Ukraine signs deal for two nuclear reactors

KHMELNITSKI, UKRAINE - The Ukraine has signed a 4.1 billion-euro US$4.9 billion deal with Russia to build two nuclear reactors at the Khmelnitski nuclear power plant in western Ukraine.

The agreement was signed by Ukrainian Energy Minister, Yuri Boiko and the head of Russian nuclear company Rosatom Nuclear Energy State Corporation, Sergey Kiriyenko. Russia will loan all the money needed for the design, construction and commissioning of the third and fourth nuclear power units at Khmelnitski. Reports suggest that Russia undercut its rivals by 840 million euros US$1.02 billion.

The project will be handled by AtomStroyExport, a subsidiary of Rosatom. Work had begun on both reactors in the past but was abandoned by the Ukraine due to lack of funds.

The agreement comes days after Moscow signed a deal with the Ukraine to supply all four of Ukraine's nuclear power plants with reactor fuel. The contract will run for 25 years. The Ukraine's four nuclear plants consist of 15 reactors — 13 units with VVER 1000 reactors and two units with newer VVER 440 reactors — and supply about half of the country's electricity.

The plants, which are run by state-owned Energoatom have a total generating capacity of 13,835 megawatts MW. The Ukraine is also home to Europe's largest nuclear power plant at Zaporizhzhya, which has a generating capacity of 6,000 MW. The country's most infamous plant, Chernobyl, was the site of the world's worst nuclear disaster when Unit 4 exploded in 1986, prompting a ban on nuclear power development in most European countries that only now is starting to change.

About 47 of the country's power comes from coal and gas-fired stations, with another 5 from hydro. There is very little renewable power generation in the Ukraine to date.

Last month, Russia's Rosatom agreed to assist Turkey in building and operating its first nuclear power project, consisting of four 1,200-MW VVER reactors at Akkuyu on the Mediterranean coast. The project is expected to cost between $18 billion and $20 billion. Rosatom has until mid-August to establish a Russia-owned subsidiary to manage the project. Russia is expected to retain a majority stake of 51 and offload up to a 49 stake in the subsidiary to Turkish investors.