Platts - Tuesday, April 25, 2006 http://www.platts.com ------------ Investment in nuclear in the UK could be a serious consideration London (Platts)--25Apr2006 Investment in nuclear, without subsidies, would be seriously considered in the UK if the government established a long-term framework to support low- carbon energy sources, the Confederation of British Industry said April 24. CBI pointed to a "unique window of opportunity" for the UK to move to a more low-carbon generation mix, given the country's need to add 50 gigawatts of new capacity by 2020, equivalent to approximately two-thirds of existing capacity. Such a framework would also ensure other low-carbon energy sources could compete, it said. CBI quoted figures from the consulting firm Deloitte that suggest that total investment costs for 50 GW of additional capacity could be between GBP 22 billion (US$39 billion) for a fuel mix weighted toward combined cycle gas turbines, and GBP 51 billion ($91 billion) for a fuel mix including significant proportions of renewables, plus some nuclear and clean coal. ------------ Areva submits eight bid to Chinese customers London (Platts)--25Apr2006 Areva confirmed that it submitted an eight bid to Chinese customers earlier this month, but declined to reveal any details of its offer to build four EPR units, two each at Sanmen and Yangjiang. (The company reportedly had offered a seventh bid in early February.) Company spokesman Charles Hufnagel denied reports that Areva was divided on its policy concerning technology transfer to Chinese entities, saying the Areva group's "commercial policy ... is, in China as everywhere else, united and coordinated." On April 21, Areva Chief Executive Anne Lauvergeon told the Anglo-American Press Association in Paris that "[i]t is untrue to say that we refuse to transfer technologies" to China. "But we refuse to sell technologies without building" the reactors, she said. Lauvergeon was responding to press reports in March suggesting Areva had lost the Chinese reactor bid to Westinghouse because the latter was willing to sell just the blueprints for its AP1000 design. Westinghouse officials have denied the reports. For more news, request a free trial to Platts Nucleonics Week at http://www.platts.com/Request%20More%20Information/ ------------ Davis-Besse expected to return from refueling soon Washington (Platts)--24Apr2006 Davis-Besse is expected back on line in the "next few days," FirstEnergy Nuclear Operating President and Chief Nuclear Officer Gary Leidich said today in a telephone interview. Leidich said the current refueling and maintenance outage, which began March 6, is taking "several days" longer than projected because the outage team is "focused on safety" and has paused some activities to resolve potential safety issues. The slight delay, Leidich said, is the "reality" of the first refueling outage since the 925-MW PWR was shut down for two years after the discovery in March 2002 of severe vessel head degradation. Westinghouse CEO: Changes will mark how new plants constructed ------------ London (Platts)--24Apr2006 Future nuclear plant construction will be done differently than in the past and will vary by country, Westinghouse President/CEO Steve Tritch told Platts during a recent interview. For example, most US nuclear operators don't plan to do as much construction work for future plants as they did during the first wave of building, he said. "The US will be looking for more of an overall buying of plants along turnkey lines," he said. This turnkey approach will be "a little different than the way it evolved in the US last time where many of the utilities were involved in constructing their own plants," he said. Because of industry consolidation, there are fewer nuclear plant operators, but with more nuclear assets, he said. They "focus more on their own core competence, which is operating nuclear plants," he said. They have formed partnerships or long-term supply agreements with vendors to provide services and fuel in longer-term increments, he said. "And we've seen more of that happening in the US than used to happen because the utilities which own many nuclear plants have decided they want to link up with a few key suppliers" to ensure maintenance and operation and fuel supply over the long term, he said. However, the US approach will differ from that of other countries, he said. For example, the Chinese concentrate on creating their own indigenous capability. Therefore, the scope of any contract with Chinese companies will be different than "how it gets done in the US market," Tritch said. Also, the updated AP1000 design will mean Westinghouse plants will be constructed differently than in the past. The modular construction concept of the AP1000 opens up the possibility of factories around the globe each producing several of the 300 modules that make up the reactor, Tritch said. "These would be done on more of a production-line basis with quality assurance at the site where the modules are being built," he said. The end-of-March UK Nuclear Industry Association's report on UK nuclear construction capability noted that construction of Westinghouse AP1000 reactors "involves the remote production of structural modules in a factory/ship yard environment, shipping to site and then assembly." It said that the size and weight of the modules would require delivery to the site by sea. Moving them around "would require the use of self propelled modular transporters and a suitable jacking system to place the modules." Heavy lifting equipment might also be required, not just for the large nuclear items as in past reactor construction, but for the modular items. For more information, take a trial to Platts Nucleonics Week at http://nucweek.platts.com. ------------ Iran says going nuclear will free up crude for export Doha (Platts)--24Apr2006 Iranian oil minister Kazem Vaziri Hamaneh said Monday that advancing Iran's nuclear program would eventually help oil markets because it would free up crude oil for export after US Energy Secretary Samuel Bodman's advised against doing business with Iran to force it to end its nuclear ambitions. Asked by reporters if developing nuclear power would help the market, Vaziri Hamaneh replied: "Definitely that is the case because this will save oil and gas that we are consuming and that would be available for the international markets and that's one of the ideas for going for the nuclear energy." "I think this is his [Bodman's] views but the truth is that the investment in Iran is doing very well and it is for the oil and gas and we have no concerns," Vaziri Hamaneh said on the sidelines of the 10th International Energy Forum, a biannual talking shop for oil producers and consumers. The US and its allies are accusing Tehran of pursuing a clandestine nuclear enrichment program to develop a nuclear arsenal, a charge the Islamic Republic denies. OPEC number two Iran, which is desperately trying to raise its crude oil production capacity and develop its massive gas reserves, second only to Russia, has argued that it needs nuclear power to boost crude exports and meet rising world demand, thereby easing consumer fears over energy security, a key theme at the Doha conference. But the US, which imposed sanctions in 1996 against Iran and Libya -- sanctions against Tripoli were dropped in 2004 -- has made public its displeasure at energy deals involving Iran, in particular a gas pipeline deal to India through Pakistan, a Japanese agreement to develop the 26 billion barrel Azadegan oil field and an LNG and oilfield development project with China. Iran, which puts current production at its OPEC quota of 4.11-million b/d -- which is close to its maximum capacity -- has been somewhat shackled in its efforts to raise production capacity to over 5 million b/d by 2010 and to 8 million b/d by 2015 partly by the US sanctions, which has kept out US majors and the likes of BP. Another deterrent has been the buyback formula used by Iran to bypass a constitutional ban on production-sharing, the terms of which are currently being amended to help along stalled projects like the Yadavaran and Azadegan oilfield development projects with Japan and China. Iran's Vaziri Hamaneh denied in Doha that foreign investment flows into the energy sector were slowing down because of US pressure on potential investors and he blamed US foreign policy for high oil prices as well as on speculators he said were "inflaming" oil markets. Vaziri Hamaneh, who met with the Japanese, Indian and Pakistani ministers on the sidelines of the Doha conference, said Tehran was pressing ahead with its energy development projects. "I think next week, we're going to send a delegation to China to discuss the Yadavaran field and also the LNG project. We are preparing the initial stage of preparing the contract but the contract is not yet signed. But we are preparing the stages for the signing," he said. The agreement, worth $100-billion includes a 25-year LNG export agreement. The agreement would also grant a 51% share in the development of Iran's onshore Yadavaran oilfield to China Petroleum and Chemical Corp (Sinopec), which would receive 150,000 b/d of the field's crude oil for the same period. Chinese energy demand growth as well as its position as a permanent member of the UN Security Council has made the success of the mega oil and gas deal increasingly important for Tehran, which faces the prospect of possible UN punitive action over its nuclear program. Vaziri Hamaneh also said that he met Japanese energy minister Toshihiri Nikai in Doha to try to push forward the Azadegan oil field development Tehran has been negotiating with a Japanese consortium. "I just talked to the minister of energy and he emphasized that it is one of the most important energy projects they have," Vaziri Hamaneh said, adding that a Japanese delegation was in Tehran on Monday "negotiating, finalizing some of the points." He added: "We have the written commitment and their willingness from their side they would like to pursue this project." A Japanese government official March 23 denied a report that the US had informally asked Japan to delay the development of Azadegan by Japan's Inpex. Japan has stressed the importance of the $2 billion project to Japan, which is wholly dependent on imported crude to meet its oil needs. Another project that appears to have been propelled forward by the presence of key ministers at the Doha talks was the proposed gas pipeline from Iran to India through Pakistan. "We had a meeting with our counterparts from Iran and Pakistan the day before yesterday. We are willing to have this project and we are also willing to do this project together and we are hopeful this will be done. We are not concerned," Vaziri Hamaneh said. "They (India and Pakistan) are interested and we are willing so all parties are willing to do it so we have no concerns," he said. Pakistani oil minister Amanullah Khan Jadoon said Sunday that he hoped to sign an agreement with Iran and India in Jund for a $7-billion gas pipeline to carry Iranian gas to both countries. For more information, take a trial to Platts Oilgram News at http://oilgramnews.platts.com. ------------