S. Korea becomes world's 6th nuclear reactor exporting nation |
By Lee Joon-seung
SEOUL, Dec. 27 (Yonhap) -- A deal that could amount to US$40 billion clinched Sunday by South Korea to build commercial reactors for the United Arab Emirates (UAE) heralds the emergence of the Asian country as the world's sixth commercial nuclear exporting nation.
The $20 billion agreement between a consortium led by the state-run Korea Electric Power Corp. (KEPCO) and Emirates Nuclear Energy Corp. calls for the building of four 1,400-megawatt light water nuclear reactors by 2020 near Sila on the Persian Gulf 330 kilometers west of Abu Dhabi. With post-construction maintainance and management contracts the deal could reach $40 billion, officials said.
The reactors are to be the indigenously developed APR-1400 units currently being built in South Korea.
In the past, only the United States, France, Canada, Russia and Japan have won overseas deals to build nuclear reactors, with South Korea only managing to sell components used for reactors and nuclear facilities.
The presidential office of Cheong Wa Dae and the Ministry of Knowledge Economy said the KEPCO-led consortium made up of such companies as Hyundai Corp., Samsung C&T Corp. and Doosan Heavy and Engineering Co., sidestepped stiff competition from France's energy giant Areva SA and the partnership made up of General Electric Co. of the United States and Hitachi Ltd. of Japan.
U.S. energy firm Westinghouse Electric Co. and Japan's Toshiba Corp. will also benefit from the deal by providing components to Doosan.
The knowledge economy ministry said securing the contract marks the first time Seoul won the rights to sell a complete commercial atomic reactor abroad despite having developed knowhow to design and build its own indigenous reactors without outside help.
"The UAE deal is testament to the competitiveness and technological prowess enjoyed by South Korea in this sector after beginning its commercial nuclear generation in the 1970s," said Na Ki-yong, head of the ministry's nuclear energy division.
He claimed that by winning the deal there will be greater global recognition for South Korean reactors that could help the South Korean industry grab further orders down the road.
The official said that the construction agreement could grow to $40 billion if Seoul provides nuclear fuel, helps manage the plants and conducts maintenance over the next 60 years. It may also help create 11,000 jobs in the country for the next 10 years.
"The reactor deal is equivalent to the sale of 1 million Hyundai NF Sonata sedans, 62 Airbus A380 double-decker passenger jets and 180,300,000-ton tankers," he claimed.
Other experts said that the UAE agreement is expected to give South Korea an edge when it bids to win prospective construction deals in Turkey and Jordan.
Turkey said that it wants to build a second nuclear power plant in the Sinop region, while Jordan has expressed plans to construct two 1 million kilowatt reactors near Aqaba.
South Korea, which is one of the few countries in the world to have continuously built nuclear power reactors after it first unit went on line in 1978, may be able to play a role in the building of reactors in the United States, China and India down the road.
Many North American and European countries had halted new construction after the Chernobyl disaster and Three Mile Island incidents.
Washington and New Delhi plan to build 30 and 50 new reactors in the coming years, while Beijing said that it intends to increase its nuclear energy output from 9 million kilowatts in 2008 to 86 million kilowatts by 2020.
Janice Dunn Lee, deputy chief of the Paris-based Nuclear Energy Agency, said that about 50 countries around the world with no past experience have shown interest in building up their nuclear energy capabilities.
It said there may be upwards of 1,040 nuclear reactors in operation around the world by 2050, from around 440 today.
KEPCO, South Korea's state-operated power supplier, attributed the deal to price competitiveness, high "capacity factor" and proven track record in safety.
In 2008, the capacity factor or average operational rate stood at 93.3 percent which is 14 percent higher than the world average, while there have been no serious accidents in over 30 years of operating nuclear power.
South Korea is the fifth largest operator of nuclear power in the world with 20 commercial reactors accounting for 36 percent of all electricity generated in the country. It plans to build 12 new reactors by 2022 with eight to be in operation by 2016.
"The country has accumulated extensive infrastructure to build and maintain nuclear power reactors with over 20,000 experts in this field. Such a solid base has made it possible for the country to build reactors faster than competitors," a KEPCO spokesman said. Faster construction time translates into a cut in building costs.
He claimed South Korea has been able to construct a reactor in about 52 months in the past, while in the United States it took 57 months and 60 months for France.