The Romanian Ministry of Energy, holding an 82% stake as the main shareholder, instructed Nuclear Electrica (SNN), through a notification sent to investors, to proceed with the transaction where their joint venture (JV) partnership with private firm Nova Power and Gas (NPG) would acquire the parcel of land intended for developing the initiative—a small modular reactor (SMR) facility in Doicesti—from NPG itself.
When the notice was dispatched to stakeholders prior to the close of trading on March 21, the value of SNN’s stock fell by 4%.
In January, officials from the Ministry of Energy refrained from supporting the protocols for purchasing the land during the shareholders’ assembly, as reported.
Profit.ro
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The partnership deal finalized in September 2022 between SNN and NPG apparently stipulates that the land will be sold based on its book value (along with additional expenses involved), instead of its current market value as suggested in the document submitted for approval to SNN’s shareholders, reports Profit.ro.
The state-owned Nuclearelectrica (SNN) and Nova Power and Gas (NPG), which is controlled by Romanian entrepreneurs Teofil Mureșan, Simion Mureșan, and Marian Pantazescu, established a 50:50 joint venture called Ropower Nuclear—a project company—in September 2022. The purpose was to develop a small modular reactor (SMR) project anticipated to have costs ranging from €4-6 billion.
NPG was chosen by Nuclearelectrica due to owning the location of a decommissioned coal-fired power station in Doicesti, which was deemed suitable for the project thanks to its pre-existing infrastructure. Although NPG operates within the energy sector, its experience with a venture of this scale—the small modular reactor (SMR) initiative—and its financial capabilities (along with the assurances it can offer) fall short when contrasted with those of Nuclearelectrica.
The amount that Ropower Nuclear has agreed to pay NPG for the parcel of land will reflect the current market value, established under typical market circumstances and adhering to all pertinent legal requirements, as stated in the document shared with Nuclearelectrica’s shareholders for approval at their general assembly scheduled for April 8.
The cost will encompass all expenses NPG has covered regarding the land, such as financial charges, capital investments, costs associated with enhancements, upgrades, cleanup efforts, and modifications made to the property from when NPG acquired title until the nuclear power plant site transfers from NPG to the project company. This also includes expenditure for maintaining, conserving, and managing the land, which occurred after the contract was signed but before transferring the NPG property to the project entity. It should be noted that the project firm might ask NPG to furnish documentation substantiating these figures, ensuring they aren’t duplicated within the previously stated evaluation document.
iulian@romania-insider.com
(Photo source: Nuclearelectrica.ro)