Czech government wants KHNP to guarantee Czech firms’ involvement before Dukovany deal

The Czech government will ask Korean company KHNP, which is expected to build two nuclear reactors at Dukovany, to guarantee that Czech firms will account for at least 30 percent of construction before the final project contract is signed. Overall, the requirement is for Czech industry to be involved in 60 percent of the project. Industry and Trade Minister Lukáš Vlček (STAN) said this at a press conference today.

Vlček made a working visit to South Korea last week. The minister said the main aims of the trip were to discuss further progress in preparing the project and the involvement of Czech industry.

„We wanted KHNP to clearly specify how it would meet its commitment to involve Czech industry in 60 percent of the project overall. We also stressed the requirement for a guarantee covering around 30 percent of this involvement before the contract itself is signed,“ Vlček said.

The government has previously said that ensuring a substantial share for Czech firms is one of the tender’s key elements. KHNP, which was selected as the preferred bidder last year, promised in its bid to involve Czech industry in 60 percent of the project, according to the cabinet. However, this commitment was not part of the tender conditions, as that would conflict with EU rules, Vlček said. Nor will the commitment be included in the construction contract itself. KHNP is currently negotiating it with ČEZ, which is responsible for the tender. The contract is expected to be signed by the end of March.

Representatives of the Association of Construction Entrepreneurs said last week that no binding agreements had yet been reached between Czech firms and the Koreans on participation in the project. The association warned that the previously stated goal of involving Czech industry in 60 percent of construction could therefore be seriously at risk, with the actual participation of Czech firms limited.

Another aim of the talks in Korea, Vlček said, was to secure assurances of support for the Dukovany construction project from Korean politicians. The minister reiterated that the project has the backing of both the current Korean government and the opposition.

The construction of new nuclear units in Czechia is expected 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. 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.