Konin, 31^st October 2022

 

 

 

Polish Ministry of State Assets, Korean Ministry of Trade, Industry and Energy, Polish energy companies ZE PAK and PGE, Korea Hydro & Nuclear Power (KHNP) have announced that a letter of intent regarding the development plan of a nuclear power plant at the Pątnów site and an MOU between the ministries were concluded. 

 

The CEOs of the three companies of the two countries, Polish private energy group ZE PAK, Polish energy group with a majority share of the State Treasury PGE Polska Grupa Energetyczna and Korean KHNP signed the letter of intent, of which the main point is the three companies intend to push ahead with the development plan of a nuclear power plant in Pątnów location in Poland based on APR1400 technology.

 

Polish Deputy Prime Minister and Minister of State Assets and Korean Minister of Trade, Industry and Energy signed MOU to spare no effort to provide support for the Pątnów project promoted by the companies with cooperation in nuclear energy, and enhance cooperation with sharing information on a regular basis.

 

The intention of the parties is assessment of the possibilities of developing cooperation on the construction of a nuclear power plant in Pątnów location in order to provide Poles with cheap and clean energy. The project is intended to support the independence and stability of the Polish energy system - simply to be a stable source of cheap and clean energy. Ultimately, the project should increase the competitiveness of the Polish economy, create new investment opportunities in Poland, but above all, provide Polish households with cheap and clean energy at a stable price for the next 60 years. Potential cooperation is intended only as a supplement to the Polish government’s strategic, nuclear power program included in the "Poland’s Energy Policy until 2040".

 

ZE PAK and PGE opted for potential cooperation with KHNP because of safe, operating for over 40 years and effective Korean nuclear reactor technology. Currently, KHNP is the third largest nuclear power plants operator in the world and has recently successfully completed one of the world’s largest investments on time and on budget - the nuclear power plant in the United Arab Emirates in Barakah. The power plant consists of 4 blocks of 1,400 MW of capacity each, which means 5,600 MW of cheap, clean and stable energy providing more than ¼ of the UAE's electricity demand.

 

The parties intend to jointly prepare a plan to develop the nuclear power plant based on Korea’s APR1400 technology. In particular, the parties intend to perform preliminary analysis of geotechnical, seismic and environmental conditions, develop an estimated budget for the preparatory work, construction phase and production phase along with the proposed project financing model, as well as create a variant project implementation schedule along with the definition of key stages affecting the potential project implementation. The parties intend to prepare a preliminary development plan for the nuclear power plant at the Pątnów site by the end of 2022.

 

Regarding the project, each party has made assessment as follows:

 

„We need sources of cheap and stable energy in Poland. Nuclear energy is essential in Polish conditions, especially in the current geopolitical situation. The initiative of ZE PAK and PGE is extremely interesting because it fulfils the strategic goals of Poland and Poles - cheap energy and energy independence. According to Poland’s Energy Policy until 2040 adopted by Polish government in 2021, Pątnów is one of the potential locations for a nuclear power plant in Poland. The construction of the nuclear power plant in Pątnów could be a support for Poland’s nuclear energy program, which is crucial for us a national perspective. We welcome the information that ZE PAK and PGE have entered into talks with KHNP, which will further strengthen relations between Poland and South Korea. Certainly, this would be the next step in strengthening business cooperation between our countries and a great opportunity for knowledge and experience transfer.” said Mr. Jacek Sasin, the Polish Deputy Prime Minister and Minister of State Assets.

 

„First, the project is evaluated as an achievement supported by the Korean government’s firm determination and policy to export nuclear plants. For Korea, the project has reopened the gate for nuclear power plant exports in 13 years since the export to the UAE in 2009 while it validates the excellence of the APR1400. Also, once the final contract is made, we anticipate that it will greatly contribute to revitalizing the domestic nuclear industry by providing the nuclear industry struggling with lack of business with work. Moreover, the project will be an opportunity for the level and depth of cooperation in the industrial and economic sectors between our two countries to be broadened. Amidst the recent instabilities in the global supply chain network, we plan on expanding this cooperation in nuclear power to various areas such as the defense industry, batteries, hydrogen and electric vehicles. The conclusion of the MOU and the LOI between the companies has laid the foundation for strengthened cooperation with Poland that leads to a mutual benefit and win-win situation.” said Mr. Chang-Yang Lee, Korean Minister of Trade, Industry and Energy.      

 

„KHNP is a safe and reliable global energy leader with over 50 years of experience in construction and 40 years of experience in the operation of nuclear power plants. With unparalleled expertise and capabilities, KHNP is a trusted supplier for new nuclear power plant construction. We currently have 24 units of nuclear power plants in operation and 6 units under construction in Korea and the UAE. The Korean APR1400 is a Generation III+ reactor which offers the most advanced passive safety and security features, and the request for cooperation by ZE PAK reaffirms Korea’s excellent technology and competitiveness of the Korean nuclear power industry to the world. I strongly believe that potential cooperation between Poland and Korea will play a significant role in further solidifying the strong partnership between our two countries.” said Dr. Jooho Whang, President & CEO of KHNP.

 

„Our goal is to provide Poles with cheap and clean energy. There is no doubt that nuclear power is a source of that. Our Pątnów location seems to be ideal for the implementation of a nuclear energy project, hence our idea to create a development plan for such a project. We are glad that today, as ZE PAK, we can announce a partnership with the South Korean company KHNP, the world leader in nuclear technologies, and with PGE, the largest power company in Poland. We have the necessary infrastructure, experience and passion of our power engineers in the region for new challenges. We are an energy company in transformation that is gradually moving away from lignite-based energy production and developing zero-emission energy sources. We have fantastic and experienced people in the energy industry, whom we want to provide the opportunity to continue working in the region. Investing in nuclear power is an opportunity for Poland, for the region, and most of all for us Poles - because nuclear power means stable, clean and cheap energy for Polish businesses and households. It is also a development impulse for a number of potential Polish suppliers, work for thousands of people and the transfer of highly advanced technologies and knowledge. It is also a powerful investment in the Polish economy and significant tax revenues for the country and the region” said Mr. Zygmunt Solorz, ZE PAK Chairman of the Supervisory Board and main shareholder.

 

“Poland needs to invest in large-scale nuclear power in order to replace coal-based conventional energy in future. Together with investments in RES, this will be the basis of our energy security. This is particularly important given the global energy crisis and fossil fuel market constraints caused by Russian invasion on Ukraine” – says Mr. Wojciech Dąbrowski, President of the Management Board at PGE Polska Grupa Energetyczna –“ As the largest energy company in Poland, we are leading the domestic energy transition.  We already supply electricity to nearly 6 million customers throughout Poland. Our distribution area covers almost 40% of Poland’s area. At the same time, we are the largest heat producer in Poland, holding approx. 25% in market of heat from co-generation. Being the leader of the Poland’s energy transformation, as one of the first utilities in the region we announced our goal of climate neutrality by 2050. We are the leader in green energy in Poland and the largest investor in the Baltic Sea, and our plans include the largest domestic investments in offshore wind farms, which will generate first electricity in 4 years. By 2040 the capacity of PGE’s offshore wind farms will reach at least 6.5 GW “– adds Mr. Wojciech Dąbrowski.

 

The Parties will make every effort to optimize the estimated investment and operating expenditures of the investment, with a view to delivering stable, clean and cheap electricity in an efficient time.

The potential investment in nuclear power plant in Poland will provide Polish companies with opportunities to participate in a broad supply chain based on new technologies. It is also possible support for Poland in terms of tax stream, both at the level of the company producing electricity, and - through induced effects - at the level of other companies. Potential cooperation between Poland and South Korea in the construction of the nuclear power plant in Pątnów will increase Poland's energy independence and may create great opportunities for sharing knowledge and experience as well as developing mutual business cooperation between the countries.