According to multiple wire service reports in the Middle East, the latest schedule released by the Saudi government to bidders to build two full size commercial light water type nuclear reactors calls for best and final offers (BAFO) from four companies to be submitted July 1st. The original date for best and final offers was December 2023, then the date was pushed to this past April, and now it is due July 1st. Given the mercurial nature of the leadership in Saudi Arabia, there is no guarantee that date will stick.
The Duwaiheen nuclear power plant will be developed using a traditional design-and-build model. It is expected that the bidders will focus on the requirement in the tender for two 1.4 GW PWR type commercial reactors. The project is located on a coastal site that sits on the Persian gulf in between the borders of Qatar and the UAE. The four bidders for a contract to build Saudi Arabia’s Duwaiheen nuclear power plant are;
– China National Nuclear Corporation (China)
– EDF (France)
– Korea Electric Power Corporation (KEPCO, South Korea)
– Rosatom (Russia)
Three of them are state-owned enterprises. South Korea’s bid is supported by the current government.
In March 2022, Saudi Arabia announced the establishment of a holding company, the Duwaiheen Nuclear Energy Company, to develop nuclear power projects in the country to produce electricity, desalinate seawater and support thermal energy applications.
Project Management Consultants
Duwaiheen Nuclear Energy Company received three bids for the project management consultancy package of the nuclear plant project last year. Two of the three bidders have had previous engagements with the Saudi nuclear energy project. Reportedly, the following companies submitted proposals for the contract:
- Atkins (UK/Canada)
- Worley (Australia)
- Assystems (France)
Why the Delays in the BAFO Date?
The delays in the BAFO date are tied to regional geopolitics. Saudi Arabia is believed to be using its nuclear power plant project, along with its plan to enrich uranium, as a bargaining chip with the US government. The White House is pushing for the normalization of relations between Israel and Saudi Arabia.
A multi-part plan involving US support for the Saudi nuclear program, a US military security agreement, Saudi diplomatic recognition of Israel, and a two-state solution for the West Bank and Gaza, are all part of a proposed grand bargain.
However, as if hostilities continue between Israel and Hamas in Gaza, and Israeli PM Netanyahu’s iron opposition to a two-state solution, also continues, the deal won’t come to fruition any time soon.
Help Saudi Arabia Wants from the US with Its Nuclear Program
In addition to US technical support in managing the construction, operation, and regulation of the two commercial nuclear reactors, a key focus of the Saudi nuclear program is to build a uranium enrichment plant.
Numerous proposals have been offered to put in place safeguards regarding the output of the plant. One of them is for Saudi Arabia to hire CENTRUS, a US firm that produces enriched uranium, rather than building their own plant.
Options for hiring Westinghouse to build reactors for Saudi Arabia aren’t likely to be accepted since there is no 123 Agreement with the US and the firm was not invited to bid on the original tender for that reason.
US Officials Diplomatically Optimistic
That hasn’t stopped US officials from saying that the deal is nearly complete banking on Israel accepting a multi-phased peace plan proposed by President Biden last month.
US Ambassador to Saudi Arabia Michael Ratney said last month that the US and Saudi Arabia were on the verge of a historic agreement, which, if completed, would see a path to Palestinian statehood as well as the establishment of diplomatic ties between the Kingdom and Israel.
“We tend to overuse the word historic, but I think taken as a whole, this package of agreements would be truly historic.”
“But as part of that, there’s a role for the Palestinians. The Saudis have made clear that that’s a requirement of theirs and we as well have our expectations… there has to be a path forward for statehood for the Palestinians,” Ratney said in an interview with a wire service.
Ratney said that talks on a Senate-ratified treaty between the US and Saudi Arabia would make it a formal agreement that does not depend on a particular US administration.
“It would be an enduring agreement, not between an administration or government, but between two countries. And that brings certainty: it brings certainty to us; it would bring certainty to the Saudis as well.”
Ratney said details of the security arrangement and comparisons to the US-Japan alliance, which allows for US military bases on Japanese soil and a commitment from both countries to defend one another in the event of an attack, were still being discussed.
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UAE Plans Tender For Second Nuclear Power Plant
Reuters reports that the UAE Government is preparing to issue a tender for the construction of a second nuclear power plant. The government is expected to seek bids in 2024–2025 for constructing four new reactors. The tender could be issued in mid-to-late 2024, with construction beginning as soon as possible so that the new plant can become operational by 2032. That’s a much faster schedule than for the first four UAE reactors that are now in revenue service.
The UAE completed the development of four 1400 MW PWRs supplied by South Korea. The first unit broke ground in 2012 and the fourth unit entered revenue service earlier this year.
It isn’t clear how many reactors the UAE wants to build or whether South Korea would have an inside track to build them. Reuters reported the tender would be open to any potential bidders, including U.S., Chinese and Russian firms, adding that South Korea would not be treated by the UAE as a preferred bidder.
Separately, Reuters also reported the United Arab Emirates has approached European nations including the UK to gauge their interest in the Middle Eastern state investing in their nuclear power infrastructure. As part of its outreach, the UAE has discussed the idea of state-owned Emirates Nuclear Energy Company (ENEC) becoming a minority investor in European nuclear power asset.
The UK is particularly interested in investments in the Sizewell C project after it booted China out of its 20% equity stake on “security issues.” Sizewell C is to be two 1650 MW EDF EPR nuclear reactors. The project is expected to cost about $20 billion according to current estimates.
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- Source: https://energycentral.com/c/ec/saudi-arabia-kicks-request-bids-two-reactors-july