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| Areva planning major investments in India | |
| PB Jayakumar & Nevin John / Mumbai July 13, 2009, 0:24 IST | |
Areva, the French nuclear reactor maker, is broadening its business plan for India with major investments in its strategic joint ventures with Bharat Forge, Tata Group, Bharat Heavy Electricals (BHEL) and Nuclear Power Corporation of India (NPCIL), though it is exiting from the power transmission and distribution (T&D) business in the country.
Areva, which is planning a large scale nuclear reactor forgings facility in India with Bharat Forge, will invest over Rs 2,000 crore in two shell companies, Sushil Kumar Chadda, advisor (energy) for Bharat Forge told Business Standard.
Also, the company said on Friday in a statement from Paris, “Areva has finalised the terms of a framework agreement with the Indian engineering company TCE Consulting Engineers (TCE), a subsidiary of Tata Sons. This agreement for the supply of engineering services will be signed shortly.”
In its JV with Bharat Forge, the Indian company will have 51 per cent stake in the first shell company, which will manufacture steel smeltings and forgings, while Areva will own a majority stake of 51 per cent in the second shell company, which will set up assembly lines for the finished nuclear forgings. Both the facilities will come up together at a coastal area. The partners have shortlisted Dahej in Gujarat, and Krishnapatanam and Visakhapatnam in Andhra Pradesh, as locations for the JV, which requires an area of about 200 acres, he said.
The JV will start production by 2012 and the partners are expecting to suppy 8-10 forgings in the first year of operations. “We are working out the final details and the joint venture agreement will be signed within a month,” he said.
The French major on Friday announced new development plans for India, including a proposal to build two new European pressurized reactors (EPR) each, with an output in excess of 1,600 Mw. It is in discussion with the Indian government to supply reactors for setting up a nuclear power park at Jaithalpur in Maharashtra. The government plans to build five such parks, each with an investment of Rs 40,000- 50,000 crore.
India’s civil nuclear power programme is ready for a takeoff following the country’s entry into the Nuclear Suppliers Group (NSG) after a three-decade ban. The nuclear power programme offers an opportunity worth $60 billion for the global nuclear industry, as India plans to add about 60,000 Mw capacity by 2032.
“Areva’s bid for the construction of two EPR reactors and these various agreements confirm the group’s desire to expand its activities in India, one of the world’s most dynamic economies which needs to rapidly increase its production capacity to meet its ever-growing energy needs,” the company said in a statement.
In June, Areva’s supervisory board approved plans to sell its T&D business to bridge a $15.5 billion funding gap in its nuclear power expansion programme. Areva T&D India, which is listed on bourses in the country, has a market capitalisation of Rs 7,300 crore.
K Ravi Kumar, chairman and managing director of BHEL said the company was in talks with Areva and other leading reactor makers for building nuclear reactors. Further, the company is planning a forging and castings joint venture and is in discussion with Areva and Bharat Forge. BHEL had already roped in UK’s Sheffield Forgemasters as technical partner in the venture.
Earlier, Larsen and Toubro (L&T) sources said it was in discussions with four global reactor majors, including Areva, for the engineering, procurement and construction (EPC) business in nuclear power. L&T, however, then signed cooperation agreements with GE Hitachi, JSC Atomstroyexport, Westinghouse Electric Company, LLC (Westinghouse) and Atomic Energy of Canada Limited (AEC).
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