Fennovoima cancels supplier contract for nuclear plant

The Russian state-owned company said the decision was unilateral, without lending an ear to the RAOS Voima, because it said the project has progressed well and the co-operation between the participants has been well-established.

We reserve the right to defend our rights in accordance with the applicable contracts and laws. Fennovoima has announced its decision to terminate its supplier contract for the nuclear power plant with Rosatom on Monday, saying that the RAOS Project, the Rosatom subsidiary that was to deliver the plant, has experienced delays that warrant questioning its ability to see through the project.

The Russian war in Ukraine has led to the growing risks associated with the project, according to the Finnish nuclear energy company.

CEO Joachim Specht says everyone at Fennovoima is sad and disappointed. This is not what we wanted to do. We wanted to deliver this project. Needless to say, we won't accomplish that with this setup, he said in a news conference in Helsinki.

Rosatom remains a shareholder in Fennovoima with a stake of roughly 34 per cent in the plant supplier and both the design and licensing work at the construction site have ended with immediate effect, and co-operation with the plant supplier has been terminated with immediate effect. The rest of the shares in the company are owned by Voimaosakeyhti SF, a consortium of companies and municipal energy utilities of all sizes in Finland.

Specht stated in a press release that the termination of the engineering, procurement and construction contract will have a significant impact on the employees and supply chain of Fennovoima.

We will have people on the payroll, but we have to follow the change negotiation and reduce our staff by the end of the year. How many people will remain on the payroll? He said it was too early to give any accurate or credible figures on that.

Specht said that the company's focus is on preserving the construction site.

He said that the preservation of the site means first suspending activities related to our formal engineering, procurement and construction contractor and secondly to conclude, in a controlled and defined way, the activities Fennovoima itself conducts on the site, like the erection of the administration building.

It has to do a lot with collecting the relevant site data or relevant information in order to maintain or obtain a maximum level of information and to preserve the site for potential future activities. Both Specht and Esa Hrm l, the board chairperson at Fennovoima, underlined that the primary reason for terminating the cooperation was not Russia's invasion of Ukraine.

We base our decisions on facts and the fact that this contract has been suspended due to delays and inability to deliver. Hrm l It s not a single event, Specht said that the war has increased these risks. It has happened for years and the lack of capabilities and delivery capabilities has accumulated. H rm l revealed that approximately 600 700 million euros have already been poured into the project, with each stakeholder contributing a share equivalent to their stake in the nuclear energy company.

The Finnish Ministry of Economic Affairs and Employment on Monday praised the decision to terminate the delivery contract.

The Ministry of Economic Affairs and Employment considers the owner's decision regarding the plant delivery contract to be justified and consistent. The termination of the contract is an acceptable measure in this situation, it said in a press release.