The $1.4-bilion Point Lepreau nuclear refurbishment is slipping behind schedule, putting pressure on NB Power and Atomic Energy of Canada Ltd. to meet the project's September 2009 deadline.

The complex refurbishment project is being shared between the two companies but it now appears that AECL is falling behind in its duty for cutting and removing the 380 reactor feeder tubes, despite special tools brought in by the federal agency to help the process.

Hay said great care must be taken when dealing with radioactive equipment, but that is taking longer than expected.

"The times have been longer than both of us have anticipated," Hay said.

Point Lepreau is the first Candu 6 nuclear reactor to be refurbished, so there is a lot of interest on AECL's part to show that it can carry off the project on time and on budget. The New Brunswick government has said if the project is late or over budget, it could shelve plans to build a second nuclear reactor with Team Candu, a consortium of companies that includes AECL.

The Point Lepreau reactor is supposed to come back on line at the end of next September and every day the project is delayed costs the province about $1 million for replacement power.

Hay won't say how far behind the retubing job actually is now. But the NB Power president was firm that AECL will be on the hook for tens of millions of dollars in damages if it's late.

Hay said both companies are looking at how to make up for time lost because of early problems with the tools.

"[The tools] haven't performed as well as people expected," Hay said. "We're not wildly off schedule but we are off schedule so we are working to find other ways so we can claw back some of this time."

Although NB Power says the pace of the retubing work continues to put pressure on the September 2009 deadline, Hay says it's too early to say it can't be done.

The refurbishment project hit its first public snag in October when two 107-tonne turbines worth an estimated $10 million each were dropped in Saint John Harbour. The turbines are now heading back to Siemens to see if they can be replaced.

Hay said shortly after the accident that there would be "pain all around" if this project is delayed because of the sunken turbines.