Exclusive: Westinghouse discussing group bid for Saudi
nuclear tender - sources
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[November 21, 2017]
By Reem Shamseddine, Stephen Kalin and Geert De Clercq
RIYADH/PARIS (Reuters) - Toshiba-owned
Westinghouse is in talks with other U.S-based companies to form a
consortium to bid in a multi-billion-dollar tender for two nuclear power
reactors in Saudi Arabia, three industry sources said.
Saudi Arabia, the world's top oil producer, sent a request for
information (RFI) to reactor builders worldwide last month in a first
step towards opening a formal tender, Reuters has reported. A nuclear
newcomer, it wants to use atomic power to generate electricity at home
so it can export more crude.
Taking part in the tender would be a major step for reactor builder
Westinghouse after it went into chapter 11 bankruptcy this year.
U.S. utilities also abandoned two half-finished Westinghouse AP1000
reactors at V.C. Summer in the United States. Toshiba, which is looking
for a buyer for Westinghouse, also dropped plans to build Westinghouse
reactors in Britain and India.
If other companies join U.S.-based Westinghouse in a consortium it would
show that they still believe the AP1000 is a viable competitor to
French, Russian, South Korean and Chinese reactor models.
Russian and South Korean companies have already said they plan to bid in
a deal seen as one of the most promising prospects for the global
nuclear industry, which is struggling to find contracts following
Japan's Fukushima disaster in 2011.
A bid would also show that the United States remains a player in the
small club of nuclear reactor builders in an industry which has
important geopolitical and security implications.
One industry source familiar with discussions said Westinghouse and U.S.
utility holding company Exelon were discussing forming a consortium that
could also include other U.S. companies such as industrial contractor
"They are creating a team that could address all the requirements," the
source said, referring to technology, security, construction, fuel and
A second industry source said Westinghouse and Bechtel were working
A third source with knowledge of the bidding process said Westinghouse
is working on a bid for the tender and definitely hopes to take part but
declined to comment on the consortium members.
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The Kingdom Tower stands in the night in Riyadh in a file photo.
Spokespeople for Westinghouse and Exelon did not immediately respond to a
request for comment and declined to comment for Bechtel.
A fourth industry source in contact with both the Saudi and U.S. sides said
there would be a bid by multiple U.S. companies, without naming them.
The source said companies have until late December to respond to the RFI and
that the U.S. group is exploring the possibility of Export-Import Bank financing
and bank financing.
A spokesman for the King Abdullah City for Atomic and Renewable Energy (KACARE),
the Saudi government agency tasked with the nuclear program, did not immediately
respond to a request for comment.
The program would make Saudi Arabia the second country in the six-nation Gulf
Cooperation Council to tap nuclear power after its neighbor the United Arab
Emirates, which next year plans to start up the first of four South-Korean built
Industry specialists estimate the deal for Saudi Arabia's two reactors could be
worth around $12 billion, based on the $24 billion total cost for the UAE
project, although it could vary depending on the vendor chosen.
Apart from Russia and South Korea, the possible U.S. bid in Saudi Arabia could
also face competition from the Areva nuclear business of France's state-owned
EDF <EDF.PA>, which said last month it was in talks with Riyadh about supplying
China General Nuclear Power Corp (CGN) is another potential vendor.
Saudi Arabia is considering building 17.6 gigawatts (GW) of nuclear capacity by
2032, the equivalent of up to 17 reactors. A senior Saudi nuclear official told
a conference in Abu Dhabi last month that the kingdom was looking at a
1,000-1,600 megawatt range per reactor for the first two.
Industry sources have told Reuters the first two reactors could have a combined
capacity of up to 2.8 gigawatts.
State-owned Russian nuclear group Rosatom said on Nov 2 it had sent initial
proposals to Saudi Arabia for nuclear power generation and would bid if a tender
was announced. The company has become a dominant player in the global nuclear
industry following the financial troubles of Areva and Westinghouse.
(Additional reporting by Tom Hals in Wilmington, Delaware; Writing by Sylvia
Westall; editing by Anna Willard)
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