Rusatom signs contracts for Hanhikivi nuclear plant

2 January 2014

Russia has signed power plant and nuclear fuel supply contracts with Fennovoima for the construction of an AES-2006 nuclear power plant, Hanhikivi-1, in Northern Finland.

A third agreement between Voimaosakeyhtio SF, which owns Fennovoima, and Rusatom Overseas establishes areas of responsibilities and shareholding for the project. It envisages that Rusatom Overseas will acquire a 34% share of Fennovoima at the end of February 2014, around the same time a final investment decision is made on the construction of Hanhikivi-1.

Forty-five of the shareholders in Voimaosakeyhtiö decided to continue in the Hanhikivi project, in November 2013. With Rusatom's shareholding this means that 84% of the energy production from the future nuclear power plant has been reserved. Voimaosakeyhtiö is now carrying out internal ownership rearrangements, and is considering taking on new investors in the project.

Nuclear plant supply contract

A power plant supply contract signed between Fennovoima and Rusatom Overseas on 21 December, envisages first electricity production from Hanhikivi 1 in 2024.

The price of the nuclear power plant was not disclosed. However, Fennovoima said that the cost price of electricity (and the price it will be sold to shareholders) will be less than EUR 50/MWh ($68/MWh) when the plant starts operating in 2024.

This price includes all production costs, depreciations, debt interests as well as waste management, according to Fennovoima.

Rosatom will play 'an important role' in arranging debt financing for the construction phase of the power plant. Fennovoima said.

TVEL wins EUR450 million nuclear fuel contract

Russian nuclear fuel company TVEL and Fennovoima, have also signed a ten-year contract covering nuclear fuel supply, and design, licensing and training services.

The contract, valued at EUR450 million, covers shipment of TVS-2006 nuclear fuel assemblies for the first core, and for ten years of operation. There is also the possibility for renewal, TVEL said.

The TVS-2006 fuel assemblies were developed in 2012 for unit 1 at in Novovoronezh II, which is due to be commissioned in 2014.

Voimaosakeyhtiö CEO Pekka Ottavainen and Rusatom Overseas Director General Dzhomart Aliev sign agreement for Hanhikivi 1 on 21 December 2013 (Source: Fennovoima)

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