Areva signs Jaitapur agreements

Areva has signed two agreements with Indian companies in preparation for the project to construct six EPR units at Jaitapur in Maharashtra state. The agreements were signed during a visit to Paris by Indian prime minister Narendra Modi.

Areva has signed two agreements with Indian companies in preparation for the project to construct six EPR units at Jaitapur in Maharashtra state. The agreements were signed during a visit to Paris by Indian prime minister Narendra Modi.

L&T's president of heavy engineering M V Kotwal and Areva CEO Philippe Knoche sign the MoU in the presence of Indian prime minister Modi and French president Hollande (Image: Indian Prime Minister's Office)

A total of 20 agreements covering a range of issues - including satellite communications, railways, tourism, conservation and education - were signed between France and India on 10 April during a meeting between Modi and French president Francois Hollande. Two agreements relate to the construction of the proposed Jaitapur plant.

Areva signed a pre-engineering agreement (PEA) with state-owned Nuclear Power Corporation of India Limited (NPCIL) on 9 April. The signed agreement was exchanged between Areva CEO Philippe Knoche and Indian ambassador to France Arun Kumar Singh the following day in front of Modi and Hollande.

This agreement will prepare for the licensing of the EPR reactor design in India enabling it to be deployed at Jaitapur. In a statement the Indian government said, "The PEA studies intend to bring clarity on all technical aspects of the plant so that all parties (Areva, Alstom and NPCIL) can firm up their price and optimize all provisions for risks still included at this stage in the costs of the project."

Separately, Areva signed a memorandum of understanding (MoU) with engineering company Larsen and Toubro (L&T) for cooperation to maximize localization for the Jaitapur project. This agreement was signed by Areva's Knoche and L&T's president of heavy engineering M V Kotwal.

L&T said, "The MoU covers the prospect of partnership between L&T and Areva in manufacturing key nuclear island equipment, valves, piping, electrical, instrumentation and engineering work. Through this partnership, Areva will transfer technology to utilize the forging capabilities of L&T Special Steels and Heavy Forgings (a joint venture with NPCIL)."

The company noted that the MoU with Areva "represents a major step forward" for L&T in the field of pressurized water reactor (PWR) technology. It said, "This is a significant addition to L&T's existing capabilities and the lead role it has played in equipment manufacture, construction and project management for pressurized heavy water reactors (PHWRs) in India's domestic nuclear power program."

A memorandum of understanding to cooperate on the construction of the Jaitapur plant, including lifetime fuel supply for the units, was signed by NPCIL and Areva in February 2009. This was followed by the signing of a general framework agreement between the two companies in December 2010, under which Areva is to supply nuclear islands and associated services for the first two EPRs planned for the Jaitapur site.

Plans for the Jaitapur plant, as well as other proposed plants featuring imported reactor designs, were put on hold when India subsequently brought in an unusual liability regime. In most countries, liability for a nuclear accident is chanelled exclusively to the operator who takes responsibility for the safe construction and operation of their power plant, but Indian legislation written in 2010 could see part of this channelled to the supplier under certain circumstances. This condition has been deemed unacceptable by reactor vendors.

It is understood that the solution to the liability issue is the creation of a $250 million insurance pool. Such pools are used in most countries by nuclear power plant operators to cover their accident liability to a certain level, while sovereign responsibility and international agreements cover remaining costs. In India, a pool could be used by the suppliers to mitigate the extraordinary clauses of India's liability law.

Researched and written
by World Nuclear News