Korea clinches W1tr UAE nuclear reactor deal

Korea has reached a landmark deal with the United Arab Emirates to operate four nuclear reactors currently under construction in the Middle East country, officials said Monday.

The state-run Korea Hydro & Nuclear Power said it made an operation support services agreement with the UAE Emirates Nuclear Energy Corp. over operating the four Advanced Power Reactor-1400 nuclear reactors at Barakah. 

The deal is estimated to be worth around 1 trillion won ($880 million), including 680 billion won for the contract fee and 360 billion won for indirect support cost.

From May next year, the Korean company will send about 210 workers there every year until 2030. This is the first time that Korea is sending human resources related to nuclear reactors overseas.

“This may practically be the first time that Korea clinched a business deal of dispatching such large human resources. This will serve as a new chapter in terms of the ties with the Middle East, which have evolved mainly based on the construction businesses since the 1970s,” said KHNP president Cho Seok.

In 2009, the Korean consortium led by state-run Korea Electric Power Corp. won a $20 billion agreement to construct four nuclear power plants in the UAE, marking the country’s first exports of nuclear reactors.

Launched in July 2012, the construction of the first nuclear power plant is scheduled to be completed in May next year. The fourth nuclear power plant will be completed in May 2020.

UAE ENEC will cover all costs, including living expenses for the Korean employees. Each Korean employee will receive on average about 300 million won in yearly wages, it added.

The UAE had initially planned to operate the plants on its own, but sought the deal with Korea, as it could benefit from the country’s human resource and know-how.

As part of moves to carry out the deal, the Korean company has recruited about 750 new employees who are currently under training.

KHNP and UAE ENEC vowed to seek a tighter relationship over nuclear power plant projects.

The UAE is reportedly considering awarding additional orders for four more nuclear power plants.

By Lee Hyun-jeong  (rene@heraldcorp.com)