WATCH: Inside factory building Koeberg’s lifesaving generators

Cape Town – While Areva’s contract to manufacture six steam generators to expand Koeberg’s lifespan might be heading for the Constitutional Court, Areva said it plans to deliver on schedule.

The court action had not affected manufacturing, Patrick Poret, director of Areva’s heavy equipment production line, told Fin24 in France on Friday.

“The process is going very smoothly,” he said, pointing to the factory responsible for the operation that could extend Koeberg’s lifespan by a decade. Koeberg nuclear power station, which is situated outside Cape Town, is responsible for 6.2% of the country’s electricity generation and is Eskom's most cost-effective generation unit.

“We started the work in September 2014,” he said. “So far, most of the procurement has been launched and we have already received 30% of the shells.

“Our partner in China has started the manufacturing under the supervision of our teams. We have also started some manufacturing in our shop.”

An Eskom contract with Areva to replace six steam generators at its Koeberg nuclear power station was set aside and ruled as “unlawful” and “unfair” in a scathing judgment by the Supreme Court of Appeal (SCA) on December 8 2015, EE Publishers reported on Fin24.

“Although Westinghouse asked to be substituted for Areva as the successful bidder, the Appeal Court did not grant this. However, the Supreme Court of Appeal did order that the contract award be set aside and referred back to Eskom for reconsideration.

“Could there be any safety issues arising from delays in the Koeberg steam generator replacement project, and continued operation of the Koeberg reactors beyond the planned outage deadline of June 2018 for the replacement of the steam generators,” the report questioned.

FULL STORY: The story behind Eskom’s ‘unlawful’ Koeberg contract

WATCH: Interview with Patrick Poret, director of Areva’s heavy equipment production line

Where France will build SA's 9 600 MW nuclear reactors... if it wins

Fin24 visited the factory in Chalon, 130km north of Lyon in France, which is where Koeberg’s reactor and steam generators were manufactured in the 1980s. “It is quite an honour for us to continue to cooperate with South Africa,” said Poret, with the South African flag flying behind him.

This is the factory that would build South Africa’s 9 600 MW nuclear components should France win the contentious new build bid. The Department of Energy plans to release its Request for Proposals at the end of March and expects to build six nuclear units every 18 months beginning in 2022.

“If we have the chance to succeed in South Africa, this factory will be involved,” said Poret. “Hopefully, it will involve some South African partners there and we are going to work closely to deliver all components on time to make a success of this project.”

A sector in crisis

Areva is technically bankrupt, was downgraded to “junk status” by Standard & Poor's, and saw its share value plunge to a new historic low on 9 July 2015, a value loss of 90% since 2007, the World Nuclear Industry’s 2015 status report explained.

“Areva plans to create a new group later this year - currently referred to as ‘New Areva’ - that will bring together all its fuel cycle operations: mining, chemistry, enrichment, recycling, dismantling, logistics and related engineering,” reported World Nuclear News.

“The company will be broken up, with French state-controlled utility EDF expected to take the majority stake in the reactor building and maintenance subsidiary Areva NP that will then be opened up to foreign investment. The move could turn out highly problematic for EDF as its risk profile expands,” according to the World Nuclear Industry report.

“Twenty-nine years after the Chernobyl disaster, none of the next-generation or so-called Generation III+ reactors has entered service, with construction projects in Finland and France many years behind schedule. Of 18 units of Generation III+ design (eight Westinghouse AP1000, six Rosatom AES-2006, four Areva EPR), 16 are delayed by between two and nine years,” the report said.

When Fin24 visited the Areva factory on Friday, there was no sign of any nuclear reactor manufacturing, with all the work focusing on steam generators.

“There is no significant export market for Areva's reactors and as this report shows, ongoing projects are constantly delayed and most potential new markets don't meet the reality check,” according to the World Nuclear Industry report.

The nuclear industry saw a further decline in its sector in 2015, the report said. "There were 62 reactors under construction - five fewer than a year ago - of which at least three quarters are delayed. In 10 of the 14 building countries, all projects are delayed, often by years. Five units have been listed as 'under construction' for over 30 years."

* Fin24 was a guest of the French government. France (through EDF and Areva) is one of the bidders for SA's proposed nuclear build programme.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot