France hoping to win big with Saudi nuclear contracts

Published April 18th, 2013 - 07:37 GMT
France is hoping to win big with Saudi Arabia's nuclear contracts
France is hoping to win big with Saudi Arabia's nuclear contracts

France’s Areva says it aims for the majority of its subcontractors to be local firms should it win an expected tender to build nuclear power plants in Saudi Arabia.

Saudi Arabia plans to build 17.6 gigawatts of nuclear power capacity by 2032, according to the King Abdullah City for Atomic and Renewable Energy (KACARE).

Areva, which develops nuclear power plants, and the French utility firm EDF, hope to win a slice of the nuclear energy market in the Kingdom.

Luc Oursel, chief executive of Areva, said the French firm has already made contact with Saudi companies and engineers ahead of the expected tenders to build the plants.

“We are discussing with Saudi Arabia… the objective of having between 50 and 60 percent of the total project built, made, designed by Saudi companies,” Oursel told Al Arabiya.

Saudi Arabia reportedly plans to produce electricity from its first nuclear plant by 2020, as it looks to keep pace with rising demand for domestic energy.

According to the Saudi Press Agency, the Kingdom may spend $100 billion to build 17 nuclear reactors over the coming two decades to produce electricity.

Oursel told Al Arabiya that the firm is already training Saudi engineers to prepare them for nuclear energy projects, which he said are expected to create “thousands of jobs”.

Areva and EDF have already set up an office in Riyadh to lay the groundwork for a possible bid for tender, and have established links with local Saudi companies and engineers. That followed a 2011 agreement between France and Saudi Arabia that offered the Saudis atomic know-how and training for local staff.

“Thanks to the subsidiary we have created in Riyadh with EDF, we are contacting all the Saudi suppliers which can play a role in this very important program,” said Oursel.

Oursel said Areva had invited 60 Saudi engineers to France for training, working in parallel with training programs in Saudi Arabia.

He did not have a timetable for the launch of the tenders for nuclear and renewable-energy projects, saying that this was up to Saudi Arabia’s government. “When it wants to launch this very important program, we are ready,” said Oursel.

Saudi Arabia has not yet launched a formal tender offer for its nuclear-power sites but is widely expected to do so, drawing the attention of global nuclear-equipment vendors.

The French firms are likely to face stiff competition from rivals in the US, Japan, South Korea and Russia.

Oursel spoke to Al Arabiya at last week’s Saudi-French Business Forum in Paris.

Senior executives from other French energy firms were also in attendance.

Christophe de Margerie, chief executive of Total, said the new Jubail refinery in Saudi Arabia was 97 percent complete and is set to begin production at full capacity of 400,000 barrels per day “before the end of year, November”.

The refinery is run by Saudi Aramco and Total.

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