SHANGHAI • A Chinese city has suspended preliminary work on a proposed 100 billion yuan (S$20 billion) nuclear waste processing plant following protests by residents worried about health risks.

Reports that Lianyungang, a coastal city about 500km north of Shanghai, was set to be chosen as the site for the project, due to start construction in 2020, sparked protests that began at the weekend.

The project, to be run by the state-owned China National Nuclear Corporation (CNNC) in collaboration with France's Areva, is scheduled to be completed by 2030.

"The Lianyungang municipal people's government has decided to suspend site selection and preliminary work on the nuclear recycling project," the local government said in a notice posted on its website. It did not give further details.

In a report published on Monday in the official local newspaper, the Lianyungang Daily, the local government said "no final decision had been made" on where the plant would be sited.

The closed fuel-cycle technology being used for the proposed waste project would be similar to that used at a plant at Rokkasho in Japan, which has already been plagued by delays and cost overruns.

It also threatened to take legal action against "illegal elements" it accused of "fomenting social disorder" and spreading rumours about the project.

Lianyungang, in Jiangsu province, is the location of the Tianwan nuclear project, which currently consists of two Russian-designed reactors.

Two more units are under construction and there are plans to expand further.

CNNC could not be reached for comment, but an official with the firm told state newspaper Science Daily on Tuesday that Lianyungang was just one of several candidates and the central government would make the final decision on the plant's location.

China has ambitions to become a world leader in nuclear power.

It had 30 reactors in commercial operation by the end of June this year, amounting to 28GW of capacity. It is aiming to raise that to 58GW by the end of 2020.

However, it is struggling to resolve bottlenecks in the industry, including fuel processing, waste recycling, grid access and a shortage of qualified staff.

The closed fuel-cycle technology being used for the proposed waste project would be similar to that used at a plant at Rokkasho in Japan, which has already been plagued by delays and cost overruns.

China's reactors could instead take the US route and bury waste underground, said Dr Li Ning, a nuclear scientist and dean of the School of Energy Research at Xiamen University.

"But the (Lianyungang) government gave in so quickly and, from that perspective, it does not bode well for the nuclear industry," he added.

High-profile government-driven publicity campaigns designed to promote nuclear power have not stopped Chinese citizens from taking action against such projects in the past.

In 2013, residents in the city of Heshan in Guangdong province took to the streets to protest against a uranium processing plant scheduled to be built in the city.

The project was eventually cancelled.

"These actions are happening more frequently, on a larger scale and in a more agitated way," Dr Li said.

REUTERS