Power Group Online Article |  | |
14 July 2006 - In response to speculation concerning delays in the construction of Finland's new nuclear reactor the Areva-Siemens consortium charged with building the Olkiluoto 3 plant has issued a statement explaining that teething problems with new technology are resulting in some delays and admitting that this will have an impact on operating income.
The nuclear power plant and its customer TVO have made a joint assessment of the
state of progress of the project. The consortium now forecasts that the new plant will be commissioned during the 2nd quarter of 2010, with electricity being generated for the first time at the end of 2009.
The Olkiluoto 3 EPR is the world's first Generation 3 reactor. It includes numerous innovative features based on operating feedback from the 98 nuclear reactors built by Areva and has benefited from major research and development programs. It is currently the most advanced reactor in terms of competitiveness, safety and environmental protection.
The consortium said that, considering the scale of this first-of-a-kind project, the problems that have lead to the delays are nothing unusual.
The issues include:
- the need to produce, examine and approve solutions in the areas of project
engineering, manufacture and construction while the work is being carried
out,
- the time taken for the pool of sub-contractors to achieve the level of
performance required for the new generation of nuclear power plants,
- and the problems with concrete production encountered on the site.
In addition, TVO and Areva confirmed that the exceptionally stringent requirements of the Finnish market, one of the most demanding in the world where safety is concerned, are being met in full. For example, the Finnish safety authority carried out a highly detailed investigation into the nuclear island's ability to withstand the impact of a large commercial aircraft. These studies will constitute a unique reference for future EPRs.
The current situation of the contract has been carefully analyzed by Areva and
presented to the group's Audit Committee and Supervisory Board; on the basis of
these findings, provision will be made for potential additional costs that might result from the current situation. Operating income will be much lower in the first half of 2006 than at the same time last year; furthermore, the group will not generate any pre-tax free operating cash flow in the first half of this year. Profit targets for 2006 remain unchanged.
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