Fiala: Czech government expects to sign final Dukovany contracts within weeks

The government expects to conclude the final contracts for the construction of new nuclear units at Dukovany within the next few weeks. Prime Minister Petr Fiala (ODS) told journalists today. According to the cabinet, the agreements are almost complete, and the signing is expected to guarantee Czech suppliers a share of around 30 percent of the project. The government will subsequently present a financing model for the new reactors.

New nuclear units at Dukovany are to be built by South Korea’s KHNP, which won the Czech nuclear tender last year. The government preferred its bid over those of EDF and Westinghouse. ČEZ, which is responsible for the tender, is now negotiating the final project contracts with KHNP. Under the original plans, they were to be concluded by the end of March. ČEZ recently acknowledged, however, that their signing would be delayed.

According to Finance Minister Zbyněk Stanjura (ODS), the final Dukovany contracts are now close to being finalized. He noted that the main construction contract runs to several hundred pages, while the technical specifications in its appendices span several thousand more.

One of the main issues behind the delay to the agreements, compared with the original timetable, is the level of involvement of Czech companies in the overall project. The Korean company pledged in the tender to award Czech suppliers a share of up to 60 percent. Company representatives reiterated the same figure recently, but noted that it would only be reached once both reactors had been completed, that is, after 2038.

In recent months, representatives of Czech companies have repeatedly said that the previously promised involvement of Czech industry is at risk because no binding agreements between suppliers and the Koreans have yet been reached. Industry and Trade Minister Lukáš Vlček (STAN) subsequently announced that, before the final project contract is concluded, the Czech government would seek a guarantee from the Korean company that Czech firms would receive a share of at least 30 percent of the construction work. Overall, he said, the requirement remains for Czech industry to be involved in 60 percent of the project. Stanjura confirmed today that the secured share for Czech companies should be close to 30 percent before the contracts are signed.

The government also plans to present a financing model for the new reactors after signing the agreements with KHNP. Stanjura said it had not wanted to make the model public earlier so that ČEZ would not lose a potential advantage in its negotiations with the Koreans.

The construction of new nuclear units in Czechia is set to be the largest domestic contract in the country’s history. At current prices, the cost of the currently preferred plan to build two reactors at Dukovany is 400 billion crowns. The first unit at Dukovany is expected to be completed in 2036. Over the next three to five years, however, ČEZ is also expected to negotiate with the Koreans, under a government decision, an option to build two more units at Temelín.