South Korean minister defends Czech Dukovany, KHNP faces criticism over failed talks

South Korea is not backing down in the slightest from its commitment to successfully complete the Dukovany nuclear power plant expansion project. South Korean Minister of Trade, Industry and Energy Kim Jong-kwan wrote this today in a post on social media platform X. He also criticised South Korea’s state-owned energy company KHNP over the collapse of talks on a construction contract for the project to build two new nuclear units at Dukovany.

On Thursday, KHNP announced that unsuccessful negotiations on a construction contract with a consortium of South Korean companies, Daewoo Engineering & Construction and Doosan Enerbility, had ended. KHNP said the two sides had differing positions on key terms and that the company would now consider its next steps.

In his post on X, the South Korean minister said KHNP must demonstrate greater responsibility and leadership. He also urged the company to listen more to its partner companies and actively resolve disagreements.

The construction of new nuclear units in the Czech Republic is expected to be the largest domestic contract ever. At last year’s prices, the cost of building two reactors at Dukovany is 407 billion crowns. According to plans published so far, construction of the first unit was due to begin in 2029, with completion expected in 2036.

Analysts contacted by the Czech News Agency (ČTK) said the collapse of KHNP’s negotiations on a construction contract could complicate matters for the Czech Republic, but does not yet pose an existential threat to the entire project. They said the case mainly shows that it will be difficult to stick to the originally agreed price and schedule. They expect more significant consequences for the South Korean company, but said it is unlikely to withdraw from the project.

“It has a contract worth 407 billion crowns with the Czech investor, extensive preparatory work behind it and strong support from the Korean government. Withdrawing would deal it a huge blow to its reputation and finances and jeopardise its ambitions to establish itself in the European nuclear market,” warned Purple Trading analyst Petr Lajsek.

Electree chief economist Petr Zámečník acknowledged that the failure of the Korean companies to reach an agreement could also complicate matters for the Czech Republic. “If KHNP cannot quickly find a replacement, it will put pressure on the schedule and, in turn, on the cost of the entire project,” Zámečník said.