January 10, 2017 / 9:40 AM / a year ago

Finnish retailer Kesko allowed to exit nuclear project

HELSINKI, Jan 10 (Reuters) - Finnish retailer Kesko Oyj is allowed to walk away from the Fennovoima nuclear project, an arbitration court ruled on Tuesday.

Kesko, which owned about 2 percent of Fennovoima at the time, said in 2014 it wanted out of the project, but Fennovoima’s Finnish owners said Kesko had committed to further financing for the 6-7 billion euro ($6.4-7.4 billion) plant.

Finland’s court of arbitration dismissed that claim on Tuesday.

“This is the end of the case. We are happy with the decision,” Kesko spokesman Lauri Peltola said.

Fennovoima declined to comment and its Finnish owners’ consortium, Voimaosakeyhtio SF, was not available for immediate comment.

The project has seen several of its original investors opt out, including Germany’s E.ON.

Russian state-owned nuclear company Rosatom agreed in 2013 to take a large stake in the project, and to supply the reactor.

Facing concerns about an increase in Russia’s influence on Finland’s energy sector, however, the Finnish government then set a requirement for 60 percent local ownership in the project.

That threshold seemed out of reach and the project was close to collapse in 2015 before Finnish utility Fortum signed up.

Prior to the arbitration ruling, the project was 66-percent owned by Voimaosakeyhtio SF, which includes Finnish utilities and industrial companies, while Rosatom held 34 percent, Fennovoima’s website showed.

The reactor is due to come on stream in 2024.

$1 = 0.9427 euros Reporting by Jussi Rosendahl; editing by Jason Neely

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