Russia's TVEL Signs $780 Million Contract with India for Uranium Supply of 2,000 Tons

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Russian nuclear fuel supplier TVEL Corporation (Moscow) will sign an agreement with India to provide fuel for the latter's nuclear power plants. The contract is valued to be worth about $780 million and is expected to be signed in Mumbai. As part of the agreement, TVEL Corporation will supply 2,000 tons of uranium pellets to India. With this deal, Russia will be the second country to enter into a nuclear-supplies deal with India and also the first country to commence nuclear fuel trade with India. In December last year, French nuclear energy company Areva SA (EPA:CEI) (Paris, France) signed an agreement with India's Department of Atomic Energy to supply 300 tons of uranium as feed for the nuclear reactors in the country.

Nuclear Power Corporation of India Limited (Mumbai) selected TVEL as a fuel supplier after extensive talks with companies in Africa, Kazakhstan and Canada. Russia has been working with India to develop the country's nuclear power program. In December last year, Russia signed an agreement with India to develop four reactors at the Koodankulam nuclear plant in Tamil Nadu. Russia is also completing the construction of two reactors at the site.

TVEL Corporation, part of the Rosatom Nuclear Energy State Corporation (Moscow, Russia), a nuclear regulatory body, has interests in nuclear-fuel mining, exploration and processing. TVEL consists of several large Russian companies that deal in uranium mining, the development of nuclear technology, and the engineering and manufacturing of nuclear power plant equipment. The enterprise produces nuclear feed for water-water reactors, uranium-graphite reactors and fast neutron reactors. The range of water-water reactors includes VVER-400, VVER-1000, boiling water reactors and pressurized water reactors, while the uranium-graphite reactors consist of EGP-6, RBMK-1000, Chinese experimental fast reactors and RMBK-1500. The company also supplies fuel to propulsion power installations and research reactors. TVEL supplies fuel to 30 research reactors and 73 commercial nuclear plants worldwide. The company accounts for 17% of the fuel used in commercial nuclear sites globally.

In October last year, after the Nuclear Suppliers Group (NSG) waived the 34-year nuclear trade embargo on India, the country signed a nuclear deal with the U.S. The NSG had banned nuclear trade with India after the country test fired nuclear weapons in 1974. India signed the agreement to develop nuclear technology for civilian use, but refused to sign the Non-Proliferation Treaty, which prohibits the use of nuclear technology to develop weapons. The NSG, however, granted a special waiver to India that allowed the country to continue development of nuclear weapons without international interference. India has also agreed to the International Atomic Energy Agency's (Vienna, Austria) regulation of on-site inspection of civilian nuclear power plants. India recently signed an agreement to allow officials from the United Nations to inspect civilian nuclear sites. Of the 22 nuclear power plants, India will allow access to 14 locations by 2014.

India's three-stage nuclear power development program hopes to bridge the 17% power demand-supply gap in the country. India has plans to build 28 new nuclear reactors to meet the target of additional power generation capacity of 40,000 MW by 2020. Steady and sustained nuclear feed is critical for the success of the nuclear power program. Talks are also in progress with Uzbekistan and Mongolia to procure additional nuclear fuel. It is estimated that the nuclear power sector in India could attract investments of more than $27 billion in the next 15 years, increasing the contribution of nuclear energy to the national grid to 5-7% in the next 20 years.

Industrial Info Resources (IIR) is a marketing information service specializing in industrial process, energy and financial related markets with products and services ranging from industry news, analytics, forecasting, plant and project databases, as well as multimedia services.