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Suez to "own and operate" nuclear plants

Friday, 9 March 2007

In reporting its 2006 results, the French energy trading company Suez has declared an objective for 2015-20 to own and operate new Generation-III nuclear plants. It also discussed a forthcoming merger with Gaz de France and the sale of Tractebel to Electrabel.

In reporting its 2006 results, the French energy trading company Suez has declared an objective for 2015-20 to own and operate new Generation-III nuclear plants.

Suez is an energy trading company mainly concerned with electricity and natural gas, boasting 158,000 employees. On 7 March it reported revenues for FY 2006 of Eur4.5 billion ($6 billion), a 15.9% rate of organic growth. G�rard Mestrallet, Suez chair and CEO said the results "prove the strength of the Suez business model" and that Suez' environmental division's operating income reached Eur1 billion ($1.3 billion) was "a sign of exceptional dynamism."

As if buoyed by these successes, the report went on to include that "Suez has the firm intention of increasing its nuclear power generation capacities through the construction of new power plants in Europe in line with national public policies. The objective for 2015-20 is to own and operate new third-generation nuclear plants."

In a Eur445 million ($584 million) investment, Suez intends to buy the remaining 1.38% of Electrabel, its Belgian subsidiary which owns and operates three pressurized water reactors at Tihange, while operating four more at Doel.

However, nuclear expansion through Electrabel would not likely occur in Belgium, where a 2003 government act prohibited further nuclear build and limited the lifetimes of existing plants to 40 years. Suez is thought to be interested in projects such as the completion of Cernavoda 3 in Romania.

Suez has another subsidiary, Tractebel, which carries out nuclear engineering work, and this is expected to be sold to Electrabel in the near future after consideration by the Suez board of directors.

Any new nuclear plants that could be built elsewhere in Europe would help towards Suez' aim of increasing installed capacity by 23,000 MW to 75,000 MW by 2012. The bulk of the rest of the increase would likely come from investments in natural gas and liquified natural gas.

Suez is in the process of preparing to merge with state-owned Gaz De France - a move which Mestrallet said "responds to an undisputed industrial logic." In talks over the merger, Suez have agreed with the Belgian government to sell 250 MWe of nuclear generating capacity to SPE, Belgium's second largest electricity producer. In addition, Suez and Electrabel agreed to make a long-term sales contract with SPE for another 285 MWe of nuclear capacity.

Another part of the deal would see Suez swap 100 MWe of its Belgian nuclear capacity for SPE's 100 MWe share in the Chooz B nuclear power plant in France. Electrabel also promised to put 2400 MWe of non-nuclear capacity up for auction.

Further information

Electrabel
Suez
Tractebel