Breakthrough deal for Candu and China Nuclear to build two reactors in Romania

Candu Energy and China Nuclear Power Engineering Company Sign Cooperation Agreement for Two CANDU Reactors in Romania

MISSISSAUGA, ONJuly 24, 2014 /CNW/ – Candu Energy Inc., an SNC-Lavalin company, today signed a binding and exclusive cooperation agreement with China Nuclear Power Engineering Company, Ltd. (CNPEC) for the construction of CANDU Units 3 and 4 at the Cernavoda Nuclear Power Plant in Romania.  Signed in Vancouver, the agreement was witnessed by senior representatives of China’s National Energy Administration and Natural Resources Canada.

Romania already has two operating CANDU 6 nuclear reactors, which came into service in 1996 and 2007. Combined, they are the largest power producer in the country, accounting for about 20 per cent of Romania’s energy supply. This agreement follows a letter of intent signed by CNPEC’s parent company China General Nuclear Power Group (CGN) and Romanian utility Societatea Nationala Nuclearelectrica (SNN) in November 2013 for investment in and development of two additional nuclear units at the Cernavoda site.

“Candu Energy looks forward to working with CNPEC to meet Romania’s growing nuclear energy requirements.  This is an exciting opportunity to build on CANDU technology’s international track record for the highest levels of safety, reliability and efficiency,” said Preston Swafford, Candu Energy President and CEO.  “Today’s agreement deepens our strong ties with both the Romanian and Chinese nuclear industries, as CANDU reactors have operated in both countries for more than a decade.”

CANDU nuclear technology has an established presence in China, with two 700 megawatt CANDU reactors at Qinshan Phase III, located southwest of Shanghai. Completed in 2003, the Qinshan units are among the best performing nuclear units in China with lifetime capacity factors of over 91 per cent.

“This project stands to make a meaningful contribution to Canada’s economy and support highly-skilled jobs here at home.  It demonstrates the tremendous export value of Canadian nuclear expertise,” added Mr. Swafford.

Candu Energy is pursuing other international new build opportunities in the United Kingdom and China, among other markets.

About Candu Energy Inc.

Candu Energy Inc. is a leading full-service nuclear technology company providing nuclear power reactors and nuclear products and services to customers worldwide. Candu Energy’s 1,200 highly skilled employees design and deliver state-of-the-art CANDU® reactors, carry out life extension projects, and offer operations, maintenance and plant life management services for existing nuclear power stations.

CANDU reactors use natural uranium fuel, heavy-water moderator and heavy-water coolant in a pressure tube design. They can be refuelled on power and have one of the highest lifetime capacity factors among the world’s reactors. CANDU reactors are ideal for small and medium electric grids; the newest designs are equipped with a number of safety enhancements to meet the latest Canadian and international standards, including post-Fukushima enhancements. They benefit from the CANDU 6 experience of proven design, construction and operation.

Swafford setting course for Candu in China

On February 25, 2014 SNC-Lavalin Inc. (TSX: SNC) announced the appointment of Preston Swafford to the role of Chief Nuclear Officer, President and CEO, Candu Energy. Based in Toronto and reporting to the Company’s Power Group President, Alexander (Sandy) Taylor, Mr. Swafford will be responsible for growing SNC-Lavalin’s nuclear business to meet the needs of its customers for technical services, major refurbishments and new builds across Canada and in key international markets. Mr. Swafford has impressive experience including senior positions at Tennessee Valley Authority (TVA) and Exelon, both companies are major American nuclear operators. On hearing the news industry observers wondered what course would be set by Swafford, and how applicable would his experience be with the iconic, definitively Canadian Candu heavy water reactors. Reports from a major trade show in China earlier this month, China International Nuclear Industry Exhibition, are providing an indication that Swafford is already starting to make his mark.

Candu Energy Inc. has had a rough period in recent years. Demand for new nuclear softened post Fukushima and in the wake of the financial crisis. Nations with stronger economies, such as China and India, have a burgeoning middle class that is hungry for cheap, reliable energy, and also, a need to rein in greenhouse gas (GHG) emissions for air quality, health and climate change reasons. International manufacturers have made inroads in these emerging markets with innovative new technologies, such as the four Westinghouse light water AP1000 reactors that China started building in 2008. With diminished demand, government support and privatization domestically, Candu needs to reinvent and reposition itself for the new 21st century nuclear market.

Swafford has quickly displayed that he understands the unique attributes of the Candu reactors. Some of the reactor features that made Candu a global leader when first developed decades ago are still highly relevant today. Candu reactors have demonstrated that they can use spent fuel to produce energy. Further, they can be most readily modified to use thorium as a fuel and they have superior safety features. Engineers estimate that for every four new reactors that China builds of various designs, they could and should build one Candu reactor to use the spent fuel. If China follows through on plans to build 100 new reactors in coming decades, this could potentially mean 25 new reactor sales for Candu.

Sales cycles in the nuclear industry are long. It is still early in the game for Swafford and the new Candu. One thing is certain, new innovations, partnerships and financial players are emerging. As with other technology industries, your competitor today may be your partner tomorrow. Who would have thought years ago that western companies would be selling nuclear technologies to China? Who would have thought that China, France and Russia would be involved in building and financing a new reactor in Britain? These are the times we are now in. Candu is setting a course to be a player in this new world.

Henry Vehovec
Chair, Future of Nuclear Advisory Board
President, Mindfirst Inc.