May 8 (SeeNews) - Nuclearelectrica [BSE:SNN], the operator of Romania's sole nuclear power plant (NPP) Cernavoda, said on Wednesday it has signed a preliminary investors agreement (PIA) with two Chinese companies for the construction of Units 3 and 4 at the NPP.
The preliminary agreement signed with China General Nuclear Power Corporation (CGN) and CGN Central and Eastern Europe Investment (CEERI) envisages the establishment of the project company (JVCO) which will be the only technical and operational platform for the subsequent development of the project, Nuclearelectrica said in a press release.
The deadline for the set-up of the JVCO is 60 working days from the date of signing of the preliminary agreement.
The JVCO is a joint stock company that will exist for at least two years. CGN will have a stake of 51% in the project company, while Nuclearelectrica will have 49%.
"During the initial two-year duration of the new project company we will define the project's structure, as this is an essential stage prior to the construction of the two units," Romania's energy minister Anton Anton said.
Bian Shuming, general manager of the CGN Romania Nuclear Power Company, emphasized that the signing of the PIA marks a new stage in the development of the cooperation between CGN and Nuclearelectrica.
"Going forward, CGN is fully committed to working closely together with its Romanian partner on the successful development of the next phases of the project in line with the agreed principles," Bian Shuming said.
The signing of the document by the parties involved in the continuation of the project for building Units 3 and 4 represents an essential stage of the selection process launched in 2014 from a technical and operational point of view, Nuclearelectrica noted.
The preliminary agreement was approved by Nuclearelectrica's shareholders in April. CGN has also completed its internal approval process of the agreement.
In March, Nuclearelectrica signed a $120 million (106 million euro) framework agreement with General Electric Global Services/GE Global Parts & Products for the maintenance of the Cernavoda's existing Units 1 and 2.
Also in March, Nuclearelectrica signed a memorandum of understanding with U.S.-based NuScale Power to explore potential uses of small modular reactors (SMRs) in Romania. The agreement aims to evaluate the development, licensing and construction of a NuScale SMR for a potential similar long-term solution in Romania, Nuclearelectrica and NuScale said at the time.
The Cernavoda plant, located in southeastern Romania, has two reactors of 700 megawatts each, which meet roughly a fifth of the country's electricity needs.
Nuclearelectrica shares traded 0.55% higher at 10.92 lei ($2.30/2.05 euro) by 1346 CET on Wednesday on the Bucharest Stock Exchange.
Romania's energy ministry owns a 82.49% stake in Nuclearelectrica.
(1 euro=4.7578 lei)