Czechs reach for a major project. They hope to be awarded to complete two nuclear reactors in Ukraine.

12. 11. 2020

Source: Hospodářské noviny, 4. 11. 2020, Petr Lukáč

The engineering company ŠKODA JS from Plzeň, Czech Republic, reaches for a project which could bring it a lucrative business for quite a long period of time. Together with the Ukrainian operator of nuclear power plants, Energoatom, they started working on a completion project concerning two power units of the Khmelnitskyi power plant. The business could be worth tens of billions of Czech crowns, with other jobs consequently being available for other Czech firms.

“We are leading very intensive negotiations in Ukraine,” František Krček, GM of the Plzeň company, said in an interview for HN. “We are now in the phase of starting assessing the condition of the equipment already supplied there before abandoning the project in 1991,” he added, saying that Škoda could be the general contractor of the nuclear island equipment.

The power plant is located in the Khmelnitskyi Province in Western Ukraine. Construction of the first reactor was started in 1981, and it lasted six years. The original plan was to erect four power units there, but the works were stopped with the breakup of the Soviet Union. The second reactor was completed with a great delay and commissioned in 2004. The remaining two still await completion.

“The project was stopped at the moment of 60-70 percent being constructed of the third unit and about 20 percent of the fourth one. Now, the assumption is to complete the third unit and to see whether the fourth one would pay off,” describes František Krček the status of the negotiations.

As the total workload still remains unclear, the ŠKODA JS’s GM is reluctant to specify the size of the order to be awarded to the Czech firm. “We will be able to enumerate our part when the equipment condition is assessed. Right now, it would be mere speculations. The sum of the potential contract will be based on our establishment of the condition of the equipment and documentation and on what can be reused and what not.”

Attempt No. 2

The completion project for the third and fourth reactors in the Khmelnitskyi NPP is not being considered for the first time. The Ukrainian government already contemplated to start it up several years ago. But at that time, immediately after the Russian invasion of Crimea and during the civil war, it was not able to secure the funds needed. The costs of the whole project were estimated to reach an equivalent of sixty billion Czech crowns.

At that time, ÚJV Řež of the ČEZ Group collaborated on the preparatory works. “In May 2016, together with
ŠKODA JS, we won a tender for finishing the technical-economic study of the completion project,” says ÚJV’s GM Daniel Jiřička. “Our finished study was even approved by the Ukrainian Parliament. At present, the completion project has been assigned to the local state enterprise Energoatom as a task of high priority,” he adds.

Even if the firms have already been invited to work on the completion project, they still cannot take anything for granted. “There is nothing for sure until you have signed a contract. But there is a strong will on both sides to make a deal. At first, we have to agree on funding, contracts, guaranties … we are really still at the beginning. We were contacted in the middle of September,” Krček said.

It has to be added that the works of the company in Ukraine not always went without issues. For six years now, there are investigations pending as to alleged corruption and bribery involving a member of the local parliament. The case is still investigated by the police and courts. According to the GM of the company, this all concerns private persons; the company itself has never been accused and its name is still perceived well. “If this case damaged us, they would not contact us with other orders,” he says.

Substitute for Temelín

For ŠKODA JS, the project would mean not only a big job but also one which would help it ensure continuity in the construction of extensive facilities. Currently, the company is finishing works on the power units of the Mochovce Nuclear Power Plant in Slovakia, the construction of which were also started as far back as during the communist era.

Bratislava decided to renew the completion project in 2008, and the power units had to be finished in 2012 and 2013 respectively. But the project is facing a big delay and costs x-times more than planned. The blame for the problems in construction, chaos on the site and bad work organization is mostly thrown on the Italian company Enel, which never had any experience with nuclear power units.

But not even ŠKODA JS was spared issues as the local police started investigating the company this year on its site in Slovakia, accusing the company that some pipes supplied to Mochovce did not meet the required technical parameters. “But we have analysed the materials, with the results being that not a single metre of pipeline had to be replaced at Unit 3,” Krček maintains.

If everything goes well now, electricity production could be started next year in Mochovce. Which means that Škoda has to look around for a new big project. “If the tender for the Temelín Units 3 and 4 took place, we would probably change over to it from the Mochovce completion project smoothly. But the tender was cancelled and even though the Dukovany project is being started now, there has been a long break. It could be filled up now by works on the Khmelnitskyi power plant completion project. It would be a great pity if our team of 250 highly qualified people we have in Slovakia would scatter,” Krček said.

The project can also be important similarly for other Czech firms which supply equipment for the Russian VVER technology installed in the Mochovce NPP, Khmelnitskyi NPP and in all six power units operated in the Czech Republic in Dukovany and Temelín. The firms include the already mentioned ÚJV Řež, Sigma from Olomouc producing pumps, supplier of control systems ZAT, and other companies.

Last Chance

Every job order is crucial for the Czech nuclear industry. Many firms were hit hard by the cancellation of the Temelín tender in 2014 as virtually the whole power engineering sector and a number of construction firms were to take part in the project. Many of them have not survived since then: ČKD, Vítkovice Group from Ostrava, or Modřany Power.

Other companies today pin their hopes on the plans of construction of a fifth power unit in the Dukovany NPP. After many years of postponing the whole issue, the government and ČEZ agreed this year on a system of funding the project for more than 200 billion crowns. They should start selecting the contractor this year and the construction could be started in 2029.

“We have the last chance to stimulate the sector. If the new nuclear source project is stopped again, in 15 years, I’m afraid, we might not be able to find the human capacities we need,” says ŠKODA JS’s GM František Krček.

Source: Hospodářské noviny, 4. 11. 2020, Petr Lukáč