Russia signs nuclear deal with Argentina, competing with China

PARIS (Reuters) - Russia signed a new nuclear cooperation agreement with Argentina, which is already negotiating with China about building nuclear reactors.

The logo of Rosatom Corp. is pictured at the World Nuclear Exhibition (WNE), the trade fair event for the global nuclear community in Villepinte near Paris, France, June 26, 2018. REUTERS/Benoit Tessier

State-owned Russian reactor builder Rosatom said in a statement that the two countries had signed a “strategic document” confirming their partnership in nuclear energy at the G20 summit in Buenos Aires at the weekend.

It was signed by Rosatom CEO Alexey Likhachev and Argentina Energy Minister Javier Iguacel at a ceremony attended by Russian President Vladimir Putin and Argentine President Mauricio Macri.

The deal is not a contract to build nuclear reactors, but a framework agreement like ones Russia has signed with many countries.

Such agreements do not always lead to firm contracts and are often reconfirmed every few years. Russia has signed earlier nuclear agreements with Argentina, most recently in 2015.

The latest agreement comes shortly after the head of Argentina’s national investment agency told Reuters last month that Argentina and China aimed to close within days a deal worth up to $8 billion to build a fourth nuclear power plant in Argentina. [nL2N1Y2222]

No announcement about this was made at the G20 summit, although Argentine media reported that talks are continuing.

The South American country already has three reactors - two German-built, one Canadian-built - which together generate about five percent of its electricity and have combined capacity of 1.6 gigawatt (GW), World Nuclear Association data show.

China has already identified a potential site, Atucha, in Buenos Aires province - where two German reactors have been in operation since 1974 and 2014 - and a reactor model, the Chinese-design Hualong.

It was not immediately clear whether a potential Russian reactor would be in addition to the Chinese project, but industry experts say that intensifying talks with a second potential supplier would strengthen Argentina’s hand in negotiations with the Chinese.

Rosatom said the new agreement outlined the development of large and small reactors in Argentina, possible joint projects in third-world countries and the possibility of jointly operating Russian floating nuclear plants.

Following the financial troubles of U.S. reactor builder Westinghouse and French Areva - now part of utility EDF - Rosatom has become the nuclear industry’s undisputed leader, with an export order book worth $133 billion. [nL8N1TY54Z]

At home, China has 45 nuclear reactors in operation and about 15 under construction and it wants to build reactors abroad, but it lags way behind Russia in nuclear export.

China has built four small reactors in Pakistan and is building two Hualong reactors there. It also has an agreement with French EDF to build a Hualong reactor in Britain but no timing has been set and Argentina looks like China’s best chance for a nuclear newbuild deal on another continent.

Additional reporting by Cassandra Garrison in Buenos Aires; Writing by Geert De Clercq; Editing by Adrian Croft