Areva plans upgrade for nuclear foundry at centre of probe

* Areva (LSE: 0P4A.L - news) confident about foundry's summer restart

* Wants foundry to make largest nuclear components

* Upgrade of Creusot foundry will take further year (Adds Fontana comments on Creusot upgrade, Hinkley Point)

By Geert De Clercq

PARIS, March 30 (Reuters) - Areva's nuclear foundry, under investigation for forging documents, should be able to restart by this summer and will be upgraded to make the largest nuclear components, a top company executive said on Thursday.

Commercial production at the French state-owned nuclear group's Creusot Forge foundry was halted late last year following the discovery of manufacturing flaws and the falsification of tracking documentation.

French nuclear regulator ASN has ordered Areva to make a long list of improvements before it will consider allowing the plant to restart, and a top ASN executive has told Reuters that Creusot Forge's equipment is poorly suited to making the huge components for today's nuclear industry.

Bernard Fontana, director of Areva's reactor unit Areva NP, told reporters on Thursday the company would not only ensure the foundry's procedures and quality were raised to the highest standards, but it would also invest so the plant can make the biggest nuclear components, such as reactor containment vessels.

"We accept with humility that we need to improve our procedures ... we are confident that we will be the world benchmark (in nuclear foundries)," Fontana said.

"We are aiming to be ready by summer," he added.

Fontana said Areva NP was investing 8 million euros ($8.6 million) in Le Creusot to be able to produce the largest nuclear components, which were previously subcontracted to other foundries such as Japan Steel Works.

"We want to be able to manufacture the entire range of components, including the very largest," he said, adding this upgrade would take an extra year.

Fontana said Areva would in the coming days answer a Jan. 31 letter from ASN that ordered it to specify how it would address shortcomings at the foundry.

"We have put forward an improvement plan for Le Creusot with a number of milestones in terms of technology, organisation and culture ... these integrate the comments we have received from the ASN and other regulators," he said.

He also said the use of corrector fluid at the plant - which was raised by British regulator ONR - had been limited to staff rota sheets.

Fontana added the rate of accidents involving production halts was now just a quarter of what it was 12 months ago.

Asked whether Creusot Forge would manufacture containment vessels for the two Areva-designed EPR reactors that utility EDF (Swiss: EDF.SW - news) plans to build in Hinkley Point, Britain, Fontana said Areva had the supply contract, but could do it in-house or subcontract it.

"Today, back-up schemes are in place. We will be able to do it, but in the end the customer will decide," he said.

Areva is in the process of selling Areva NP - which designs, makes and services nuclear reactors - to EDF (Paris: FR0010242511 - news) as part of a government-led restructuring and recapitalisation after its equity was wiped out by years of losses. The deal is set to be finalised in the second half of this year. ($1 = 0.9315 euros) (Reporting by Geert De Clercq; Editing by Adrian Croft and Mark Potter)