Royce plans to build a factory in Rotherham to meet orders resulting from the deal.

The coalition said the agreement will lead to a 1500 new jobs and more than £500 million of new contracts.

"This joint declaration will signal our shared commitment to the future of civil nuclear power, setting out a shared long term vision of safe, secure, sustainable and affordable energy, that supports growth and helps to deliver our emission reductions targets," a statement from Downing Street said.

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