SOUTH Africa's Pebble Bed Modular Reactor company has been thrown a $10million (R74million) lifeline by the US Department of Energy just a week before its government funding runs out.
But it will not be enough to prevent the retrenchment of three quarters of the PBMR's 800 staff and the reduction of its executive team from 11 to three.
PBMR chief executive officer Jaco Kriek resigned earlier this month and other executives are expected to follow soon.
Lynette Milne, the company's chief financial officer, told Parliament's public enterprises committee that the US contract signed last week would earn enough in the next financial year to keep the project afloat.
"The total sum of that contract is $40million and PBMR has the opportunity to be able to participate in a consortium with Westinghouse for at least 50percent of that money to be shared between the consortium members. The revenue that we will get from this contract is an estimated $10 million."
PBMR chairperson Alistair Ruiters said he had just returned from the US, where a consortium comprising the US company Westinghouse and the PBMR won a contract to develop and license the pebble format nuclear fuel that was to have driven the development of a domestic nuclear reactor in South Africa.
The uranium pebbles will now fuel America's next generation nuclear plant, which could go into service around 2024.
"This will be an important component of the PBMR's survival. It is the first revenue stream we have had in 10 years and it affirms the value of the technology we have developed," Ruiters said.
But Milne and acting chief executive officer Alex Tsela said the decision by the Minister of Finance Pravin Gordhan not to allocate any new funds to the project in the financial year starting next week made it essential to slash the company's costs and staff.
Costing R8,7billion since 1999 and with nothing so far to sell, PBMR has been the single most expensive state owned enterprise for taxpayers.