'Nuclear feud' deepens between Korea, UAE
The Barakah nuclear power plant
By Nam Hyun-woo
A feud is deepening between Korea Hydro & Nuclear Power (KHNP) and Emirates Nuclear Energy Corporation (ENEC) of the UAE over the latter's Barakah Nuclear Energy Plant, following the former's “unilateral” decision to replace its workforce dispatched to the plant.
After ENEC issued a written complaint over the decision to KHNP's parent firm, Korea Electric Power Corp. (KEPCO), lawmakers and industry officials said Wednesday that KEPCO's ongoing bid to become a long-term maintenance service provider of the plant will likely be affected, and the Korean power company may have blown its chance to win the 3 trillion won deal.
Korea Electric Power Corp. CEO Kim Jong-kap
According to Rep. Choi Yeon-hye of the Liberty Korea Party, ENEC CEO Mohamed Al Hammadi sent a letter to KEPCO CEO Kim Jong-kap, Jan. 15, to complain about KHNP's recent replacement of workers deployed at the Barakah plant.
“I am addressing this letter to inform you of the severity and the critical risk of a unilateral decision taken by KHNP to withdraw critical expert resources away from Barakah,” Al Hammadi wrote.
“I am shocked to be informed by my team that a significant number of experienced KHNP people have immediately departed the Barakah project and returned to Korea, and this was done with little prior notification.”
Following a 2016 operating support services agreement, KHNP has been sending an average of 200 employees to the plant every year to support its operation until 2030. The deal was worth $920 million.
Emirates Nuclear Energy Corporation (ENEC) CEO Mohamed Al Hammadi / Captured from ENEC website
According to KHNP data submitted to Choi, 152 officials at the UAE plant returned to Korea and 138 have been newly deployed as of March 29. The returned employees include key officials in charge of the power plant's operation.
KHNP said the replacement was done as a “regular workforce reshuffle” which does not require prior consultation with ENEC.
“After the letter, the KHNP explained the reason of replacement, and smoothly addressed the UAE's misunderstanding,” it said in a statement.
Despite the explanation, concern is growing that the KHNP's reshuffle may aggravate KEPCO's bid to become a long-term maintenance provider at the plant, a deal worth trillions of won.
“Today, I am informed about this significant departure of experienced KHNP resources, which comes at a critical time in our schedule; precisely when the Barakah plants require commercial negotiations on strategic projects such as the LMTA (long-term maintenance agreement) are about to be concluded,” Al Hammadi wrote in the letter.
Korea Hydro & Nuclear Power CEO Chung Jae-hoon
Separate to KHNP's existing support deal, KEPCO and another affiliates are bidding to win the long-term maintenance deal. By providing maintenance services for the plant for up to 15 years, the service provider can earn up to 3 trillion won.
Initially, ENEC was expected to select the service provider in a closed deal with KEPCO, which built the Barakah plant. However, ENEC changed it to an open bidding in 2017, with firms from Korea, the U.K., and the U.S. currently vying for the lucrative deal.
“With the unilateral reshuffle, KEPCO has received written complaints, but the power firm is trying to downplay the complaint as a misunderstanding,” Choi said. “This may aggravate the chance of KEPCO winning the long-term management deal.”