Kiev invitation for R4/K2 contractors

30 April 1998

Energoatom has launched a bid pre-qualification invitation for companies interested in completing two unfinished nuclear power plants – unit 4 at Rovno and unit 2 at Khmelnitsky. The Invitation for Pre-qualification of a General Contractor follows publication last November of the General Procurement Notice for the project. Pre-qualification and tendering for the general contract is open to firms and joint ventures from any country. Contract award is scheduled for December (see Tenders, page 5).

Energoatom has applied for loans from Euratom and the EBRD to help finance the final stages of construction of the two units, which are estimated to be about 85% complete. It says completion will cost about $1.2 billion, with the general contract accounting for most of that total. The contract may be co-financed by Euratom, the EBRD and the Export Credit Agency (ECA), under the EBRD’s Export Credit Loan Arrangement Technique (ECLAT).

However, in February, EBRD acting president Charles Frank said in Kiev that the bank was unsure about lending money for the construction of nuclear reactors. He said even if the $1.2 billion loan were granted, it would not be possible to construct the new reactors by 2000, the year by which the Ukrainian government has pledged to close down Chernobyl. Frank said the EBRD wants to ensure that the decision to build the two new reactors is cost-effective, that a safe design is used, and that the loan would be repaid.

Russia seems willing to step into the breach. On 3 March the Ukrainian government announ-ced that Russia will provide the equivalent of $180 million towards completion of the two units involving several hundred tonnes of pipes and other related equipment. Ukraine is to repay the loan over 10 years through joint sales of electricity generated by the two reactors. It remains to be seen how this will affect the tenders.

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