Britain has a stockpile of plutonium and uranium that, if converted to fuel, could be worth nearly £160 billion and power three nuclear reactors for 60 years, scientists say.

The future of the stockpile - largely left over from burning fuel - will be decided by ministers over the next year, The Times has learnt. Its value is estimated as the equivalent of 2.6 billion barrels of oil.

The Nuclear Decommissioning Authority (NDA), which takes responsibility for the stockpile on behalf of the State, has begun to consult the nuclear industry on what to do with the 100 tonnes of plutonium, which is stored at present at Sellafield, Cumbria. The NDA confirmed that it was also talking to uranium reprocessors about the possible sale of some of the uranium, which is stored at Capenhurst, Cheshire, and is thought to be double the quantity of plutonium.

By recycling plutonium and uranium into so-called mixed oxide fuel (MOX), they can be re-used in nuclear reactors of the sort used in France, Germany, Japan and Belgium.

All three reactor designs being considered for Britain by the Nuclear Installations Inspectorate could burn MOX fuel alongside uranium. Once turned into ceramic-encased MOX pellets, plutonium can be used in a nuclear reactor, making it a valuable and relatively low-carbon fuel source.

Neil Longfellow, director of commercial recycling at Sellafield, who looks after the site's MOX plant, said: “This material - the plutonium and the uranium - is classified as neither a liability nor an asset at the moment. But I would choose to use it on the basis that it is there and it is of value - particularly as the price of oil, coal and gas remains at record highs.”

MOX is already made at Sellafield for use overseas, but a new fabrication plant would need to be built if the Government decided to burn MOX pellets in its new nuclear reactors.

This would likely cost between £1 billion and £2 billion, but recent figures from the National Nuclear Laboratory, formerly part of British Nuclear Fuels, suggested that recycling plutonium and uranium would save more than £2billion on safe disposal costs. Burning it would avoid the creation of 0.5 billion tonnes of carbon dioxide.

Reclassifying the stockpile as an asset would generate £20 billion of inward investment, without the need for government funding, the group said.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive