April 23, 2012 / 4:15 PM / in 5 years

S.Africa wants nuclear contracts to stay at home

* Foreign firms under pressure to find local partners

* Nuclear power needed for teetering electric grid

By Sherilee Lakmidas

JOHANNESBURG, April 23 (Reuters) - South Africa wants to see its firms eventually being awarded the bulk of the contracts in its $50 billion plan to build six nuclear plants to power Africa’s biggest economy, the head of its electric utility said on Monday.

Firms from France, the United States, Japan, South Korea, China and Russia have been lining up for years for a chance to win the contract, one of the biggest in the world for nuclear power.

Eskom chief executive Brian Dames said while the first of the nuclear power units might only secure 35 percent localised content, the country wants to see that rise to about 70 percent by the time the final plants are built.

“This is a key objective for us,” Dames said at a National Union of Mineworkers nuclear energy seminar.

South Africa, which has the only nuclear plant on the continent, wants to build up the capability of its construction and manufacturing firms through the nuclear contract, putting pressure on foreign builders to procure more from local companies.

“Our view is we should do this in partnership with national players. We don’t have to do this alone but majority ownership should remain in South Africa.”

The energy-hungry country plans to build six new nuclear power plants, providing 9,600 megawatts (MW) of power, or about a quarter of current capacity. The first electricity is expected to come online in 2024.

The country is operating on razor-thin electricity margins and needs the power to grow its energy-intensive mining industry

Potential bidders are likely to include Areva, EDF, Toshiba’s Westinghouse Electric Corp, China Guangdong Nuclear Power Group, South Korea’s Korea Electric Power Corp (KEPCO) and Russia’s Rosatom.

Minister of Energy Dipuo Peters told the same seminar no date had been set for when the bidding process will start.

The international contract will be one of the largest South Africa has offered since a multi-billion arms deal about a decade ago. That deal was mired in criminality with several political heavyweights convicted of receiving bribes.

South Africa is seen as coming to the aid of an ailing nuclear industry battling for new customers after new nuclear reactor builds were all but halted in the wake of Japan’s Fukushima disaster last year. (Writing by Jon Herskovitz; Editing by James Jukwey)

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