INTERVIEW WITH SERGEY KIRIYENKO
During the exclusive interview with ITAR-TASS Sergey Kiriyenko, Director General of Rosatom, Russia’s State Nuclear Energy Corporation revealed the achievements of 2013 and the goals set 2014.
– What place does the State Corporation Rosatom take in the international arena?
– Rosatom is in the leading place in the world. However, one should treat its competitiveness with respect. You need to understand your own strengths and the strengths of the competitors. Rosatom is truly the leader of nuclear power engineering, and I have all the rights to state that. We build more nuclear power plants in other countries than anyone else, which is an important indicator of trust on us. As of today Russia is the leading positing in building of NPPs inside the country and in the world. Moreover, we take the first place in the world in terms of quantity of uranium enrichment and we are the absolute leader in the world in the field of fast neutrons (FN) reactors. In addition, Russia is the only country in the world possessing a fleet of surface ice-breakers. Therefore, we can rightfully be proud of our capabilities and our leading positions. But we should not be complacent. It is important to understand the strengths of the competitors, and this is what to which we give priority today.
A few years ago during the analysis of the situation in the markets we understood our weakness in securing sufficient reserves of low-cost uranium. Because the main reserves of Russia were significantly exhausted during Soviet era. Therefore, we implemented a large project on geological exploration within the country. This way we increased the uranium reserves in Russia by six times and acquired a number of very effective uranium deposits in Kazakhstan, Africa, Australia and even in America. At the moment our company Uranium One Inc. takes the first place in the world in low-cost uranium reserves. We are now secured in uranium reserves.
We made it our goal to develop the nuclear mechanical engineering division. At the moment one we can say that our Atomenergomash is one of the three largest power machine building companies in Russia, which is capable to supply five sets of equipment per year. Therefore, I believe that we should be proud of how far Russia has come. Our nuclear power sector is the best in the world. However this pride should not stand in the way of seeing our own shortcomings, otherwise our leadership will end soon. We should not deny that we have strong competitors – the Americans, the French and the Japanese. The Koreans and the Chinese are developing rather dynamically in this area, and they will do all they can to catch up with us. Securing and maintaining leadership is a serious task and a difficult one too.
– The contract for construction of Hanhikivi-1 in Finland has been signed recently. What significance does this project have for Rosatom?
– This is indeed an interesting project, even though this country is not new to us. During the Soviet era our country had the experience of building nuclear power plant in Finland, the Loviisa NPP. For many years this power plant was acknowledged to be the most efficient and secured nuclear power plant in the world. It goes without saying that Finland is situated closer to and is politically oriented more towards the European Union and the USA. This means that the political choice is not in favour of Russia. Initially we were not even invited to participate in the tender. But we ourselves took the initiative and challenge. This is why our success was a real surprise for others. It should be noted that this job is not an agreement at the governmental level. This is a real business and the Investment comes from private sector – a syndicate of private industrial companies and banks who ordered a nuclear power plant. For me, it is always important when the decisions are made based on business perspective and logic.
The project of Hanhikivi-1 NPP creates high interest. The nuclear power plant will be constructed using the new 3+ generation technology. Setting up of a Russian made nuclear power plant with post-Fukushima security systems in the European Union very significant for us.
Besides construction of the nuclear power plant in Finland we signed an additional fuel supply contract. In accordance with the regulations of the European Union this agreement is signed for ten years with the provision of further extension. This project will be significant not only for the designers and engineering companies but for fuel and excavating companies as well.
– How did Rosatom do in performing obligations in the external market this year?
– The special feature of nuclear industry is its long-term commitment. For example, the power plant in Finland will be constructed for ten years. In ten years it will start operating and will be operating for eighty years. Then comes the stage of decommissioning. This means that all the decisions we are discussing right now will be made for hundred years. The horizons are longer than human life. Therefore the questions of trust and reputation become the key issues. Proper performance of obligations assumed under the contracts is very important for us. This year we performed a number of landmark projects.One of them is Bushehr NPP in Iran. Nobody in the world has ever done anything like that. We took a power plant, construction of which was started by the Germans more than 30 years back and it was simply abandoned. When our specialists started working in Bushehr plant, the dome had a hole from a direct hit of a missile. Generally speaking, no one in the world has ever implemented a project like that – construction of a new power plant on the infrastructure of an old construction. Nobody, but Russian specialists would have been able to succeed.
Despite the fact that this project was fully coordinated with the UN and approved by the Security Council, it was not an easy task due to the pressure exerted on us. Because of the economic and political situation our Iranian partners expressed doubts about completion of the plant construction. But regardless of all technical difficulties and counteractions, we succeeded. This year I heard many times not only from the Iranian colleagues, but also from others: “If Russia built Bushehr, we can trust that they are capable of handling any technical difficulties”. We keep our words even in very difficult situation.
Another important project we commissioned this year is the 1st power unit of Kudankulam NPP in India. At the moment it is running on 50% capacity. We are planning to commission the second power unit of the Indian power plant in the middle of 2014. At the moment we have contracts signed for 20 power units abroad and we are building 9 in Russia.
This year we won the tender not only in Finland, but also in Jordan. Planning works are taking place at the site of the first NPP in Bangladesh, and casting of the first concrete of the fourth power unit of Tianwan NPP in China was accomplished. This is quite significant. China is able to construct nuclear power plant on its own. Moreover, the Americans and French are building NPPs for China. We often heard such a hypothesis that the Chinese accept one power plant from each country, examine the technologies and following that they build NPPs themselves. But the fact is that the Chinese partners asked us to continue our job, while they had their own project attached to the site, which says a lot. Because this decision by Chinese is not made based on advertisement rather our power units have been acknowledged to be the best among all nuclear power units, presently in operation in the territory of China, the most efficient and secured ones. Another significant event of the year is casting of the first concrete of the first NPP in Belarus.
– After completion of the HEU-LEU project, what is the volume of contracts you managed to receive in the American market?
– True, it has ended. Russia has fully performed its obligations during last 20 years. The most important thing we had to do is not to lose the U.S. market. Because this is one of the biggest markets particularly for the nuclear industry. We were successful in doing that. As of today, the volume of contracts concluded with the American energy companies stands at 11.5 billion dollars of which 5.5 billion dollars directly with the energy companies, the owners of the NPPs and another 6 billion with a large company USEC. We have not only secured our presence on the American market, but also gained trust of the energy companies. In the nuclear industry reputation means everything. We are expanding the supply volumes, and at the moment considering possibility to go further with the technology chain and supply not only enriched uranium, but to supply fuel assembly as well. The problem of fuel production for the western design reactors is technologically solved, and at the moment Russia is able to produce fuel not only for its own power plants, but also for the American ones.
– Tell us about the BREST and BN projects. Why is such importance given to these projects?
Fast neutron reactors are definitely a breakthrough to the next generation technologies. In about ten years increase in commercial utilisation of FN reactors will begin, we presume. Russia is an obvious leader in the world in these projects.
The so called fast reactors are definitely a next step in nuclear power engineering. However the question of which coolant to be used remains open. In the framework of the Proryv programme we consider several projects. There is BN reactor with sodium coolant and BREST with lead coolant. At the moment this project is undergoing expert review, and we are getting ready to construct of a power plant in Seversk, in Tomsk region. At the same time we are considering few other projects with smaller capacity with a lead-bismuthic coolant. Important enough that at the moment Russia is an undisputable leader in all the three fields. This will allow us to make the right choice.
When we were expanding the programme of serial construction of nuclear power units, many told us that it has been a while since anyone built this way, back in the Soviet times, and that we will not be able to do it. Even if we are, it will take much longer time and will cost much more. It is important that we started meeting the deadlines at any cost, and were not always successful. In addition, we had to exercise strict control for every cent spent, because of the risk of exceeding the estimates. Later we learned to meet the deadlines and stay within the estimated cost. Many of the power units I named were commissioned below the estimated cost. Additional costs may arise during pre-commissioning activities of BN-800, however according to our preliminary estimate we are able to commission BN-800, saving 10 billion Rubbles of the estimated costs approved by earlier expert appraisal.
Generally speaking, we are performing the main task we need for competitive power – to manage deadlines and costs, and be able to reduce both. This is the objective we set for all the new projects.
– Rosatom continues entering new markets including that of heat engineering. What is the desire behind to work in the out-of-the-industry markets?
– Speaking about the values we formulated for ourselves, we have one – being one step ahead. Not only ahead of the competitors, but a step ahead of ourselves. From this point of view the competences, skills, qualification and experience of our companies, which may be used in many sectors of national economy are very important to us. Moreover, this creates additional workplaces. Many of our companies are located in mono-towns and there are no other workplaces. We set a task for our mechanical engineering division- Atomenergomash, that the share of projects of heat engineering must comprise 35-40%. However the main share of orders continues to be in the nuclear sector. The same goes for the engineering companies. If they are capable of constructing a nuclear power plant, it will not take much effort to construct a heat power station.
– It is impossible not to bring up the topic of nuclear legacy. What is done to solve these problems? Especially in the north of Russia?
– Do you expect me to say that large territories are polluted with radioactive waste? No, it is not true. They had indeed trashed up the north a while ago, but the trash polluting the regions of the Far North is mostly barrels from solar oil and abandoned equipment.
The decision was made that Rosatom will take over the responsibility for servicing of atomic submarines (ASM), assigned from the Navy fleet. We are about to complete this project. Out of 200 ASM 195 have already undergone servicing and rest five are in the final stage of the process. In the past years our specialists had been able to reduce the time fore processing and servicing of the ASM to half and it became 30% cheaper.
-You devote much efforts to implementation of the manufacturing system of Rosatom. What is the aim of this project?
– The main value of the nuclear sector is the priority of security. I believe that it is followed by the priority of efficiency. We have to offer high quality, reliability and safety. This is why we watched carefully experience of the best in the world. The best world experience is probably the production system Toyota. When we spoke to the Toyota specialists they acknowledged that during creation of their production system they borrowed quite a bit from organising of labour in the Soviet Union. Therefore, for us it is not just borrowing, it is a combination. At the moment the groups of the production system of Rosatom operate at every factory, construction bureaus and even offices of the management companies. Their task is to find effective solutions for our most complex and labour-intensive projects with the existing possibilities. Projects of the production system ensure all our commissioning objectives. When any problems or malfunctions arise during construction of the nuclear power plants, it greatly affects both the time and costs.
– What plans does Rosatom have for 2014?
– We have developed the strategy for 2014. We have a big and very serious work in front of us. The coming year is 60th anniversary of nuclear power engineering. In the summer of the coming year it will be 60 years since the first nuclear power plant in the history was launched in Obninsk. Its capacity comprised only 5 MW. It was humorously called “the toy of the physicists”. Those days nuclear power engineering was developed for other goals – defence. But now a days nuclear power engineering is a dynamically developing reality for the world economy. Therefore, Russia, as a country where nuclear power engineering was created, bears a special responsibility. We need to accomplish a lot in order to use that unique legacy we received from the creators of the nuclear sector in the USSR. I believe that today’s team of the nuclear sector in Russia is capable to carry on this baton and meet the challenges we face. This is first of all ensuring security, creation of the nuclear shield of our country, for which Rosatom bears all the responsibility. After the Fukushima disaster we have been able to increase our order volume two fold in the international market. And I believe that this is not the limit. We expect four commissioning in the coming year, of which former Soviet Union could not dream even.
January 16 2014