Factbox: South Korea's winning bid for Czech nuclear power project

Korea Electric Power

17/07/2024 14:37

SEOUL, July 17 (Reuters) - The Czech government has
picked Korea Hydro & Nuclear Power (KHNP) as preferred bidder to
build two nuclear reactors, marking South Korea's first overseas
order for a large-scale nuclear power project since 2009. 
    The final contract, including the value, remains to be
negotiated, with completion of the deal targeted for March,
South Korea's industry ministry said. 
    However, the Czech government estimated the cost of a new
unit when building two at the same site at 200 billion crowns
($8.65 billion) at current prices.    
    KHNP, a subsidiary of Korean state utility KEPCO
 015760.KS , beat a rival bid from France's EDF as South Korea
seeks to capitalise on a revival of interest globally in nuclear
power, with countries seeking to enhance energy security and 
lower carbon emissions. 
      
    HOW DID SOUTH KOREA WIN THE ORDER?
    During the bidding process, KHNP stressed its ability to
meet project deadlines and keep costs within budget based on
South Korea's previous track record, including its 2009 order
from the United Arab Emirates (UAE), South Korean officials
said. 
    South Korea's bid was considerably less costly than that put
forward by EDF, two sources with knowledge of the matter told
Reuters, declining to be identified as they are not authorised
to speak to media.
    
    NULCEAR POWER TRACK RECORD 
    In 2009, South Korea, spearheaded by KEPCO, signed an $18.6
billion deal with the UAE to build four nuclear reactors at the
Barakah nuclear energy plant, totalling 5,600 megawatts in
capacity, according to KEPCO. 
    Three reactors became operational in 2021, 2022 and 2023,
respectively, and a fourth is on track to start operations later
this year, according to KEPCO. 
    KHNP, which participated in the Barakah project, oversees 26
nuclear reactors in South Korea including some that have
operated for nearly 40 years, and is currently building two
more, according to company data. 
    The 26 reactors supply about a third of South Korea's
electricity, according to the World Nuclear Association.  
    
    WORKING FOR NUCLEAR POWER EXPORTS
    President Yoon Suk Yeol was elected in 2022 on a pledge to
boost South Korea's nuclear power industry by targetting the
export of 10 more nuclear power plants by 2030. 
    Since then, Russia's Atomstroyexport (ASE) subcontracted in
2022 to KHNP a deal worth about 3 trillion won ($2.25 billion)
to provide materials and help to build four nuclear plants in
Egypt. 
    Also in 2022, Seoul and Warsaw signed outline agreements to
assess the viability of building four 1,400-megawatt nuclear
reactors in Patnow, central Poland, using South Korean
technology, although its status is currently uncertain.
    In 2023, KHNP won an order to build a tritium removal
facility for a reactor in Romania's Cernavoda nuclear power
plant, and began working on a feasibility study for new nuclear
power facilities in the Netherlands, the company said. 
        
    SHARES CLIMB 
    Shares in South Korean nuclear power plant builder Doosan
Enerbility  034020.KS  have climbed 48% in three months, partly
on hopes about the Czech order. 
    Shares in KEPCO Plant S&E  051600.KS  and KEPCO E&C
 052690.KS , also expected to be involved in the project, have
risen 14% and 41% respectively over the same period. 

 (Reporting by Joyce Lee
Editing by Ed Davies and Mark Potter)
 ((joyce.lee@tr.com;))