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BUCHAREST (Romania), February 24 (SeeNews) - Romania's energy ministry said on Thursday that it intends to speed up negotiations with China General Nuclear Power Corporation (CGN) on the construction of reactors 3 and 4 of Romania's sole nuclear power plant (NPP) Cernavoda, operated by Nuclearelectrica [BSE:SNN].
"The negotiations have lasted too long and it is time to get closer to a decision. In the coming period, the ministry will attach priority importance to the talks in order to reach an agreement to move ahead with the project," energy ministry state secretary Robert Tudorache said following a meeting with CGN officials. "We will initiate as soon as possible a government memorandum to obtain a negotiating mandate in relation to CGN."
The energy ministry and CGN will set a timeframe for the establishment of a project company that will carry out the construction of the two new reactors.
The officials of the Chinese company too pledged to streamline the negotiations process.
The negotiations with CGN were already extended three times in 2016.
In December 2015, Nuclearelectrica said it expects to set up a joint venture with CGN in 2016 and begin the construction of a pair of new units at the power plant, a project estimated at 6 billion euro ($6.5 billion) at the time, in two to three years.
Under the memorandum of understanding on the project, the Chinese investor will hold a stake of at least 51% of the joint venture company that will do the job, while Nuclearelectrica will own at least 30%.
The Cernavoda NPP already operates two CANDU 6 nuclear reactors of 700 MW each, which entered into service in 1996 and 2007. Combined, they are the largest power producer in the country, accounting for about a fifth of Romania’s electricity supply.
Adding a second pair of similar reactors is a priority for Romania with regard to the country\s energy security. The project is considered to be the optimum solution for covering the power production deficit that is expected to occur after 2020.
Nuclearelectrica's net profit dropped 27% on the year to 108.7 million lei ($25.6 million/24.1 million euro) in 2016.
The company's 2016 results were influenced by the unfavourable fluctuations in foreign currency exchange rates, lower regulated energy transport tariffs and lower energy sales.
In order to perform investment works on Cernavoda's Unit 1, the power plant's operator extended the outage from the normal duration of some 30 days to 50 days, which led to a decrease of 3% in the volume of sold electricity and implicitly, a decrease in revenues of 3%.
In November 2016 and January 2017, Nuclearelectrica disconnected Unit 1 from the grid for several days due to damages to a power line caused by harsh winter weather conditions.
Nuclearelectrica shares were trading 1.25% down at 6.31 lei on the Bucharest Stock Exchange at 0930 CET on Friday.
(1 euro=4.5190 lei)