A firm in New Brunswick that intended to construct its inaugural small modular nuclear reactor is now divesting some of its assets amid growing uncertainties about its future in the region. Moltex Energy Canada is in the process of selling its engineering designs, patents, software, intellectual property, modeling data, and other holdings to a new entity interested in marketing reactors elsewhere. Nuclea Energy Inc., headquartered in British Columbia, has made an $11.5 million offer to acquire these assets from Moltex, a fraction of the public funding received by the Saint John-based company over the past decade. Facing financial challenges, Moltex is presently under the management of insolvency administrators.
Nuclea has labeled the assets it is acquiring as “distressed assets.” Despite the sale, Moltex CEO Rory O’Sullivan affirmed that the company will persist, leaving open the possibility of proceeding with the construction of a small modular reactor in New Brunswick at a later stage. However, the likelihood of this materializing appears to be diminishing. Last autumn, Energy Minister René Legacy expressed a preference for separating the procurement of new electricity generation from the political drive for local job creation, indicating that New Brunswick is not prepared to undertake the associated risks.
In its latest filing with the U.S. Securities and Exchange Commission, Nuclea announced plans for an initial public offering on the New York Stock Exchange, with 20% of the raised capital earmarked for the Moltex acquisition. The company signed an exclusivity agreement with Moltex in December, extending the negotiation window until May 8. The sale does not encompass all of Moltex’s assets or liabilities.
Nuclea’s reactor design, named Morpheus, is distinct from Moltex’s stable salt reactor technologically. The intended markets for Morpheus include Arctic communities, data centers, mines, and remote military installations. Notably, there is no reference to Moltex’s original proposal to establish its initial reactor adjacent to N.B. Power’s Point Lepreau generating station.
Legacy, acknowledging the potential sale, expressed eagerness to engage with the new owners. Nuclea underscored that its Morpheus reactor is a pioneering design with innovative features that are still undergoing validation. A review panel examining N.B. Power reiterated earlier warnings about the risks associated with unproven technologies and recommended opting for established models like larger CANDU reactors to avert exacerbating financial challenges.
Moltex had received funding from both the federal government and the Liberal administration of Brian Gallant to develop its technology. The Progressive Conservative government under Blaine Higgs had also championed Moltex and another developer, Arc Clean Energy Canada, with ambitions to position New Brunswick as a global leader in nuclear technology. However, financial obstacles derailed the plans of both companies to deliver small reactors in time to address potential electricity shortfalls in the upcoming years.
Former Arc executive in 2024 suggested that N.B. Power explore alternative options like more advanced SMR designs that could be available sooner. Nuclea’s president, Sagar Sanghera, declined to respond to an interview request.