COMPANIES ECONOMY ENERGY

Shareholders approve Memorandum for construction of reactors 3 and 4 at Cernavoda

The Memorandum of Understanding for the development, construction, operation and decommission of Reactors 3 and 4 of the Cernavoda Nuclear Power Plant was approved last week by the Shareholders’ General Assembly, subsequent to its approval by the Romanian Government on September 2, the company informs.

The Memorandum is part of the government strategy to continue the Reactors 3 and 4 project by organizing a procedure for selecting investors, approved by Nuclearelectrica’s Shareholders’ General Aseembly on October 22, and establishes the future directions of cooperation between the signatories – Nuclearelectica National Company (SNN) and China General Nuclear Power Corporation (CGN) – in order to develop the project.

“The project of Reactors 3 and 4 of the Ceranavoda Nuclear Power Plant is the optimal investment on the one hand for the Romanian state and, implicitly, for the Romanian energy system from the point of view of ensuring the long-term security of supply, independence, a balanced and stable energy mix capable of backing the attainment of decarbonisation targets and on the other hand for Nuclearelectrica from the point of view of capitalizing on assets and on the financial growth associated to the operation and the providing of maintenance and fuel for the new project company. The project entails the creation of jobs and the horizontal development of the nuclear industry. The Reactors 3 and 4 project in fact means macro- and microeconomic development,” Nuclearelectrica CEO Daniela Lulache stated.

After the signing of the Memorandum of Understanding, SNN and CGN will enter the final stage of the selection procedure, namely negotiation and the completion of the Investors’ Agreement and of the Articles of Incorporation of the new project company that will construct reactors 3 and 4.
SNN and CGN started the negotiations related to the Memorandum of Understanding in March 2015, the document being approved by SNN’s Board of Directors, the Negotiation and Interministerial Commissions and by the Romanian Government on September 2.

“The memorandum of understanding sets out the directions of the future cooperation between Nuclearelectrica (SNN) and China General Nuclear Power Corporation (CGN) in order to develop and implement the project. After both sides sign the memorandum, SNN and CGN will start the negotiation process related to the start and completion of the strategy’s final stages: the negotiation of the Investors’ Agreement and the Articles of Incorporation of the new project company, the creation of a new project company (a joint-venture – JVCo – in which CGN will control at least 51 per cent of the shares), the JVCo’s future corporate governance and the structuring of financing for the development of the project,” a Nuclearelectrica communiqué released on September 18 pointed out.

Likewise, SNN’s investment in EnergoNuclear (EN) will be fully transferred to the new project company.
Nuclearelectrica (SNN) will contribute EUR 2 M to the setting up of the mixed company (JVCo) which will build reactors 3 and 4, and will own 49 per cent of the shares, while the Chinese investor – China General Nuclear Power Corporation (CGN) – will own the remaining 51 per cent.

“Subsequent to the setting up of JVCo, CGN and SNN will make sure SNN is able to fully recover the value of its investment in EN. The sides have taken note of the fact that the total value of SNN’s investment in EN is the higher value between the value of EN’s registered capital subscribed and paid on 31 December 2014 (RON 146,152,998) and the value of EN’s merger through absorption,” the Memorandum points out.

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