Canadian energy officials Friday scrapped development of a nuclear reactor project to produce radioactive isotopes for the diagnoses of cancer and other illnesses, citing costs of the program.

The decision means the company’s aging 51-year-old reactor will continue to bear the burden of generating half the world’s supply of medical isotopes.

Atomic Energy of Canada Ltd. said the decision to scrap plans for the new MAPLE reactors is based on the costs of further development, as well as the time frame and risks involved with continuing the project.

“We are making the right business decision given the circumstances,” stated AECL president and chief executive officer Hugh MacDiarmid in a statement Friday. “Our board of directors and senior management have concluded that it is no longer feasible to complete the commissioning and startup of the reactors.”

AECL’s National Research Universal (NRU) reactor at the Chalk River facility in eastern Ontario will remain operational under a contract with health care company MDS Nordion, the company said.

The Chalk River reactor provides half the world’s supply of isotopes, which are used in about 25 million medical diagnoses and treatments each year. However, a sudden shutdown of the site last year triggered a medical crisis, forcing postponements of medical treatments for cancer patients in many countries.

“We recognize the important role that NRU plays in the supply and delivery of medical isotopes to patients in North America and around the world. AECL is committed to supplying medical isotopes from NRU in a safe and reliable manner,” said MacDiarmid.

The MAPLE reactors that had been under development were to be the first in the world dedicated entirely to medical isotope production and were forecast to meet the entire global demand for a radioactive substance called molybdenum-99.

Molybdenum-99 is processed and packaged for sale to big hospitals and specialized pharmacies, which turn the substance into technetium-99 to be used on patients. Technetium-99 is injected into patients undergoing body scans to assess a wide variety of conditions, including cancer, heart disease and bone or kidney illnesses.

The Canadian Nuclear Safety Commission forced the shutdown of the Chalk River facility’s research reactor due to safety reasons on November 18. The Canadian government bypassed the order of the safety regulator and the reactor was restarted Dec. 16.

“(The NRU reactor) is operating safer than it ever has been before in its entire history. This decision made today is about good governance,” said Canada’s Natural Resources Minister Gary Lunn.

The parent company of AECL’s partner, MDS Nordion, expressed frustration over the decision to stop the MAPLE project.

“MDS is disappointed that AECL has stated it will not complete the MAPLE project despite significant investment and effort over the past 12 years,” said MDS Inc. president and CEO Stephen P. DeFalco in a statement Friday.

The Canadian Nuclear Safety Commission did not immediately respond to calls.

The NRU reactor has an operating license from the Canadian Nuclear Safety Commission valid through October 2011, and AECL said it will work with the commission and MDS Nordion to continue production beyond that date.