Areva

The French Network for Nuclear Phase-out (Réseau "Sortir du nucléaire") reveals confidential documents disclosed by an anonymous insider from EDF (Electricité de France, the main French power utility). These documents show that the “design of the EPR presents a serious risk of a major nuclear accident” - a risk deliberately taken by EDF to increase its profitability. Because it is potentially vulnerable to a situation which could have uncontrollable consequences, the EPR reactor is extremely dangerous.

"Sortir du nucléaire" has set up a group of experts to analyse these recently received documents thoroughly. Here are the first lessons we can learn from them, which are of the utmost importance.

Some operating modes could cause the EPR reactor to explode because of a control rod cluster ejection accident (these control rod clusters moderate the nuclear reaction). These operating modes are mainly related to an objective of economic efficiency, requiring the power of the reactor to adapt to electricity demand. Thus, in order to find a hypothetical economic justification for the EPR, its designers chose to take the very real risk of a major nuclear accident.

EDF and Areva (the leader of the French nuclear industry) have tried to find a solution to the problems related to the operating mode of the reactor: these efforts have failed. The French Nuclear Safety Authority (ASN) has apparently been kept in the dark about these issues.

So the EPR reactor design seems to increase the risk of a major accident, which would lead to the destruction of the confinement and mass dispersion of radionuclides in the atmosphere.

The accident scenario in detail:
According to calculations by EDF and Areva, the reactor's RIP (Instant Return to Power) control mode and the control rod cluster configuration can induce a rod ejection accident during low-power operation, and lead to the rupture of the control rod drive casing (i). This rupture would cause the coolant to leak outside the nuclear reactor vessel. Such a loss of coolant accident (LOCA - a very serious type of nuclear accident) would damage a large number of fuel rods by heating fuel pellets and claddings (ii), and thus cause the release of highly radioactive steam into the containment. So there is a great risk of a criticality accident resulting in an explosion (iii), the reactor power being increased in an extremely brutal way. Following the ejection of control rod clusters during low-power operation, the reactor emergency shutdown may fail (iv). Whatever the configuration of the control rod clusters, a rod ejection accident induces a high rate of broken fuel rods and therefore a high risk of a criticality accident (v).

For more details, see the documents disclosed by an anonymous EDF source (especially document No. 1) on the website of "Sortir": www.sortirdunucleaire.org

Notes:
i See. paragraph 6.1.6 Document No. 4
ii Cf. Table 3, Document No. 4
iii See Document n°4, Document n°5 Part 2, Rapport Préliminaire de Sûreté EPR 15.2.4.e
iv See Document n°2, note 9
v See Document n°2, note 8.2.1

Source: Press release, 6 March 2010, Réseau "Sortir du nucléaire"
Contacts: Charlotte Mijeon, International Relations Representative +33-675 3620 20 / Nuclear physicists: Monique and Raymond Sené, +33-160 1003 49 / English-speaking Media: Steven Mitchell, +33-952 4950 22 / German-speaking Media: Jean-Yvon Landrac, +33-687 3041 10

Germany: debate on n-power in CDU party.

Debate is still raging in the German government over the use of nuclear power. Chancellor Merkel has distanced herself from comments by environment minister Norbert Röttgen a day earlier. On February 20, Röttgen predicted that Germany would be free of nuclear power by 2030. By 2030, Germany's youngest nuclear power stations will have reached a lifespan of 40 years, eight longer than that agreed in 2000 on by former Chancellor Gerhard Schröder's centre-left coalition of Social Democrats and Greens. Röttgen, a member of the conservative Christian Democrats, told the Frankfurter Rundschau newspaper that even by the most skeptical of forecasts, Germany would reach its goal of getting 40 percent of its energy from renewable sources by 2030, thus allowing the country's remaining nuclear power stations to shut down. Renewable sources currently supply 16 percent of Germany's electricity. "In the coalition contract it says that nuclear power is a stopgap until renewable energy can take over the supply reliably and at competitive prices. That's exactly the line I am following." But the Federal Environment Agency (UBA) believes that this target is still achievable. "We can still cover 40 percent from renewable energy by around 2020," UBA president Jochen Flasbarth told the Süddeutsche Zeitung newspaper on the same day.  A few days later, on February 23, Peter Mueller, Christian Democratic prime minister in the German state of Saarland, said the government should stick to its timetable to phase out nuclear power. Amending the phase-out, fixed by legislation in 2002 for about 2021, “needs plausible grounds,” Mueller is cited as saying. “I don’t see those.”
Source: The Local, 20 February 2010 / Deutsche Welle, 21 February 2010 / Bloomberg, 23 February 2010

EDF-AREVA quarrel over reprocessing resolved?

As mentioned in the January 29 issue of the Nuclear Monitor there is a lot of rivalry between the French nuclear giants AREVA and EDF. In the beginning of January AREVA stopped removing spent fuel from reactors for reprocessing at the facility at La Hague. At the end of 2008, the companies agreed on a framework for contracts for the 2008-2040 period. But since mid-2009 they have not been able to settle disagreements over prices and volumes. On January 20, the two companies were given a two-week deadline by the French government to resolve their differences on this matter. On February 5, the two companies said in a statement, they would sign a contract covering “transportation, treatment and recycling” of used nuclear fuel before the end of March. The agreement reached by the two groups lays out conditions for applying the framework agreement of Dec. 19 2008, which set out a partnership covering treatment-recycling of used fuel, and reprocessed fuel fabrication, the firms said.

Source: Reuters, 5 February 2010

European Union heading for clash on funding ITER.

European governments want to slow down construction of the International Thermonuclear Experimental Reactor (ITER) because they are paying for the bulk of the construction costs and are concerned that the budget is spiraling out of control. The EU is covering 45% of the costs of building and running ITER, which is to be built in Cadarache, France. The other six partners (the US, China, Russia, India, Japan and South Korea) are each paying 9%.  Concerned about the mounting costs, the EU rejected a construction timetable proposed by ITER's administration at a meeting of participating countries on 18-19 November. The administration had proposed that ITER, which was launched in November 2006, should conduct its first experiments in 2018. But the EU's member states agreed in a position paper in November that a 2018 deadline was “not feasible”. (see Nuclear Monitor 698, 27 November 2009: “Fusion Illusions”) They reaffirmed this at a working group of the Council of Ministers on February 1. A 2018 deadline, however, is strongly backed by all non-EU countries involved in ITER, with the exception of the US, which has shown signs of flexibility. Officials said that the EU would prefer to make construction costs less painful by spreading them over a longer period of time. Concerns about the ballooning budget led the Commission last year to set up an expert group tasked with reviewing the construction costs. The group's report, released to member states in January, said that the construction costs alone could rise as high as 1.5bn Euro (compared to a 2001 estimate of 598 million Euro).Total EU-contribution of ITER-project costs could rise to 3,5 billion Euro (US$ ) instead of the 1.5 billion estimated in 2001.The countries participating in the ITER project will hold a special high-level meeting in Paris on 23-24 February to try to resolve the dispute.

Source: European Voice, 4 February 2010

Replies safety AP1000 & EPR of 'poor quality'.

UK nuclear regulators have criticised the "long delays" and "poor quality" of replies they have received from Westinghouse and Areva following safety reviews of their reactor designs, AP1000 and the European Pressurised Reactor (EPR). The Nuclear Installations Inspectorate has raised a number of serious issues on the design of the new reactors but in its latest report says the response from the two companies is less than expected.

The inspectors have already issued a formal 'Regulatory Issue' (RI) regarding the safety and control systems of the EPR and are now considering a RI on the shield building for the AP1000. Westinghouse is planning to use a new construction method for the reactor's shield building, using a sandwich of steel plates filled with concrete, rather than the conventional reinforced concrete. Regulators say they will have to be convinced the new techniques will be sufficient to withstand an accident, including a crash of a large aircraft. Westinghouse said it changed its construction methods in response to US regulations after 9/11 requiring it to withstand an aircraft impact.

Source: N-Base Briefing 642, 10 February & 643, 17 February 2010

Kakadu mine: Uranium contamination 5400 times background.

Australia: environmental regulators for the office of the Supervising Scientist admitted to a Senate Estimates committee on February 9, that water with uranium concentrations 5400 times background and a cocktail of other radionuclides are seeping from beneath the tailings dam at the Ranger Uranium Mine in Kakadu National Park. The Office of the Supervising Scientist acknowledged to Australian Greens Senator Scott Ludlam that the contamination was occurring, and said that the estimated amount of 100,000 liters per day was based on modeling and not measurement. "The biggest surprise is that despite knowing about this leakage for years, the regulators don't know how much is seeping, where it is going, or how highly contaminated it is. The regulator suggested that directly sampling this contaminated water would be 'impractical.' I suggest that it is now essential", Senator Ludlam said. "The mining company ERA booked a 2009 profit in excess of A$270 million dollars (US$240m or 177m Euro) and yet the regulator won't compel them to undertake any water quality sampling under the tailings dam. That has to change." Uranium is only one of a number of radioactive elements present in the tailings dam – others include Thorium, Polonium, Radon, Radium, Bismuth, etc.

Source: Media release Australian Greens Party, 9 February 2010

The United Arab Emirates dropped a bomb in the nuclear energy world by choosing South-Korean nuclear technology over western reactors. Market analysts and company strategists need to swiftly adapt to a new nuclear market outlook. Following this serious setback, the French nuclear giant AREVA now considers to sell generation-two reactors to countries that are new to nuclear power, even though safety standards in Western countries would not allow these old designs to be built.

Greenpeace International - The US$20 billion (14.2 billion Euro) tender for four reactors in UAE was highly contested, with GE/Hitachi and a French consortium of AREVA, GDF Suez, Total and EDF competing with the South-Koreans to build the first Arab nuclear power reactor. The South-Korean reactors were selected over France’s nuclear flagship the EPR (European Pressurized-water Reactor), and AREVA is now picking up the pieces after this rather humiliating defeat in Abu Dhabi.

Though the low costs of the South-Korean reactors are generally thought to be the main driver behind UAE’s choice, other factors have played a significant role. Serious delays and cost overruns at the first EPR under construction in Olkiluoto, Finland, have shed doubts on AREVA’s ability to live up to its promises. Also the more and more public row between AREVA and EDF, the other French nuclear company, has not helped in securing the billion dollar bid in UAE. EDF was requested to join the EPR consortium that ran in the UAE tender, but was, according to AREVA CEO Anne Lauvergeon, too late in responding. The nuclear power struggle between the French giants has since deepened, the companies disputing uranium enrichment and nuclear fuel processing. See box at end of this article

The South-Korean government and KEPCO, the company leading the consortium in the UAE bid, seemed to relish in the unexpected triumph. The first nuclear power plant in the Arab Gulf will be the first nuclear reactor exported from South-Korea. The South Korean government immediately fantasizes of expanding its nuclear industry, targeting a 20 percent share of the global nuclear reactor market by 2030 through exports of 80 nuclear reactors. The KEPCO reactor is an updated second-generation 1,400 MW light water reactor APR-1400 (Advanced Pressurised Reactor), of which the first two are currently under construction in its home country.

The UAE decision sparked an internal review of AREVA’s product range. The company considers reintroducing second-generation 1,000 MW reactors for client countries that are new to nuclear power. These reactors will be cheaper and less sophisticated than the third-generation EPR reactor that has been marketed aggressively by France all over the world.

According to a senior AREVA executive, ‘safety standards in the US and Europe would not allow a second-generation reactor to be build’. However, this does not stop France to consider selling the older, simpler designs to countries without any previous nuclear experience. The French president Sarkozy even endorses the need to broaden the array of nuclear offerings in order to prevent further failures to win deals: "There is no doubt that we need to restructure the sector and there is no doubt that we need to raise the issue of coming up with a broader set of offers."  AREVA estimates that 20 per cent of the global market could be open to second-generation reactors. Rumors suggest EDF may take the lead in selling these reactors in markets new to nuclear energy.

Sources: Financial Times, 14 & 19 January 2010 / The Times, 18 January 2010 / Nuclear News Flashes 13 January 2010 / Reuters, 22 January 2010 / Greenpeace Nuclear Reactor weblog 7 December 2009.

Contact: Rianne Teule,  Nuclear campaigner Greenpeace International. 

Nuclear turbulence.

The sibling rivalry between the French nuclear giants AREVA and EDF has become a public fight, with the French prime minister Fillon acting as referee. The ego’s of the companies’ CEO’s, Anne Lauvergeon for AREVA and Henry Proglio for EDF, seem too big for one room, and media jump eagerly on each blaming the other for failing to keep promises and responsibilities. The pot calling the kettle black..…

AREVA blames EDF for signing a contract for enrichment services with the Russian company Tenex. EDF seeks to diversify its supplies of nuclear fuel from non-French enrichment suppliers like the Anglo-German-Dutch Urenco and Tenex, instead of continuing to take uranium from the French enrichment facility Eurodif. Eurodif still uses gas diffusion technology, while the new Georges Besse II centrifuge enrichment plant is planned to be fully operational only in 2012. Unless EDF agrees to buy services from the Eurodif diffusion plant after 2009, AREVA could be forced to cancel the scheduled initial production in the new Georges Besse II plant. Though this might be an empty threat, it is clear that AREVA needs EDF to buy enrichment services in order to make a smooth transfer from gas diffusion to the new centrifuge plant. A committee of AREVA officials have denounced EDF’s uranium contracts with the Russians as ‘non-patriotic’ and ‘anti-European’.

On top of that, in the beginning of January 2010 AREVA has stopped removing spent nuclear fuel from reactors for reprocessing at the facility in La Hague, Normandy. EDF and AREVA have not been able to agree on a new contract to continue reprocessing of spent fuel from EDF’s nuclear power plants. The new reprocessing contracts have been disputed for many months without any progress. The previous contract to reprocess spent nuclear fuel at La Hague, which expired in 2008, was worth 800 million Euro (US$1.15 billion) per year. At the end of 2008, the companies agreed on a framework for contracts for the 2008-40 period, but since mid-2009 have not been able to settle disagreements over prices and volumes.

The French nuclear row plays in a setting in which the whole nuclear sector in France is challenged on its transparency on nuclear waste issues. The documentary 'Waste, the nuclear nightmare', aired in October 2009, has sparked a national debate on nuclear waste in France. The High Committee for Transparency and Information on Nuclear Safety (HCTISN) conducts a full inventory of France’s nuclear waste products and transports. Greenpeace has blocked uranium transports to Russia several times, calling for a moratorium on the waste transports to Russia.

For the twelfth consecutive year, The Nuclear Monitor is proud to publish the annual Uranium mining Issues Review. The reviews are compiled by Peter Diehl from the WISE Uranium Project. First published in the last issue of 1998 it gives an in-depth overview of developments regarding all aspects of uranium mining: mines, exploration, environmental issues, indigenous people, production and so on.

WISE Uranium Project - During the course of the year 2009, the uranium spot market price, as published by Ux Consulting (UxC), declined further by 16% from US$ 53 to 44.50 per lb U3O8, with oscillations in the range of US$ 40 (April 6) to US$ 54 (June 22). The year-end value represents just one third of the unprecedented June 2007 peak of 136 US$ per lb U3O8.

The long term average price, as published by Cameco, showed a constant decline from US$ 69.50 to 61 per lb U3O8.

For the first time, Kazakhstan apparently became the largest uranium miner worldwide; detailed figures are not yet available, however.

The further decline of the uranium price slowed down many exploration and mine development projects in the short term. However, in expectation of a supply problem in the near future, many major players made serious efforts to secure uranium deposits suitable for future exploitation.

Uranium exploration and new uranium mine projects

Uranium exploration continues in many parts of the world, often accompanied by protests. Opposition was particularly powerful against exploration at Lac Kachiwiss in Québec (Canada), at the Grand Canyon in Arizona (USA), Quebrada de Humahuaca UNESCO World Heritage area in Argentina, several places in Finland, and Kurisková in eastern Slovakia.

New interest in uranium exploration arose especially in the Middle East and northern Africa, namely in Algeria, Libya, Egypt, Jordan, Turkey, and Oman.

New mine projects are still being developed, but quite a number of higher cost projects (particularly in the U.S., but also in South Africa, Mongolia, and Australia) have been put on hold for lack of feasibility, or their profitability is still unclear.

The dewatering of the almost completed Cigar Lake mine cavity that was flooded in 2008 by a sudden water inflow is still ongoing; the McClean Lake mill that was intended to process part of the Cigar Lake ore has therefore to be temporarily shut down for lack of feed material.

In the U.S., the licensing process has begun for the first three uranium in situ leach mines based on NRC's controversial Generic Environmental Impact Statement (GEIS) plus site-specific supplements; all are located in Wyoming.

Furthermore, an application has been filed for the construction of a new uranium mill (Piñon Ridge) in Montrose County, Colorado, although the only operating uranium mill in the U.S. - the White Mesa mill in Utah - had to halt processing of uranium ores for economic reasons just months earlier.

Areva's huge Imouraren mine project in Niger received an operating license; construction started, but the size and profitability of the project are still unclear.

In Botswana, the EIA process for the Letlhakane uranium mine project was started.

In Gabon, Areva eyes resumption of uranium mining at Mounana.

In Malawi, the country's first uranium mine at Kayelekera started operation.

In Namibia, construction of Areva's Trekkopje mine continued; meanwhile, the licensing process was initiated for Bannerman Resources Ltd's huge open pit mine project (3 km length, 1 km wide, 400 m deep, with acid heap leaching) on the extremely low grade Etango uranium deposit; its Environmental and Social Impact Assessment was open for comment for just one month and important chapters were just missing. A feasibility study commenced for Extract Resources Ltd's even larger Rössing South deposit.

In Tanzania, studies on the feasibility of the mining of several deposits are underway; uranium extraction is to start in 2011.

In Zambia, a mining license was approved for the Chirundu uranium mine project. At the Lumwana copper mine, uranium-rich copper ore is being stockpiled for potential later processing; although the stockpile reached almost 2 million t in the meantime, processing is still not assured. The licensing process for Denison's Mutanga and Dibwe open pit uranium mine/acid heap leach project in Siavonga district commenced with publication of the Environmental Impact Statement and Resettlement Action Plan for the necessary relocation of 107 households.

In South Africa, uranium production commenced at the Ezulwini gold mine.

In India's northeastern state of Meghalaya, serious protest developed against the proposed mining of the Domiasiat uranium deposit; several demonstrations with thousands of participants were held; night road blockades led to several violent incidents. Protesters suspended their agitation after the state government offered talks.

Opposition also developed against uranium mining projects in other Indian states, namely Andhra Pradesh, Jharkhand, and Karnataka.

In South Australia, the Beverley Four Mile Uranium in situ leach project received federal approval, which is now subject to court review.

In Western Australia, the state's new uranium-friendly policy led to a race for the first mining licenses. The proposed mines include Kintyre, Lake Way, Yeelirrie, Lake Maitland, and Wiluna.

Several of the currently proposed new uranium mine projects are to use various heap leaching schemes. This method poses particular environmental challenges and was rarely used during the past two decades. It is now being reintroduced for the recovery of uranium from ores with grades so low that had not been processed during the period of low uranium prices.

Projects for recovery of uranium from alternate resources (such as phosphate, various types of tailings, coal ash, or seawater) continue at a slower pace, since they are likely to become viable at higher uranium market prices only.

Issues at operating uranium mines

The life of two major mines is to be extended further, after both of them narrowly avoided permanent closure:

Energy Resources of Australia (ERA) is keen to keep the Ranger uranium mine in Australia open beyond 2021, to the dismay of the Traditional Owners.

Rössing expects to produce 4,000 t uranium per year at its mine in Namibia until 2023.

The size of the massive expansion planned for BHP's Olympic Dam copper/uranium mine in South Australia is still unclear. Eminent scientists warned of a "mind-blowing" health risk from the mine expansion.

Expansion plans were also announced for the Langer Heinrich mine in Namibia and the Kayelekera mine in Malawi (both only recently commissioned), the Jaduguda mine in Jharkand (India), and the Beverley in situ leach mine in South Australia.

During the course of the year, several existing mines had to shut down for insufficient feasibility: the mine on the Caribou ore body at McClean Lake (Saskatchewan, Canada), the uranium in situ leach mines at Vasquez, Kingsville Dome and Rosita (Texas), the Sunday Mine (Colorado) and the Rim mine (Utah). In addition, the White Mesa mill in Utah (the only operating uranium mill in the U.S.!) halted processing of uranium ores and currently only processes certain uranium-containing wastes, called alternate feed materials.

A major production setback at the Olympic Dam mine in Australia scared the uranium market participants, leading to a temporary recovery of the spot market price: a breakdown of the ore haulage system seriously affects production since October.

Abandoned mines and decommissioning issues

Toxic water filling abandoned gold/uranium mines near Johannesburg (South Africa) may reach the surface and pose a health nightmare for up to 1000 residents in informal settlements. A report prepared by international experts calls for immediate action.

In Kyrgyzstan, a UN Special Rapporteur found that the country has not properly addressed the hazards of abandoned uranium mill tailings; the General Prosecutor's Office then demanded Mailuu-Suu local authorities to remedy violations at the uranium tailings dumps.

In the U.S., the long-awaited relocation of the Atlas Moab uranium mill tailings pile in Utah from the bank of the Colorado River to a safer disposal site finally started - 25 years after the shutdown of the mill. Officials are now developing "aggressive solutions" for groundwater remediation at the site.

At the former Midnite Mine site in Washington, public health hazards are possible, according to a report prepared by a federal government agency.

At the Smith Ranch site (Wyoming), the U.S. NRC cited Cameco for failure to decommission in-situ leach mine units in time.

In France, Areva tried to block a TV documentary on residual contamination left around former uranium mine sites in France. Subsequently, a new NGO announced to monitor radiation at former uranium mine sites in the Limousin area.

In Gabon, a survey conducted by NGOs still identified elevated radiation levels around Cogema/Areva's decommissioned Mounana uranium mine site, while Areva eyes resumption of uranium mining in Gabon.

Legal and regulatory issues

Worldwide, three environmental activists are currently imprisoned for their work on uranium mining:

In China, Sun Xiaodi was sentenced to two years of Reeducation-Through-Labor, his daughter Sun Dunbai to one year and a half. The authorities assert that Sun Xiaodi stole information relating to the state-owned No. 792 Uranium Mine in Gansu, and gave it to his daughter to supply to overseas organizations.

In the Democratic Republic of Congo, human rights association ASADHO/Katanga issued a report on the history of illicit mining at Shinkolobwe, whereupon Golden Misabiko, president of the association, was arrested and sentenced to one year of imprisonment.

Problems do not only exist with the environmental impacts of uranium mine operations, but also at the regulatory level:

The Environment ministry of Saskatchewan - one of the world's largest uranium mining provinces - has a "massive capability and capacity deficit" in the uranium mining sector, according to a consultant's report. The consultant suggested the province could contract a private sector expert [!] to support its uranium regulation work.

Malawi's draft uranium regulations are "essentially a self-regulation system, which will ultimately result in releases (of contaminated water) that are under-reported, uncontrolled and hidden from the affected public", according to a report by Australian scientific consultant Howard Smith.

As many new countries are planning now to join the uranium mining business, the problem of inadequate regulatory oversight is likely to widen in the near future. The International Atomic Energy Agency (IAEA) is currently organizing a series of related beginners' courses, but these can only be seen as a first step to deal with the problem. Likewise, the NGOs in these countries have to train their skills to deal with the new threat. Related workshops were held in several African countries for this purpose, already.

Uranium Trade and Foreign Investments

After obtaining, in 2008, the Nuclear Suppliers Group's (NSG) nod for uranium imports, Non-NPT signatory India signed uranium supply deals with Kazakhstan, Namibia, and Mongolia, among others. Canada, too, hopes to supply uranium to India soon, while Australia still declines such exports, though India is urging Australia to reassess its position. In the meantime, India did not rule out to use its domestically mined uranium for non-peaceful uses.

China received the first shipment of uranium from Australia's Olympic Dam mine. It further came to light that export of uranium-containing tailings from Indonesia to China is taking place unregulated since 2005.

China, India, Russia, Japan, and France are aggressively securing promising uranium deposits in many parts of the world now, mainly in Africa, Asia and Australia. So far, nuclear power production is quite low in both China and India, but they intend to massively expand it, while their known domestic uranium resources are only inferior.

The current spread of uranium activities to many new countries urges a more efficient safeguards scheme; this was highlighted by Malawi government's ignorance of the uranium tonnage exported from the new Kayelekera mine. It is unclear, how the International Atomic Energy Agency (IAEA) will keep up with these new developments.

Quote of the year:

"We're taking the uranium out of the ground, we're exporting it to be used for productive purposes, so we should be getting a medal for cleaning up the environment."

(Neville Huxham, Malawi country director for Paladin Energy Africa, IPS Aug. 24, 2009)

Earlier annual uranium mining reviews can be found in Nuclear Monitor issues 682 (2009), 665 (2007), 650 (2006), 640 (2005), 623 (2004), 600 (2003), 579 (2002), 560 (2001), 540 (2000), 522 (1999) and 504 (1998) or at http://www.wise-uranium.org/uissr09.html

Source and contact: Peter Diehl at the WISE Uranium Project, Email: uranium@t-online.de, Web: www.wise-uranium.org

Non-proven Korean reactors for Middle-East.

A South Korean consortium has beaten French, US and Japanese competition and won a US$20.4 billion contract for developing a civilian nuclear program for the United Arab Emirates. Lead by KEPCO the groups also includes companies as Hyundai Engineering and Construction, Samsung and Doosan Heavy Industries. Korea Nuclear Fuel Co, or KNF, will provide the nuclear fuel while Korea Plant Service and Engineering Co (KPS) will be involved in plant maintenance. Non-Korean companies involved in the Kepco team include Westinghouse of the US and Toshiba of Japan. Kepco is owned by the South Korean government and is the world’s third largest nuclear energy businesses. The other bidders in the year-long process included a consortium of French companies – Areva, Total and GDF Suez – by many seen as the most likely winner of the tender - and a third consortium of US and Japanese companies, including General Electric and Hitachi. Loss of the nuclear reactor contract is a major blow to especially the French nuclear industry. French President Sarkozy has extensively been traveling the Middle East , including the UAE in an attempt to bring new orders back home to the state-owned Areva.

The UAE is hoping to become the first Arab Gulf state to develop a civilian nuclear program and the contract involves the design and construction of four 1,400 megawatt units of the APR1400-type, Generation III units. Design was developed by the Korean nuclear industry under the leadership of Kepco over a period of 10 years beginning 1992. The first of the APR1,400 units, Shin-Kori units 3 and 4, are now under construction, having obtained a construction permit from the Korean regulatory authority. Shin-Kori unit 3 is scheduled to be connected to Korea’s grid by 2013. According to the UAE nuclear safety regulator, the Federal Authority for Nuclear Regulation (FANR), Kepco will construct plants that are essentially the same as the “reference plants,” but supplemented with changes required to adapt to UAE climactic conditions and any specific requirements of the UAE.

The UAE hopes the first of its nuclear units will begin producing electricity to its grid in 2017, with the other three being completed in 2020. In spite of being the world’s third largest oil exporter and home to the world’s fifth largest proven natural gas reserves, the UAE is already a net importer of gas to fuel industries and power stations. Demand for electricity in the UAE is currently about 15 GWe, but is projected to nearly triple in just 12 years. Natural gas is the fuel of choice for peak power and half of base load demand in the UAE. Oil provides the rest. No coal is burned in the UAE for electricity. The heart of the UAE base load energy plan is to swap out the natural gas plants for nuclear energy to power water desalinization and electricity for household and industrial use.

Sources: http://djysrv.blogspot.com/2009/12/south-korea-wins-uae-204-billion.html / Financial Times, 27 December 2009 / Khaleej Times, 28 December 2009

England: Tories: We will not build nuclear power stations if elected.

Political Parties not in the government have to speak out against the ruling parties to show they are in opposition. Sometimes that mechanism has strange consequences. The English Conservative Party is a well known proponent of nuclear power. But since the ruling Labour Party shows some dedication to build nuclear reactors, the Tories, changed position. Well, it seems… Early December, the green adviser of Tory leader David Cameron has thrown more doubt on where the party stands over nuclear power after declaring no new stations would be built under a Tory government. Zac Goldsmith, one of Mr Cameron’s closest advisers on the environment, insisted no new nuclear power stations would be built if the Conservatives were to win the next general election. He said Tory policy “was to give a green light to nuclear power as long as there is no call on the taxpayer, not just in terms of building, but maintenance, security and disposal of waste." His next sentence was a very surprising one: "In the history of nuclear power there has never been a station built without huge use of taxpayers’ subsidy.”

Jamie Reed, Labour member of parliament for Copeland (Cunbria) reacted: “This is not a policy, it is ignorant, confused nonsense and is in effect an anti-nuclear policy. David Cameron is all over the place on nuclear. He has stated that it is a “last resort”. And concluding: "With others I have worked hard to build a cross party consensus and I am saddened by the fact that David Cameron and Zac Goldsmith remain anti nuclear." Well, that has to be seen, but let's hope that is still the case when they win the next elections.

Source: North West Evening Mail (UK), 2 December 2009

Areva confirms Greenpeace’s alarming radiation findings in Niger.

Following Greenpeace’s report of radioactive hotspots in the uranium mining city Akokan in Niger, Areva has confirmed that the radioactivity in the streets of Akokan was unacceptably high. Under pressure from civil society the French nuclear company has taken action to clean up the spots indicated by Greenpeace. “Areva’s reaction supports our call for a comprehensive, transparent and independent environmental assessment of the area,” said Dr. Rianne Teule of Greenpeace International. “We are glad that the streets of Akokan have been partly cleaned up, but remain very concerned that  other problems cannot be ruled out without a comprehensive study. Decades of uranium mining have created radioactive dangers to the people of Akokan, a typical example of environmental and health threats posed by the nuclear industry.”

A Greenpeace team visited Areva’s two uranium mines in Niger at the beginning of November 2009. During this visit Greenpeace identified dangerous levels of radiation in the streets of Akokan, at one location up to 500 times higher than the normal background levels. Areva had earlier declared the streets safe. A comprehensive report on Greenpeace’s findings will be published in early 2010.

Source: Greenpeace International Press release, 5 January 2010

Preparations for first ever High Level Waste shipment from Sellafield.

More than ten years later than originally scheduled, the first shipment of vitrified High Level Waste (HLW) is expected to be shipped from Sellafield to Japan early in 2010. Sellafield Ltd announced November 25, that the first HLW return shipment to Japan was expected to be completed by next in March. Depending on which of three recognised sea routes was selected, the return could take up to 6 weeks – indicating a departure from the UK sometime in January 2010. It is likely that the HLW, loaded into transport containers, will be sent from Sellafield to Barrow docks by rail and loaded onto the Pacific Sandpiper for the 25,000km voyage to Japan.

The upcoming shipment will be the first repatriation of any category of foreign waste to overseas customers – despite Japanese and other wastes having been produced for more than thirty years by the reprocessing of Japanese spent fuel at Sellafield’s Magnox and THORP plant. Whilst  overseas reprocessing contracts signed after 1976 required customers to take back all reprocessing wastes, a system of ‘waste substitution’ was agreed between Government, Sellafield and customers in 2004 whereby only HLW would be returned – leaving the significantly larger volumes of Intermediate and Low level wastes to be disposed of in the UK. To compensate for the amount of radioactivity in those wastes that will remain in the UK, a ‘radiological equivalance’ will be returned to overseas customers in the form of additional HLW. For Japan, whose utilities will receive around 850 canisters of HLW directly resulting from their reprocessing contracts, the equivalence amounts to an extra 150 canisters, making 1000 in total.

Sellafield owners NDA have said that an overall total of 1850 HLW canisters are due to be repatriated to Japanese and European customers over the coming years. INS has confirmed that following the first return to Japan, the next HLW shipment will be to the Netherlands.

Source: CORE Briefing, 16 November 2009

Unlimited licence for Swiss nuclear power plant.

An environment ministry decision to grant an unlimited licence to the Mühleberg nuclear power station has prompted mixed reaction.The operators of the Mühleberg plant (outside the capital Bern) said they welcomed the move because it finally puts all five nuclear power stations in Switzerland on par with each other. The Mühleberg facility became operational in 1972 and had a licence that was due to run out by the end of 2012. An application has already been handed in to built a new reactor in ten years’ time.
Critics of nuclear power described the decision as irresponsible and scandalous. They pledged to challenge it in court. The Swiss Energy Foundation said the Mühleberg plant had safety problems. The technology used at the plant is also outdated according to the centre-left Social Democrats and the Green Party. In November 2009 voters in canton Vaud came out against extending the life of the plant beyond 2012. The governments in four other cantons which are customers of the plant were divided.
Source: Swissinfo.ch, 22 December 2009

Canada: Sept-Iles residents want Quebec to halt uranium mining.

Some 1,000 protesters gathered on December 13, in the town of Sept-Iles about 900 kilometers northwest of Montreal on the North Shore to protest against uranium mining. The residents continue to pressure Quebec to slap a moratorium on uranium exploration in the province, despite the government's promise to open a debate on health and safety concerns  surrounding the industry. The protesters were backing 20 doctors who threatened to quit their practice in the remote Quebec region because of plans to build a uranium mine nearby. "We're showing our support," said Marc Fafard, spokesman and founder of a grassroots group opposed to uranium mining in the province. "We want to show how proud we are of the doctors to have finally made this a provincial debate. Like it should be." The province's head of public health, Dr. Alain Poirier, met with the doctors the week before the demonstration and announced Quebec would create a special committee to study the potential risks of uranium exploration and mining on health and safety. The uranium debate has been raging in the region for more than a year, since mining company Terra Ventures Inc. began exploration for low-grade uranium near Lac Kachiwiss, some 20 kilometers north of Sept-Iles. Residents have concerns over the health and safety of uranium mines and fear the mining waste could contaminate local drinking water.

Source: The Canadian Press, 13 December 2009

Canada: Province threatens lawsuit over cost overruns. 

The Province of New Brunswick said Canada's federal government should cover cost overruns on the refurbishment of the Point Lepreau nuclear power plant or the province will sue Atomic Energy of Canada Ltd., according to the Canadian press reports. AECL is the government-controlled "crown corporation" that is performing the Can$ 1.4 billion (US$1.36 billion, 937 million Euro) renovation of Atlantic Canada's only nuclear power plant. The project was supposed to have been completed last September, but is running 18 months behind schedule. If the project remains behind schedule, officials say it could cost the province about $400 million (US$387 million) to buy replacement power. Under a memorandum of understanding signed last fall, New Brunswick won't be paid for Point Lepreau until the refurbishment is complete and the plant is generating electricity. This is the first refurbishment of a Candu-6 reactor and AECL is hoping to use Point Lepreau as a showcase to refurbish similar reactors around the world. In November two units of the Bruce A nuclear plant (earlier CANDU-types) have been given regulatory approval for refuelling and restart  after being out of service for more than a decade. Their major refurbishment (amongst others the replacement of fuel channels and steam generators) was over budget for almost Can$ 1 billion and 12 months behind schedule. (Read more in 'Restart go-ahead for refurbished Canadian units'; Nuclear Monitor 698, 27 November 2009)

Sources: Power Engineering International, 11 January 2010 / Nuclear Monitor 698, 27 November 2009

Heavy forging facility in India. 

Construction has started on a steel manufacturing and heavy forging facility in Gujarat state, India, as part of a joint venture between Nuclear Power Corporation of India Ltd (NPCIL) and Larsen & Toubro (L&T). During a ceremony on 9 January the foundation stone for the new facility was laid at L&T's existing manufacturing site in Hazira, Surat. The new facility will have a dedicated steel melt shop producing ingots of up to 600 tons, as well as a heavy forge shop equipped with a forging press that will be amongst the largest in the world. The facility will supply finished forgings for nuclear reactors, pressurizers and steam generators, and also heavy forgings for critical equipment in the hydrocarbon sector and for thermal power plants. L&T is India's biggest engineering and construction company and makes reactor pressure vessels for the country's pressurized heavy water reactors (PHWRs), fast breeder reactor and steam generators. It has been involved in supply of equipment, systems and services for nearly all the PHWRs that have been indigenously built, including the manufacture of calandrias, end-shields, steam generators, primary heat transport system and heat exchangers.

The capacity worldwide for heavy forging for nuclear reactors is very limited. At least in the short term, only one facility in the world, Japan Steel Works, can cast large forgings for certain reactor pressure vessels. JSW is aiming to produce sufficient forgings to supply theequivalent of about 8.5 sets a year by 2010 and the maximum ingot size is to be increased to 650 t.. The problem is the term “equivalent” because it is unclear how much of the forging capacity is dedicated in practice to new nuclear projects. JSW also supplies, for example, about 100 forgings a year for fossil fuel turbine and generator rotors to China alone.

Sources: World Nuclear news, 11 January 2010 / World Nuclear Industry Status Report 2009, M. Schneider, S. Thomas, A. Froggatt, D. Koplow

A Greenpeace team visited Areva's  two uranium mines in Niger from 1-9 November. During the visit Greenpeace found dangerous levels of radiation in the streets of Akokan, a mining city located close to both mines. Areva had earlier declared the streets safe.

On November 26, Greenpeace is releasing the first results of its survey to the authorities and companies involved, and calling for an independent inspection, followed by a comprehensive clean-up to address the impacts of the French nuclear company’s activities in Niger.

“Areva’s mining operation has created a radioactive threat to the people of Akokan; one that it has failed to address despite two years of effort.” said Dr. Rianne Teule of Greenpeace International, “It is time for a full and independent inspection of this area.”

In 2007 the independent French laboratory CRIIRAD identified the problem of radioactive debris from the mines being used as building materials in the streets of Akokan [1] and reported this to Areva and local authorities.

According to Areva, shortly afterwards Akokan was checked and 11 locations with high radiation levels were cleaned up [2]. A map made by Areva’s mining company after the clean-up shows that radiation levels at those 11 locations were close to or at normal background levels, implying the town was safe.

The Greenpeace team performed a small survey in the streets of Akokan, on and around the 11 locations. The survey identified seven locations with significant radiation levels [3]. At three locations, the Greenpeace measurements directly contradict the data on the Areva map. In one area the levels were as high as 63 microSv/hr at 5 cm, almost 500 times higher than normal background levels.

“These radiation levels represent a danger to human health. People spending time in the streets could be exposed to a significant dose of radiation. There is a further risk that radioactive dust could be released from the contaminated spots. Inhaling radioactive dust is a serious health risk.” says Dr. Paul Johnston from Greenpeace Science Unit at the University of Exeter. “The town should be cleaned up immediately.”

This scandal demonstrates again that the nuclear industry is a threat to the environment. Greenpeace calls for the whole town of Akokan to be thoroughly inspected, followed by an exhaustive clean-up, to ensure residents are safeguarded from the risks of the uranium mines.

Notes:
[1] Note CRIIRAD N°07-53, Présence de matériaux radioactifs dans le domaine public à ARLIT et AKOKAN (Niger), à proximité des mines SOMAÏR et COMINAK (AREVA), CRIIRAD, 14 May 2007.
[2] Greenpeace Briefing Nov 2009, http://www.greenpeace.org/raw/content/international/press/reports/briefing-radioactivity-in-ak.pdf
[3] “Correspondance en date du 6 octobre 2008 avec les Service Départemental des Mines sur le contrôle radiologique de la zone urbaine accompagnée d’une carte des travaux effectuées”, document provided by Areva, 4 November 2009.

Source: Greenpeace International, Press Release, 26 November 2009
Contact: Rianne Teule, Greenpeace International, Ottho Heldringstraat 5, 1066 AZ Amsterdam, The Netherlands 
Tel: +31 650 640 961, Email: rianne.teule@greenpeace.org, Web: www.greenpeace.org

The AREVA half-year results exhibit the financial risks of nuclear power, now that new provisions on the Finnish European Pressurised Reactor (EPR) under construction at Olkiluoto virtually wiped out AREVA’s operating profits for this period. AREVA threatens to freeze the Olkiluoto-3 construction works, blaming “TVO’s inappropriate behavior” for the delays and cost overruns. The Finnish utility Teollisuuden Voima Oyj (TVO), insists on its compliance with the contract and expects AREVA to keep the fixed-price, turn-key agreement. Both parties have taken the issue to arbitrary court.

AREVA has taken a €550 million (US$ 800 million) provision in the first half of 2009 for the EPR being built in Finland, causing the company’s operating profit to tumble 97% to €16 million and the net profit with 79% to €161 million. The latest estimate of the Olkiluoto-3 construction costs reached €5.5 billion, more than double the price of €2.5 billion originally offered to Finnish decision-makers. Anne Lauvergeon, AREVA’s CEO, admitted that there could be more provisions to come. The Finnish project is currently three years behind schedule, and it is impossible to determine the final cost at this stage, she said. Still AREVA markets the EPR as ‘a cost-effective reactor’.

AREVA threatens it will only commence the final phases of the EPR construction once TVO has agreed upon proposals or contractual modifications. AREVA’s language is strong: TVO is accused of inappropriate behaviour in contract management, of not implementing agreed measures for speeding up the work, and of persisting with conduct that is not in line with standard industry practises. Delays are caused by “inadequate resources deployed by TVO” and TVO not “respecting the deadlines for processing the documents that have been delivered (2 months, versus 11 months in practice)”.

AREVA says TVO has changed its demands on the project and is to blame for long delays in the approvals and safety authorisation processes. AREVA currently demands €1 billion compensation from TVO, claiming there is more to come. TVO in turn still concerns Olkiluoto-3 as a fixed-price delivery and claims compensation from AREVA for losses and costs incurred as a result of repeated delays. This internal nuclear fight should act as a warning for potential investors, because it demonstrates that nuclear companies have no intention whatsoever to bear the risk of delays and cost overruns in future reactor projects.

The work continues
So far, the work at Olkiluoto-3 still continues. On 6 September 2009, the dome of the reactor building was installed, representing a major milestone in the EPR construction. The steel dome, weighing 210 tons and measuring almost 47 meters across, will be welded around its circumference and covered with 7,000 tons of concrete.

AREVA also reported that the construction of the EPR in Flamanville, France, is now 65% complete, and Taishan 1 and 2 in China are 30% completed. However, Reuters recently reported that the start of construction work at AREVA’s first nuclear reactor in China was delayed from August to around mid-September because of bad weather. The Chinese authorities still needed to authorise the start of the work, but were busy due to bad weather conditions. Construction works for the Taishan-2 reactor in China are expected to start in March 2010, and the Taishan reactors are expected to come online in 2013 and 2014 respectively.

EDF said in a statement end of July that it still expects Flamanville-3 to be connected to the grid in 2012. It claims that the problems in digging the seaside discharge channel are now overcome, but that remains to be seen. EDF is putting a lot of money and effort in the construction project, supposedly trying to be the first to finish an EPR (before AREVA in Finland). There are 1,800 workers on the construction site and work is being conducted around the clock to make up for past delays.

In the meantime, Anne Lauvergeon made some astonishing remarks about the EPR at a hearing in front of a parliament committee. She described the EPR as “a box of steel and concrete producing 1.650 MW in a very small volume. (…) It resists almost everything. Whatever happens on the outside, there will be no impact on the inside, even on the impact of a commercial plane or missile. (…) The only thing it can not resist is a nuclear bomb."

Raising cash
On 30 June 2009, AREVA announced plans to raise funds for new nuclear investments by selling its transmission and distribution (T&D) unit and by opening up its capital to strategic and industrial partners. AREVA needs the money not only for its ambitious expansion plans, but also to buy out Siemens, who announced in January 2009 it wants to withdraw from the joint venture with AREVA in AREVA-NP (see Nuclear Monitor 683, 12 February 2009: 'Siemens leaving Areva; joining Rosatom?') The French government, 91% owner of Areva, was forced to take action and has been pushing for sales of the T&D unit. CEO Anne Lauvergeon long resisted the sales because the T&D division is a profitable part of AREVA representing 36% of Areva’s turnover in 2007; but Lauvergeon had to give in.

Three consortia made a bid for AREVA’s T&D unit: GeneralElectric with private equity group CVC; Toshiba of Japan; and a French partnership of the turbine group Alstom and Schneider Electric (in 2004 Areva took over the T&D business from the French company Alstom). Toshiba appears to be the least serious, leaving the GE and the French bids on the table as most promising. A decision on the T&D bidding is not expected before beginning of November 2009.

On 11 September AREVA succeeded in raising a large amount of investment money by issueing a €2.250 billion bond. There was (surprisingly?) high interest from investors in the company’s first bond issue, and there might be more to follow.

Corporate bonds seem to be in fashion in the nuclear industry: EDF has raised about €3.2 billion with a public bond issue this summer, aimed to pay for massive investments in its domestic electricity production and electricity network. Also the Finnish utility TVO issued a bond (€750 million), the money to be used for “refinancing and general corporate operations”. It was not specified whether any of the money will be used to cover the Olkiluoto-3 cost overruns. Furthermore, the Italian company ENEL announced a bond issue this autumn to raise money for its investment programme. One of the projects to receive financing from this bond issue is the Mochovce 3,4 nuclear reactor programme.

Sources: Nuclear News Flashes 18 June 2009 / AFP 9 July 2009 / Nuclear News Flashes 30 July 2009 / Financial Times 31 August 2009 / AREVA Press Release 31 August 2009 / World Nuclear News 1 September 2009 / Reuters 2 September 2009 / AREVA Press Release 6 September 2009 / AFP 17 September 2009 / Financial Times 21 September 2009
Contact: Rianne Teule, Nuclear campaigner, Greenpeace International. Ottho Heldringstraat 5, 1066 AZ Amsterdam, The Netherlands.
Tel: +31 – 207 18 2229
Email: rianne.teule@greenpeace.org
Web: www.greenpeace.org

A new report from the Public Services International Research Unit at the University of Greenwich casts doubt on the ability of the nuclear industry to deliver its promised new reactors. The report "Areva and EDF: Business prospects and risks in nuclear energy", published on June 16, is written by Professor of Energy Policy Steve Thomas and commissioned by Greenpeace International. It examines the financial situations of EDF and Areva and, in particular, what the impact of problems at the Olkiluoto (Finland) and Flamanville (France) nuclear construction sites will be on these companies and their shareholders. It looks at how dependent these companies are on the achievement of their objective to obtain orders for at least 35 more EPRs in the next decade and it examines what part these companies will have in financing these orders.

The ownership of both companies is dominated by the French government and the government has consistently used its ownership of these companies as an arm of government policy. For example in the 1970s and 1980s, EDF and Areva’s predecessor, Framatome, was given whatever resources and backing needed to carry through the government’s nuclear ambitions. The French government continues to use these companies as a policy instrument and is therefore unlikely to want to lose control of these companies. While there is a likelihood that the French government will sell some more EDF shares and that private capital will come into Areva, for example through Bouygues, ownership is likely to continue to be dominated by the French government. For the foreseeable future, the shareholders of the two companies will essentially be the French government, especially after the withdrawal of Siemens from Areva NP. The withdrawal of Siemens from Areva NP, apparently because it was unable to influence Areva NP’s policies sufficiently, will also remove a potential obstacle to the French government influencing Areva’s policies to meet its own priorities. However, the withdrawal of Siemens from Areva NP does present financial problems because of the need to find the capital to buy Siemens out. It remains to be seen whether it will lose significant technical expertise and how quickly Siemens can emerge as a major competitor in nuclear markets.

Government ownership is a strength and a weakness to both companies. It gives both companies huge financial strength and strategic backing in world markets, for example through loan guarantees for exports orders. However, the French government’s policy objectives might not always align with the corporate interests of the two companies. For example, the French government could impose restructuring on Areva, such as privatisation, merger with Alstom or a partnership with Bouygues, which are not in Areva’s own interests.

The French market for Areva and EDF
Any plausible cost overruns at Flamanville, which will represent less than 2% of EDF’s generating capacity in France, can probably easily be absorbed, while the output is not needed to meet French demand so construction time overrun will also have little impact. However, it seems implausible that the European Commission will allow EDF to continue to have a de facto monopoly in the French electricity market and at least one major competitor, probably GDF Suez, is likely to be given or allowed to take a significant proportion of the market. What this will mean for the existing nuclear plants is far from clear. Transferring a proportion of them to a competitor would be highly contentious and would be fiercely resisted, but even if EDF retains these, it seems likely that EDF’s ability to use its French customer base to underwrite foreign investments will be reduced. The proposal to extend the lives of the existing plants to 60 years probably makes economic sense to EDF. However, if the plants were kept in operation for an additional 20 years, the market for EPRs in France would be very small and it would make it hard for EDF to retain its capabilities as a nuclear plant designer and engineer.

For Areva, it will be difficult for any competitors to make any impression on the French market share but even the threat of limited competition could erode Areva’s profit margins.

The company’s reprocessing business is likely to shrink unless the trend to plan to dispose of spent fuel directly is reversed. EDF will be reluctant to reprocess its spent fuel if, as seems likely, direct disposal is cheaper. EDF’s proposal to extend the lives of its existing plants to 60 years means that the huge replacement market for reactors in France that Areva was expecting would dominate its EPR sales is effectively indefinitely postponed and its future reactor sales can only be a small proportion of those previously expected.

Foreign markets
EDF has adopted a new policy in the last year of investing heavily in electric utilities in markets where it hopes to build and operate EPRs and it has announced it expects to invest up to €50 billion (US$ 70 billion) in new nuclear power plants worldwide by 2020. In the UK and the USA, EDF has bought existing nuclear power plants as well as planning to build new ones. It has bought British Energy for about €15 billion, 49.9% of Constellation’s nuclear assets for about €6bn (USA). Its British Energy and Constellation investments have been criticised for being overpriced.

Losses with existing plants can mount up very fast, as was illustrated in the UK in 2002 when British Energy collapsed alarmingly quickly because the cost of its power fell marginally below the market price. If the nuclear markets in USA and UK do not materialise, EDF could be left with some very expensive assets of limited value. For China, EDF has taken a minority stake in a company building new nuclear plants, while its role in South Africa, if any, is not yet clear. If the projected sales of EPRs other than those in USA and the UK do not materialise, the impact on EDF will probably not be major. It would have acquired the resources it would need to fulfil these plans and if the plans do not materialise, it will simply not acquire these resources.

Areva is also investing heavily in foreign markets, especially the USA, where it is expecting to build major new facilities. For future reactor sales, Areva NP is heavily committed to just one reactor design, the EPR, with its other options a long way from commercial application. Its projections of reactor sales do not seem realistic and if the manufacturing facilities it is building are left under-utilised, this could be costly to them. If the EPR continues to encounter technical problems or if the US (or UK) safety regulatory processes throw up significant issues, Areva NP will have serious problems remaining a credible reactor vendor, especially after its errors with its previous design, the N4. Unless it can salvage the Olkiluoto project, which is three years late and at least 50% over-budget, very quickly, the damage to its reputation will be severe. Prospective customers will hardly be impressed by a vendor locked in a bitter struggle with one of its customers, appearing to try to renege on a turnkey contract.

Finance, debt and credit ratings
Both EDF and Areva have long had a stream of secure business with limited competition that dominates their financial position. In the case of EDF, it is the French electricity market, where it has an effective monopoly over most sectors of the market. For Areva, there are its reactor servicing and fuel supply businesses especially in France where it has had a market for the 58 operating reactors with little realistic competition. These large, relatively secure markets are on such a scale that the losses even from major failures such as the Olkiluoto project and perhaps the Flamanville project can be absorbed over 3 or 4 years with relatively little impact on their overall profits. They have also allowed the companies to take on relatively risky investments, such as EDF’s investments in South America secure in the knowledge that these would be underwritten by their core businesses. However, both companies appear to be moving in to a period where these secure businesses will become more risky. This comes at a time when their strategic plans call for major investments, which will tend to significantly increase their debt levels, perhaps putting their high credit rating at risk. Both companies have said they want to sell existing businesses to keep their indebtedness under control, but whether they can find businesses to sell that will not damage their corporate prospects and will raise enough money to achieve this remains to be seen. A weakening of their credit rating will have consequences that will be felt throughout their businesses.

Source: "Areva and EDF: Business prospects and risks in nuclear energy." Steve Thomas. Professor of Energy Policy. Public Services International Research Unit (PSIRU). Business School, University of Greenwich, U.K.
The report is commissioned by Greenpeace International and available at: http://www.greenpeace.org.uk/files/pdfs/nuclear/Areva_EDF_Final.pdf
Contact: Greenpeace International, Otto Heldringstraat 5, 1066 AZ Amsterdam, The Netherlands.
Tel: +31-0-207182229

In the face of colossal losses on their EPR construction site in Finland, facing a two billion Euro invoice from the departure of Siemens from the project, some unwise investments in America, 60% fall in share prices over the last few months, Areva is staring down the barrel of business failure. The French nuclear industry is a disaster area, and public money should not be used to prop it up, but to develop renewable energies.

Nuclear company Areva is due to publish its 2008 end of year accounts any day. We already know though that this so-called “beacon” of French industry is on the verge of collapse and waiting once again for a hand-out from the French public to keep their failing nuclear industry alive. Areva is looking for a 3 billion Euro bail out just to balance its 2009 budget, and has already cancelled, on November 25, 2008, a planned uranium-mining project in Canada.

And another big setback for Areva, who were expecting such big things from this market: on December 5th South Africa cancelled its order for 12 nuclear power stations it had hoped to build.

While all this has been going on, the EPR site in Finland, started in February 2005, is rapidly turning into another catastrophe: already 38 months behind schedule, with the Finnish government invoicing Areva for 2.4 billion Euros in penalties for lateness. So, having been invoiced at 3 billion Euros, the real cost of the project is more like 5.4 billion Euros. Barring any other surcharges.

Add to that the departure of Siemens from the project, announced this January, which has hit the company with another bill for 2 billion Euros to buy out their former ally, plus acquire the work they’ve already carried out and are withholding against payment. The Elysée would be by now thinking about letting Middle-Eastern capital into Areva, but this remains very hazardous.

On the Paris Stock Exchange, Areva’s price has slipped from 820 Euros per share last June to 325 Euros by now - a loss of more than 60%!

Additionally, the various reactor construction projects announced over the last few months and representing at least some market optimism for Areva, turn out to be completely “virtual”: on his various foreign trips (Libya, Algeria, Morocco, Abu Dhabi, Saudi Arabia, Jordan, South Africa, Estonia, etc…), President Sarkozy has signed a series of simple “cooperation agreements”, and whilst these make frequent mention of an eventual desire to build EPR reactors, in fact absolutely nothing is definitely signed or sealed.

That led to the Elysée government “bluffing” everyone on February 4 and 24, with their announcements of 2 EPR reactors for India and 4 more for Italy: it’s easy enough to say, much more difficult to do – specially at this time of world economic crisis – to find the kind of money necessary to fund the actual construction.

The other possible market Areva had been eying up but which isn’t looking so good now: the USA. New President Obama’s first announcement committed zero dollars to the nuclear sector… where it had hoped for up to 50 billion. Most reactor projects have been put on hold, and the few that are actually showing signs of life are run by Areva’s big business rival, the American-Japanese consortium of Westinghouse/Toshiba, General Electric/Hitachi.

None of which has stopped Areva investing heavily in America to buy into the supposed nuclear “renaissance” that is looking less and less realistic: in May 2008 Areva announced it was buying into the site at Bonneville, Idaho, to produce nuclear fuel. And in October 2008, Areva announced a 360 million dollar investment in the State of Virginia to produce heavy tolls and machinery for the American nuclear sector.

Areva is also holder of promises of orders from EDF, which bought up British Energy at a top price, just before the economic crunch! But EDF is also heavily in debt and has lost almost 70% of its stock market value by mid-March… Seemingly incapable or recognizing a problem when she sees one, Madame Lauvergeon is sailing on full steam ahead with only one possible outcome, total financial disaster.

But, with Areva being supported by the state, it’s the people of France who’ll be picking up the bill when the time comes. There’s still time to stop the whole mad affair, to stop President Sarkozy from using public money to keep Areva afloat. He should follow the excellent example of President Obama in America, investing in energy economy and renewables.

Source and contact: Sortir du Nucleaire, French Network for Nuclear Phase out. Charlotte Mijeon, International Relations Representative.
Email: charlotte.mijeon@sortirdunucleaire.fr
Tel: +33 675 362 020
Web: www.sortirdunucleaire.fr

Areva: Siemens-Rosatom breach of non-compete clause. Areva has warned Siemens, that the latter’s' plan to create a nuclear joint venture with Russian Rosatom, are a breach of Siemens' contract with Areva. Siemens has a 34% share in Areva NP and under a shareholder agreement from January 2001 entered into obligations including a non-compete clause, Areva said in a statement on March 4, one day after Siemens announced a nuclear joint venture with Russian State Atomic Energy Corporation, or Rosatom. (See Nuclear Monitor 683: “Siemens leaving Areva; joining Rosatom?”)

Under the shareholders' agreement, Siemens is not allowed to compete in activities it brought to Areva NP for a period of eight years. That includes nuclear reactor design and engineering, turnkey nuclear power plant construction, fuel design and manufacture, services, and safety-related instrumentation and control systems. Siemens said it could, however, market turbines, generators and electrical systems for nuclear power plants since Areva NP does not produce those items.

Platts, 4 March 2009

Limitations to Rosatom-Siemens joint venture. A few days after Munich-based Siemens launched the joint venture with Rosatom, forecasting the construction of some 400 new nuclear power plants worldwide by 2030, German magazine Der Spiegel wrote Siemens has to limit its high expectations. Siemens-insiders claim there is a clause in the Rosatom-Siemens agreement that excludes political unstable regions (“politisch unsicheren Regionen”) from the Joint Venture. Siemens seems to be particular cautious not to get involved again in the Bushehr nuclear reactor in Iran. The German company started the construction of the reactor-project more than three decades ago.

Der Spiegel online, 6 March 2009

About 1.8 tons of plutonium in Mixed-Oxide (MOX) fuel, enough to make 225 nuclear weapons, left the French port of Cherbourg on March 5, to travel to Japan via the Cape of Good Hope and the southwest Pacific Ocean. It is due to arrive in Japanese waters by late-May, according to Areva. This shipment represents an immediate risk of contamination to coastal communities along the route should anything go wrong. The shipment is vulnerable to accident and terrorist attack and stands as a reminder to all governments along the route of the unacceptable risks nuclear energy poses to the world.

The dangerous transport is another attempt of the dying industry to survive. As the French nuclear industry and President Sarkozy aggressively try to sell the European Pressurised Reactor (EPR), the latest in nuclear reactors, under the false premise of a climate change solution, they conveniently ignore the very real dangers associated with it, including health risks and potential terrorist attack. EPR reactors are meant to run on 50-100% MOX fuel.

Japan has been trying to use MOX in their nuclear reactors for more than ten years; and have repeatedly failed.  The first shipment to Japan in 1999 ended in fiasco after the producer, UK state company British Nuclear Fuels, admitted it had deliberately falsified vital quality control safety data. After an 18,000-mile voyage, the rejected fuel was shipped back to the UK. Two more cargoes, one delivered in 1999, the other in 2001, were opposed by local citizens and regional governments. Both shipments remain in storage with no prospect that they will ever be used.

There is plenty of evidence showing that the containers used to transport the MOX are not strong enough to withstand serious accidents or terrorist attack. Risk of fire is just one example, the containers are only tested over a few hours, but fires on board ships can last much longer (days or even weeks). Once MOX fuel disperses it poses a grave threat to public health and the environment.

Referring to a plutonium shipment in 2002, the Government of Antigua and Barbuda stated "our small states are fearful that a deliberate act of terror aimed at those ships may bring an end to our very existence. This is not fanciful or farfetched fiction."
Considering all this, it is little wonder that plutonium and MOX shipments have been opposed by dozens of governments and their citizens, since they started.

Areva denying proliferation risks

On the anniversary of the Nuclear Non-Proliferation Treaty (NPT) entering into force, the trade in nuclear bomb grade material between France and Japan seriously jeopardises the international non-proliferation regime. As a result of civil nuclear programmes, the world now has more weapons usable plutonium in so-called commercial use than in all nuclear weapons arsenals put together.

In an March 2, open letter to Mohamed ElBaradei, Director General of the IAEA, Greenpeace states:

Our specific concerns are Areva’s misrepresentation of the proliferation threat posed bycommercial plutonium contained in this and other MOX fuel. They appear dangerously confused or deliberately denying the inherent proliferation risks of the Japanese plutonium MOX fuel. Specifically Areva (Henri Jacques Neau, Director of Transport) went on record March 1 saying: “It is impossible to make a nuclear weapon as suggested by Greenpeace. Here you must be clear, this MOX does not have any interest for any people to make a nuclear weapon from it. There is no interest in the diversion of this material. We have this level of protection, because the MOX fuel contains plutonium. Everything that contains plutonium must have a protective measure,”

Late February following an interview with French news agency, AFP, an industrial source (most likely Areva) was cited in the article stating that, "To make a bomb” out of MOX, “you would first need an installation in order to separate the plutonium from the uranium. And still, the result would only be plutonium of "civil" quality and not military quality," affirmed this source.

These statements are clearly misleading, stating as it does there is a distinction between civil and military grade plutonium. This, as you are aware is not the formal position of the IAEA, which classifies commercial plutonium MOX fuel as Category 1 nuclear material, requiring the highest level of security protection. As the IAEA safeguards glossary states, conversion of MOX fuel or powder to finished plutonium (metal) is of the order of 1-3 weeks.

Greenpeace is long used to Japanese nuclear industry denials that reactor-grade plutonium is a proliferation threat, and that it cannot be used to make nuclear weapons. However, you will be aware that as long ago as 1990 your predecessor Hans Blix confirmed to the Nuclear Control Institute that the IAEA does not dispute that reactor-grade plutonium can be used to manufacture nuclear weapons.

Now we have denials by the nuclear industry including an explicit denial by Areva, which we believe is in defiance of both the IAEA classification of reactor grade plutonium and MOX fuel, as well as senior nuclear weapons scientists and U.S. government departments, including the Department of Energy.

You will be aware that the U.S. Department of Energy first briefed Japan and other states on the proliferation risks from commercial reprocessing, reactor grade plutonium and MOX fuel more than 30 years ago.

Sources: Greenpeace Press release, 6 March 2009 / Letter to ElBaradei, 2 March 2009 which can be found at: www.greenpeace.org/international/press/reports/Open-letter-ElBaradei
Contact: Rianne Teule, Greenpeace International Nuclear Campaigner
Tel:  +31 650 640 961

WESTERN BANKS CONTINUE TO WITHDRAW THEIR INTEREST FROM THE PROJECT

(December 15, 2006) 30 October 2006, the Bulgarian utility NEK announced that a consortium of Russian Atomstroyexport and French / German Areva NP (Areva and Siemens) has won the tender for building the Belene Nuclear Power Station in the north of the country.

(650.5773) WISE Czech Republic - On a press conference a day later, NEK in the presence of Bulgarian Energy and Economy Minister Ovcharov gave further details. Atomstroyexport / Areva NP are to build a completely new AES-92 power station, using two VVER 1000/B466 reactors. The contract price is foreseen to be 3,997 Billion Euro and the reactor should have a 60 year life-time. Atomstroyexport / Areva NP said to be able to construct the first block in 6,5 years after start of construction and deliver the second block a year later. The reactors are according NEK to deliver electricity for 3,7 Euro cent per kWh. Over 200 experts from eight countries were needed to judge the proposals.

The Atomstroyexport consortium won the tender over the Czech Skoda Alliance consortium that budgeted 4,098 Billion Euro for the same configuration. Both Atomstroyexport and Skoda Alliance leader Skoda JS are majority owned by the Russian State and the Russian state company Gazprom, which makes it likely that the offers have been coordinated. Former Kozloduy director and current researcher at the Vienna Institute for Risk Analysis Georgi Kasschiev, who also blew the whistle on the INES 2 incident in the Kozloduy nuclear power plant earlier this year, criticised the choice as binding Bulgaria to nuclear power dependency on Russia. Russian's head of the Federal Agency for Nuclear Power called the choice a "big day for Russia" and he added that "Russia is now returning to the European nuclear power construction market."

New reactors
NEK argued its choice of two completely new reactors over finishing the already existing basis for VVER 1000/320 reactors with a higher chance on acceptance of these new reactors in the European Union. During an intensive information campaign preceding this decision, a coalition of Bulgarian and international NGOs had made clear to the public, interested banks, the EU and the Bulgarian government that the VVER 1000/320 would not be able to receive an operation permit in Germany because of safety concerns. They also had pointed to the bad track record of Skoda Alliance in Temelín in the Czech Republic.

The AES-92 has not been licensed before in Europe. At present Atomstroyexport is constructing an AES-92 power plant in Kudankulam in India, where construction started in 2001 and the first block is supposed to be loaded and become critical in 2007 with the second to follow two years later. The AES-92 is presented by Atomstroyexport as a Third Generation reactor. It is a further development of the VVER 1000/320 model, fitted out with an extra strong containment with stainless steel lining and a core-catcher.

Budget and construction time overdraws to be expected
The total building costs of the Belene NPP have not been made public. The almost 4 Billion Euro contract budget only represents the construction by Atomstroyexport. It does not include preparation costs, infrastructural works and an interim nuclear waste storage to be built on or near the site. Although Atomstroyexport mentioned a construction time of 6,5 to 7,5 years after start of construction, Bulgarian authorities spread the impression that the first block would be able to go on-line in 2013. It is not clear whether still to be expected delays because of a new Environmental Impact Assessment and running court cases started by Bulgarian citizens and environmental organisations are taken into account. Greenpeace and WISE / NIRS consultant Jan Haverkamp expects adaptations of the AES-92 to European standards, as well as the new involvement of Areva NP in the construction to lead to large delays and therefore called the estimated building time of 6,5 years as highly optimistic.

Over 2000 Euro / MW installed
The 4 Billion Euro value of the contract came as a surprise, which even forced Greenpeace and WISE / NIRS to adapt their October 30 comment of the project being "Russian, fast and cheap" after the October 31 press conference to "Russian, slow and expensive". Earlier this year prices were mentioned of around 2,7 Billion Euro with rumours that Atomstroyexport had made an offer for 2 Billion Euros. The reason for this high budget can be found in the choice for completely new reactors. Atomstroyexport is to dismantle the already built parts of two VVER 1000/320 blocks on the Belene site and is allowed to use these parts in Russia as spare parts for reactors there. These parts represent a value of several hundreds of millions of Euros. Taking this into account sees the Belene NPP roughly equalling the investment costs of the Finnish Areva built EPR reactor on well over EUR 2000 / MW installed.

Belene a financial nightmare
Financing the project appears to be a major problem for Bulgaria. After the Bulgarian government announced early October that NEK was going to own Belene for 51%, the financial broker Standard & Poor's directly downrated the company from "developing" to "negative" with Belene as reason. But also banks that had been claimed as interested by Bulgaria's Economy and Energy Minister Rumen Ovcharov withdrew their interest. This includes the Bayerische Landesbank, Commerzbank, Société Génerale / Komercni Banka, KBC / CSOB, Deutsche Bank and UniCredit / HVB / Bank Austria - Creditanstalt. These banks did so after they had been informed by Greenpeace, WISE/NIRS and CEE Bankwatch about the risks involved to the project. Risks mentioned next to financial ones included the fact that the NPP is to be built in a seismic active area, that the EIA - which denies this fact - knows large flaws and is already two years under court procedures, and that it is likely that Belene, once coming on-line, will have to face a highly dynamic saturated market. The banks argued their rejection of the Belene NPP project with economic reasons as well as the fact that the project does not fulfil their strict sustainability criteria. A coalition of NGOs approached UniCredit / HVB / BA-CA on Friday the 13th of October in 23 countries to bring the message across. Pressure on the UniCredit Group continuous to prevent the bank from participating in other future nuclear projects like Mochovce in Slovakia and Cernavoda in Romania.
On the October 31 press conference a group of six more banks, Euratom and the European Investment Bank were mentioned as source of finance. Deutsche Bank a day later confirmed to Greenpeace that it featured falsely in that list and definitely had no interest in the project. The other five banks, Credit Suisse, BNP Paribas, JP Morgan Chase, Merrill Lynch & Co. and the Lehman Brothers Bank were contacted early December by Greenpeace and CEE Bankwatch with information on the risks involved in Belene.

Euratom
The Bulgarian Government made an aggressive publicity run with the claim that Euratom was going to finance 300 Million Euro from the Belene NPP budget. Euratom spokes people denied towards Greenpeace that any application had been received, nor any communication had taken place to this respect. Mark Johnston of the Greenpeace EU Unit: "Someone is lying here."

Russian banks not sufficient
Next to the mentioned banks, the Bulgarian authorities mentioned interest from a Russian pool of banks, including Gasprombank, Sberbank, VTB and Vnesheconombank, with an export guarantee from the Russian state. Observers note, however, that it is likely that this group will not be able to cover the full 4 Billion Euro budget and that Western capital will be needed as well.

Source and contact: Jan Haverkamp, consultant for WISE Czech Republic. Nad Borislavkou 58, CZ - 160 00 Praha 6, Czech Republic.
tel./fax (home): +420.2.3536 1734 / mobile: +420.603 569 243
E-mail: jan.haverkamp@wisebrno.cz

STILL THE SAME OLD SONG: COSTS OVERRUNS AND DELAYS

(December 15, 2006) French nuclear energy giant Areva will take a charge of 500 million euro this year for extra costs because work on the 1600MW Olkiluoto-3 reactor in Finland is 18 months behind schedule, Les Echos reported, without naming its source. The reactor was initially due to be operational in mid-2009. Construction began in August 2005.

(650.5768) WISE Amsterdam - Finnish energy company TVO announced early December that construction of the world's first third-generation nuclear reactor is now 18 months behind schedule. 'The difficulties met since the start of work are not surprising. It is not a bag of chips that we are constructing in Finland but a nuclear reactor, which, what's more, is the first of its kind,' according to an Areva spokesman Construction of the EPR (European pressurised water reactor) began in August 2005 and the reactor was initially due to be operational in mid-2009. 'Today's estimate is that the unit will be completed at the turn of 2010-2011,' the head of the project Martin Landtman said in a statement. "The initial calendar was perhaps too ambitious", the business daily cited an Areva spokesman as saying. "Despite the 18 months delay, construction of the Finnish EPR will not take any longer than usual nuclear sites. We tend to forget, but Chooz, the last reactor completed in France, by EDF, went into service four years later than envisaged," (well, then you should be able to take that in account by now, shouldn't you?). According to Nucleonics Week, industry sources said the contractual penalty for Areva is 0.2% per week of delay past the May 1, 2009 commercial operation target for the first 26 weeks, and 0.1% beyond that. The contract limits the penalty to 10% of the total contract value, or about Euro 300 million, these sources said.

A consortium comprising Areva and Siemens AG is building the 3.2 billion Euro reactor. Areva admitted in July that the problems at the Olkiluoto 3 site will have a major impact on the company's full year results. The company announced massive loss in their profits for the first half of 2006. Income from nuclear operations fell from 373 million Euros to 73 million Euros, due to the contract for the Finnish reactor.
In June, only one year after the start of the construction, the project ran into delays of at least a year, equating to one-month delay for every month of construction. On top of that, the Finnish regulator admitted major problems in the quality control, raising safety concerns.

"The Finnish nuclear reactor was heralded as the start of a European nuclear 'renaissance' and has swiftly become the nightmare for the nuclear industry Greenpeace predicted," Jan Vande Putte of Greenpeace International. Said in July when the Areva publicised it's loss. "The reality is that the nuclear industry is in a deep crisis." "Nuclear power is not only highly dangerous, polluting and proliferating nuclear weapons," Vande Putte said, "but it is also incapable of delivering its promises to the energy market. It is however the champion in sucking up vast financial resources, which would be better used if invested in renewable energy and energy efficiency. The climate cannot afford such nuclear adventures any more."

To add to the problems, the European Commission (EC) late October launched a formal investigation to establish whether the French government's EUR570 million (US$725 million) loan guarantee financing TVO's Olkiluoto-3 reactor complies with EU rules on state aid. The loan agreement to TVO is for the purchase of equipment from Areva. Separate complaints were filed in late 2004 by Greenpeace and the European Renewable Energies Federation (EREF). Both organizations claim the loan guarantee unfairly subsidizes the project. TVO Finance Director Lauri Piekkari said the guarantee is a normal way of financing export projects and that such financing is covered by specific OECD regulations.

There is a lot to say about the claim of the nuclear industry ("Olkiluoto-3 has proven that nuclear is cheap even without government subsidies") but not that it is the truth. The tough competition between the manufacturers lowered the price of the whole project down.

Olkiluoto-3 is a crucial deal for its constructor, Framatome ANP. It is the first EPR design ever being built and a first nuclear project in a western country in a decade. Therefore the company was ready to dump the price - after securing € 575 (other sources claim even 610 million) COFACE export credits from the French government.
The agreement to construct the reactor was made for a fixed price of 3,2 billion Euro. Even this exceeded the maximal cost estimations used during the political debate by 700 million Euro. Already in 2004 there were signs indicating that the total costs would be exceeded significantly. The constructor Framatome ANP took all the risk by agreeing on a fixed price contract, which means that there's no financial risk on TVO if the project fails. This enabled TVO to get a very cheap Euro 1,95 billion loan with only 2,6 percent interest rate. TVO is a consortium of forest industry and public energy companies. TVO produces electricity for its shareholders and doesn't sell any electricity directly. The shareholders will get electricity according to their shares for the price of the production - meaning that TVO itself as a company isn't aiming for making profit. This also means that the electricity is priced based on production costs only

Sources: AFX News Limited, 5 December 2006 / Nucleonics Week, 2 November 2006 / WNA News Briefing 06.43, 25-31 October 2006 / Greenpeace International Press release, 27 September 2006 / Greenpeace Briefing, 15 October 2006 / www.olkiluoto.info
Contact: Kaisa Kosonen, Energy campaigner at Greenpeace Finland, Aurorankatu 11 a 2, 00100 Helsinki, Finland
Tel: +358 9 43157135; Fax: +358 9 43157137
Email: kaisa.kosonen@nordic.greenpeace.org
Web: www.greenpeace.fi