France set to announce UAE nuclear energy deal
By James Kanter
Monday, January 14, 2008
PARIS: In a sign of accelerating interest in nuclear power, President Nicolas Sarkozy of France was expected to sign a deal Tuesday enabling Total, the big oil company, to join forces with the reactor-designer Areva and the utility company Suez to build power stations in the United Arab Emirates.
Sarkozy on Monday began a three-day tour of the Middle East with a trip to Saudi Arabia. He was scheduled to go to Qatar and the United Arab Emirates on Tuesday, where he was expected to sign the nuclear cooperation deal.
The establishment of commercial power reactors in the Middle East would be a new step for the nuclear industry. At the moment, Egypt and Israel are among countries in the region operating nuclear research reactors for activities like medical research and desalination. Iran has a nuclear power reactor, Bushehr, under construction using Russian technology.
The companies said Monday that they had reached a partnership agreement to submit a nuclear power plant project to the United Arab Emirates authorities and that local partners would take part. They said they would submit a proposal for an integrated nuclear power generation “solution” comprising two 1600 megawatt European pressurized reactors and fuel-cycle products and services.
Such a project would be a first for Total, which has long been a force in the oil market and is the largest company in the euro zone by market capitalization. The Total chief executive, Christophe de Margerie, has emphasized the growing difficulty of obtaining sufficient oil to meet global demand growth, and he has signaled an interest in diversifying its business into nuclear power.
“This will be a partnership between three important industrial companies, and it gives Total an opportunity gradually to develop an expertise in nuclear,” said Patricia Marie, a spokeswoman for Total in Paris. “We can bring our leadership in the Middle East, and our capability in managing huge projects.”
Marie said her company had been present in the United Arab Emirates for the past 80 years.
News of new nuclear construction in the Middle East comes amid renewed hopes for the industry in Europe after years of stagnation because of fears about the safety of the technology, its high cost, and a failure to find a long-term solution for disposal of waste produced by nuclear stations.
Last week the British government announced plans to refresh its fleet of aging nuclear reactors in what is expected to give a major boost to crucial players in the French nuclear industry, including Électricité de France and Areva, which said they would play a leading role.
The accord being overseen in the United Arab Emirates by the French government follows similar ones with Algeria and Libya and would mean new contracts worth billions of euros for French companies.
Under the deal in the United Arab Emirates, Total is expected to provide expert advice on running large projects, while Areva would build the reactors and Suez would run the power stations, according to Patrice Lambert de Diesbach, an energy analyst with CM CIC in Paris.
Diesbach also said the deal showed Sarkozy “using nuclear as a powerful lever to strengthen and even normalize international relations” in the region.
Cooperation on nuclear power is a pillar of the French president’s diplomatic pet project in the region – a Mediterranean Union gathering countries in North Africa, the Middle East and southern Europe into a bloc.
For the U.A.E., access to nuclear technology could allow it to export more of the oil it produces and rely on nuclear power for its domestic needs.