LONDON (Reuters) - Russia’s Rosatom expects to sell a 49 percent stake in its Turkish nuclear project to a consortium of Turkish companies by the end of the year, and aims to start construction of the Akkuyu plant by the end of March, a company executive said.
Kirill Komarov, Rosatom’s first deputy chief executive for corporate development and international business, said Rosatom was on course to sell the stake in Akkuyu to Turkey’s Cengiz-Kolin-Kalyon consortium after signing a preliminary deal in June.
“We hope to get a Turkish nuclear operating licence at the beginning of next year and start with the first concrete by the end of Q1,” Komarov told Reuters at the World Nuclear Association conference in London.
He added the project continued to get strong support from the Turkish government, which is keen to get it launched as soon as possible.
State-owned Rosatom has been expanding its order book rapidly in recent years, and the $20 billion Akkuyu project in energy-hungry Turkey is one of its largest contracts.
The launch of Akkuyu was complicated by a diplomatic spat between Russia and Turkey over the downing of a Russian military plane near the border with Syria, but earlier this year Rosatom received approval from Turkey’s energy watchdog.
Komarov said under the agreed Build-Own-Operate (BOO) model Turkey would pay Rosatom an average electricity price of 12.35 U.S. cents per kilowatt-hour, not adjusted for inflation, for 15 years.
He said Rosatom would also pay Turkey 20 percent of its profits from the plant once it had recouped its investment.
Komarov said that while the BOO model - under which countries pay Rosatom for electricity rather than buying a plant - is Rosatom’s standard business model for developing countries, it has a range of models on offer.
In South Africa, where Rosatom is one of several nuclear vendors hoping to win a future tender to expand the country’s nuclear capacity, Komarov said Rosatom was willing to consider all business models, including an outright sale.
“It doesn’t matter what type of model is chosen (by the South African government), we are definitely able to participate,” Komarov said.
Rosatom’s growing confidence on the international stage comes at a challenging time for the nuclear industry.
Toshiba-owned U.S. rival Westinghouse filed for Chapter 11 bankruptcy protection earlier this year, while the reactor unit of French competitor Areva is being sold to utility EDF as part of a government-led financial rescue package.
Unlike its two big competitors, Rosatom has announced a string of nuclear deals in recent years, although many of these are preliminary memoranda of understanding (MOU), not firm contracts.
Komarov said these MOUs were not included in Rosatom’s $130 billion foreign order book, which includes only firm contracts with financing already agreed.
“It’s not a story of intention but of execution,” Komarov said, adding he expected Rosatom to sign another firm nuclear contract this year.
Last year, Rosatom earned net profit of $1.4 billion on revenue of $10.4 billion from its civilian nuclear activities.
Komarov denied Russia provided direct financing to Rosatom for its overseas projects, only export credits, which is standard industry practice.
Reporting by Alexander Winning and Geert de Clercq; Editing by David Clarke and Mark Potter
Our Standards: The Thomson Reuters Trust Principles.