Speech of SC Rosatom’s Director General Sergey Kirienko at ATOMEXPO 2010

Good morning, dear colleagues!

In the first place, I would like to welcome our guests who have found a possibility of attending this forum with such representative delegations. Many of you have become traditional participants of ATOMEXPO. It is a great honor for us to host you here in Moscow and we greatly appreciate your active participation and support.

 

I would like to especially thank Dr. Anil Kakodkar. Dr. Kakodkar is an indisputable authority in the nuclear industry and we appreciate that he found a possibility to come specifically to our forum and agreed to moderate our conference. Thank you very much.

 

Dear colleagues, since our forum has become a traditional event, I would like to remind you what we discussed at the same conference a year ago, at ATOMEXPO 2009. That time the financial crisis broke out in the world and our optimistic hope was that the world’s financial crisis would not affect the scale of the nuclear industry development, the process that has been sustainably termed as the nuclear industry “renaissance”. If a year ago we were talking about this as about our hope, our certitude, now we are talking about this as about the accomplished fact. It can be stated that the nuclear “renaissance” has withstood the test of the world financial crisis. Yes, there is some delay; yes, a certain pause took place when commissioning of new nuclear capacities has been shifted for a year or two, but the conclusion of principle is that not a single country who has made its choice for massive development of the nuclear power has cancelled the decisions taken earlier, has not refused the principle choice in favor of the nuclear power development.

 

At the same time this choice has been made in much more competitive conditions for the nuclear power, because the hydrocarbons’ price has changed. If in 2008 the choice was made on the background of oil prices standing at US$140, now it is made on the background of US$70-80. This does not change the decision of principle in regard of the nuclear power development.

 

The second conclusion is that in addition to countries who have a good experience in the nuclear power development, have a potential and continue developing the areas where there are large backlogs, most massive nuclear development programs and largest contribution in the growth of the world’s nuclear power fall to the lot of the countries which are at the very beginning of this path, who are just starting moving by this path, but these countries also have not refused their national nuclear power development programs.

 

As a result, the number of nuclear power customer-countries is increasing, and we can draw out one more important conclusion: this will require us, the world nuclear community, to be much more mobile and flexible. Because as new countries enter the path of the nuclear power development, the list of requirements changes because each of the countries entering the path of the nuclear power development has its own requirements and its own plans as regards the pace and terms of development of its own nuclear power. Meantime, the countries who supply technologies, services and capabilities must be sufficiently flexible and must be ready to meet the demand of changing terms of supply, of services and technologies.

 

In this regard, we, in Rosatom, have substantially revised the package of services we are ready to offer to our partners to broaden it. An example is what was said on this floor by Sergey Sobyanin as the Chairman of the Supervisory Board (of SC Rosatom - editor’s note): if so far we had a good experience in turn-key construction of nuclear facilities and engineering of nuclear facilities when we used to sign the contract, build the nuclear plant and thus our work was completed. Now, we have moved to the pattern where, responding to our customer’s wish, we are ready not only to build a nuclear power plant on the turn-key basis but also to be a co-investor of such project.

 

Starting from implementation of such project in Armenia where we agreed with our customer, the Armenian government, that we are ready to act as investor and shareholder of such company without pretending to have the controlling block of shares but investing about 40% in this nuclear power plant and ending with the pattern where, under the agreement signed in Turkey, the Russian party would take all 100% of interest in the project company, which will build this plant, will own this plant, operate it and sell its electricity under the contract with the Turkish government for guaranteed sales of electricity during 15-20 years on.

 

We have offered the same pattern of our participation to the government of Bulgaria who is looking for investments for the nuclear power plant at Belene, and we stated that we are so firmly convinced of efficiency of this project and that we will cover all our expenses that we are ready to become a co-investor and purchase as big block of shares in Belene nuclear power plant - as big as the Bulgarian government deems appropriate to give us.

 

We are ready to proceed with our other partners in the same manner. We do not insist on it but if our partners are interested in the investment participation of Rosatom, we are ready for it.

The second feature of our services is our readiness not only to build the facility but also to participate in its operation. In addition to Turkey I may give you an example of building the nuclear power plant in Bushehr in Iran. By the end of this summer we expect completion of starting-up and adjustment of this plant as scheduled and start of operations to approach the first power of Bushehr nuclear power plant . Meanwhile we have already agreed with the Iranian government that we are to set up a joint operating organization. Since this country just entered the path of the use of peaceful atom and did not have a sufficient experience in operating such facilities, we agreed that our specialists will work in this joint company and the plant operation will be carried out by specialists of two our countries during several coming years.

 

The third new element is the readiness to come to new nuclear construction sites not just as the Russian contractor but the readiness to set up consortium with local companies, with a high localization of equipment manufacture and construction works on the site. Our first experience in this area is Kudankulam nuclear power plant in India where construction of the first two is units is close to completion and the contract for building of the third and fourth power units has been already signed. We will move forward with the same logic in the tender in the Czech Republic where a consortium has already been established with a high localization of equipment manufacture and works in this country. The same pattern we are going to follow in Ukraine where the construction of Khmelnitsky-3,4 units can be regarded as a joint project of Russian and Ukrainian companies with a high degree of localization of equipment manufacture and contracted works to be done by Ukrainian companies. Here, we are ready to move further to set up a whole number of joint ventures not only for this project but also for future projects to be implemented in Ukraine, Russia and third countries.

 

A principally new quality is the readiness to expand the network of joint projects not only in nuclear power plants construction but also in the nuclear fuel cycle. Nearly each state which is just entering the path of the nuclear power development face this task, particularly considering that nuclear technologies are dual-purpose technologies and are subject of substantial restraints in terms of it proliferation to the new countries. Therefore, we are ready not only to supply services but also to establish joint ventures with productions being set up in these countries. Today, we have corresponding arrangements with Ukraine, India and European partners. We have already implemented such projects in China. And now we are ready to offer our partners a corresponding participation in the capital of NFC enterprises in Russia. The first experience was already realized jointly with Kazakhstan: this is not just a uranium mining JV in Kazakhstan but also the JV for uranium enrichment in Russia. This project is entering the final investment stage and we are fully confident to realize it. This is also the project of the International Uranium Enrichment Center Sergey Sobyanin also told us about. We are glad that we and Kazakhstan have been joined by partners from Ukraine. We are open for other participants to join.

 

And essentially new quality gives to this project establishing of the guaranteed reserve of low-enriched uranium. We appreciate the IAEA under whose safeguards the reserve is being placed; the reserve that ensures two full loadings of a 1000-megawatt reactor and which, by the IAEA decision, could be sent to any place in the world if a problem with timely fuel reloading occurs and the market mechanisms fail. We specifically structured our approach concerning the International Center and the guaranteed low enriched uranium reserve to have them as securing mechanisms rather than the ones replacing market mechanisms. We are certain that in the nuclear industry today functions a well-balanced uranium market and there is no need in substituting it with international or national mechanisms; the only need is to establish guarantees for any player on this market.

 

One more task of exceptional importance is to develop a range of power technologies of different scale (in the early 2000’s all countries pursued the path of increasing reactor power capacity because of its economic efficiency). But today another problem raise: 1200-, 1400-, 1600-megawatt reactors are not acceptable for countries that have just entered the path of nuclear power development. Many of them do not have a sufficiently developed infrastructure, grid facilities. Therefore, there is a goal to broaden the range of medium and small power technologies. Reactors of up to 100 megawatt and medium power reactors (300-600 MW) should be available on the market. It’s my pleasure to say that we are moving successfully to create the first pilot floating nuclear power unit of 80 MW capacity and this month, on June 30, we plan to launch the boat for this unit at the Baltijsky Shipyard in St. Petersburg. It should be brought into operation in 2012 to make a reference specimen which we would be able to offer our partners.

 

The second conclusion we drew out from the last year conference was the fact that the nuclear power has a global character and that Russia’s strategy here should consist of not only the implementation of our domestic projects but of full openness and the stake on strategic partnership, global alliances and build-in into the world nuclear power market.

 

This is the exact direction we are moving in all nuclear industry areas from uranium mining through building nuclear power plants, their decommissioning and waste disposal. We have implemented a number of decisions this year: the setting up of joint companies, acquisition of foreign companies. This is a two-way road. The same way, we are ready to open our market.

 

I have already said about setting up joint ventures in the nuclear fuel cycle. Last year, we made a decision that was of principle for Russia, decision that has never occurred in the Russian history: we stated our readiness to give foreign investors a share in a nuclear power plant on the territory of the Russian Federation. This is Baltic NPP, which has been presented at this forum, where 49% of interest is designated for acquisition by investors - foreign investors, private investors. And we believe that this is just a first experience. It is not the only possible solution, it’s just the first experience; but it’s like a door to enter the Russia’s nuclear power market.

 

And the third point I would like to dwell on today is the issue of future. As far as the programs we are working on today and the programs our partners are implementing themselves all are the long-term programs considering long-term nature of the nuclear industry. All the programs are targeted for 10, 15, 20 years from now on. Including the negotiations which are underway at this forum and the contracts which are being signed. Nearly all of them are targeted for implementation beyond 2015; all of them are long-term projects. From this point of view in conditions of the nuclear renaissance, all of us are faced with the goal of very high importance, a big challenge, if you like, the challenge of determining the future image of the world’s nuclear power. Because everything we are implementing today, all of us, are the research and development projects made in the XX century. They are successful, reliable, having a sufficient potential, but still they are developments of the XX century. And we need to determine the configuration of the nuclear power of the XXI century.

 

Therefore, we believe the adoption of the Federal Target Program “Power Technologies of the New Generation” and the governmental decision Mr. Sobyanin mentioned here are an event of exceptional importance. This is a principal support on the part of the state, which allocates funds to add to ones we are allocating as our corporate resource, to develop new technologies in the nuclear power.

 

In the first place, this solves several tasks of principle. These are new reactor technologies which ensure the task of intrinsic safety in terms of both the reliability of these nuclear reactors and the nuclear nonproliferation in the world. Here, first of all, we rely on the fact that the fast reactor technologies, at least within 20-30 years, will help us to reach an intrinsic safety of nuclear reactor in terms of its physical characteristics. This will open the possibility of involving uranium-238 into the fuel cycle, while ensuring an entirely new feed potential for the nuclear industry and easing reprocessing of accumulated waste, because one of serious claims to the nuclear industry is a large amount of resulting waste and incompletely solved task of its full disposal from the point of bringing the Earth to the zero radioactivity balance. It means that if we extract some radioactivity from the subsurface, we should put the same amount of it back without exceeding the natural radioactivity. The development of the fast reactor technology, we believe, will help us to solve this task. It should be attached to the technology of closing of the nuclear fuel cycle, which is also a part of our federal target program.

 

And the next step, day-after-tomorrow step of the nuclear power is thermonuclear power and the project we are implementing together under the international project ITER. However, under the approved federal target program we are unfolding a rather large work inside the Russian Federation to set up a corresponding experimental and test-bench basis with the focus on the staff training where we are ready to be absolutely open as well and invite our partners to the cooperation in all areas of new technologies of the nuclear power and infrastructure development, including training of personnel.

 

Yet another point I would like to discuss today is the expansion of use of the nuclear knowledge and expertise. Because in conditions of the world financial crisis nearly all governments have set a task that there should be found not only a way out of the crisis situation that has formed retaining old economic model. This is essentially important for Russia, and this is the task that has been formulated by the President of Russia and the Chairman of the Russian Government and we must implement structural changes to ensure not just restoration of our economy’s feed base but to ensure an innovative breakthrough. So in this respect, the Russia’s nuclear industry is faced with a special goal and we feel this special responsibility.

 

Like 60 year ago (this year the Russian nuclear industry is celebrating its 65-th anniversary), the nuclear industry still is the driver of the innovative development. When implementing the Atomic Project, a number of related industries have been pulled out by this driver/locomotive. Today, we are faced with the same task. So if you look at the Rosatom’s stand at this exhibition, you will see that it is fully devoted to five priority projects of the Russia’s economy development which have been set by the President of Russia.

 

One of these priorities is the nuclear power proper. The next priority is exploration of space and therein we are charged with a large-scale task of building a new class of nuclear power installations which have never existed anywhere in the world: a megawatt-class reactor. It’s more than one megawatt of power capacity we will be able to put into orbit. And this will give us different opportunities starting from interplanetary flights and finishing with the possibilities of various research, solving different tasks on the space orbit having at our disposal such amount of available power.

 

The third priority project is supercomputers and grid-technologies. And since our country invests large funds for Rosatom’s federal nuclear centers to develop supercomputers, and as far as we have a unique software potential, programmers and mathematicians, all this base, all this potential must work to support the development of the country’s economy and interaction with our partners. Therefore, close to our most powerful nuclear center in Sarov under the decision of our government an innovative industrial park has been established, and it is open for participation of foreign partners. And in the work of this industrial park we plan to use computer capabilities and human potential of the federal nuclear center (RFNC VNIIEF - editor’s note) as much as possible.

 

One more priority is development of medicine, and we have set large-scale tasks for ourselves today to maximize the use of the nuclear industry potential, radiation technologies for the modern medicine. One of the ongoing projects is the Russia’s contribution to mitigate the crisis of medical isotopes supply that has arose from shutdown for repair of several key isotope production reactors, of molybdenum, in the first place. I may say that today we are at the final stage of this project implementation. By the end of this year we will produce more than 1,000 curies of molybdenum in NIIAR (Research Institute of Atomic Reactors, Dimitrovgrad - editor’s note) in Ulyanovsk Region to be supplied to the Russian and foreign markets. By 2012 it will be 2,500 curies per week that would allow us rendering this service to the world market and ease the deficit we are having today when thousands of people cannot receive the necessary medical treatment in time.

 

One more area is superconductivity and energy conservation, energy efficiency; we have special round-table discussions for these issues. I think during these days we will have an opportunity to discuss it fruitfully.

 

The main thing I would like to conclude with, my distinguished colleagues, is that all these areas of our activities are absolutely opened in the terms of our strategic choice, which we once more confirm today. This is the choice of an open partnership, open strategic cooperation. That is why both the task of energy security and safety ensuring and the task of the nuclear industry’s being the driver of the innovative development in the world are not just a national specific task of an individual country. This is a global task of development of mankind and the world’s energy security. And we are glad to implement this large-scale task together with you, our partners, who are in this conference hall today.

 

Thank you

 

Sergey Kiriyenko,

Director General,
State Nuclear Energy Corporation «Rosatom»