BHEL and L&T Secure Steam Generator Supply Contracts for Kakrapar Nuclear Power Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--Nuclear Power Corporation of India Limited (NPCIL) (Mumbai), a state-owned nuclear power producer, recently awarded contracts for steam generators to Larsen & Toubro Limited (BSE:500510) (L&T) (Mumbai) and Bharat Heavy Electricals Limited (BSE:500103) (BHEL) (New Delhi). The equipment will be used for the third and fourth pressurized heavy water reactors (PHWR) to be developed at the Kakrapar atomic power station in Gujarat. Each of the reactors will have a capacity of 700 megawatts (MW). L&T and BHEL have secured individual contracts worth $67.8 million to design, engineer and manufacture four steam generators, which will be part of the primary cycle in the reactors.

The project is NPCIL's first to set up two 700-MW nuclear reactors that have been completely designed and developed in India. Construction is expected to commence by the end of this year. The steam generators for the 700-MW nuclear reactors will be the largest ever built indigenously. A steam generator, which performs the function of a heat exchanger, converts water to steam from the heat generated by fuel reactions in the reactor core.

BHEL will engineer and construct the 700-MW steam generator units based on the design of the 540-MW generators developed by the firm for NPCIL's Tarapur nuclear power plant. BHEL has designed, manufactured and commissioned nearly 80% of the components for NPCIL's 4,120-MW installed nuclear power capacity.

BHEL is also in the process of developing a complete conventional power island for the 500-MW fast breeder reactor being set up by Bharatiya Nabhikiya Vidyut Nigam Limited (BHAVINI) (Kalpakkam, Tamil Nadu) in Kalpakkam near Chennai.

The steam generators for the Kakrapar project will be designed, constructed and tested at BHEL's manufacturing facility in Trichy, Tamil Nadu. The equipment will adhere to ASME SEC III standards. BHEL will also carry out stress and thermo-hydraulic analysis for the project.

BHEL and NPCIL recently signed an agreement with GE Hitachi Nuclear Energy Incorporated (Wilmington, North Carolina) to initiate the development of new nuclear power plants in India. Resource planning and feasibility studies are under way to set up advanced boiling water reactors.

BHEL has augmented its annual power equipment manufacturing capacity to 10,000 MW and plans to increase it to 15,000 MW by the end of 2009 and to 20,000 MW by December 2011. BHEL has also been exploring opportunities to set up operations overseas. The company, recognizing the potential for nuclear equipment manufacturing in Kazakhstan, recently opened a marketing office in the country. BHEL, which has an export target of $2.02 billion for this year, is looking at expanding operations to Kyrgyzstan, Belarus, Moldova, Turkmenistan, Ukraine, Georgia and Armenia.

L&T, which has supplied nuclear power equipment for NPCIL's PHWR reactors in Chennai, Narora, Kakrapar, Kaiga and Tarapur, is also partnering with Atomic Energy of Canada Limited (AECL) (Ontario, Canada) to analyze the suitability of the ACR-1000 reactor for Indian conditions. L&T has also signed a memorandum of understanding with AECL to manufacture equipment for the AP-1000 reactor. The AP-1000 reactor, considered to be one of the world's most economical reactors, can be constructed and brought into commercial operation within 36 months.

NPCIL has 17 commercially operational nuclear power stations in the country. The Kakrapar atomic power station, which is one of the primary nuclear reactor sites, has two operating units based on the PHWR technology. The 220-MW KAPS-I reactor was commissioned in 1992 and started power generation in 1993. The second unit, KAPS -- II, with the same capacity as KAPS-I, began commercial operations in 1995. As on February 2009, both units have cumulatively generated about 38,948 million kilowatt-hours of power. KAPS-I was conferred with the "World's Best PHWR" award in its category by the CANDU Owners Group Incorporated (Toronto, Ontario) in 2003.

NPCIL recently announced plans to seek $4 billion in debt from international markets to fund its nuclear power project in Jaitapur, Maharashtra. The project, carried out in association with Areva SA (EPA:CEI) (Paris), will be based on a debt-to-equity ratio of 70:30. NPCIL has received bids from 15 international banks with commitments of around $10.57 billion. Industry experts see the global interest in India's nuclear power industry as a good sign, as India plans to add 60,000 MW of nuclear power generation capacity by 2032.

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