S. Korean nuclear plant operator seeks new business opportunities abroad

Lim Chang-won Reporter Posted : 2018-06-08 15:16 Updated : 2018-06-08 15:16
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[Courtesy of Korea Hydro & Nuclear Power]

SEOUL -- To head off a challenge posed by a sudden policy shift, the operator of South Korean nuclear power plants vowed to find a new growth model abroad by exporting technology and business know-how to Slovakia and other emerging markets.

Korea Hydro & Nuclear Power (KHNP), which depends heavily on sales of electricity produced at 24 nuclear reactors at home, has been hit by falling profits, as President Moon Jae-in pushes ahead with a strong campaign to replace fossil-fueled power plants with clean and renewable energy sources.

KHNP's net profit fell from 2.47 trillion won ($2.31 billion) in 2016 to 861.8 billion won in 2017. The state-run company predicts a dismal performance this year.

KHNP CEO Chung Jae-hoon said his company has been in crisis with a new energy policy forcing it to work out an independent survival tactic, vowing to find new business opportunities in "strategic" markets such as Czech Republic, Slovakia, Poland and the Philippines.

Initially, President Moon Jae-in's policy of phasing out nuclear power plants clouded prospects for South Korea's nuclear industry. However, Moon eased his stance, promising to "actively" support exports of home-made reactors. The government has mapped out a new energy roadmap calling for an injection of about 110 trillion won into renewable energy by 2030.

KNHP and Korea Electric Power Corp. (KEPCO) are now locked in the race with France, China and Russia to win a Saudi contract on building two reactors. As the world's biggest crude exporter, Saudi Arabia seeks to diversify energy supplies and reduce its dependence on hydrocarbons.

KEPCO, a state utility company which produces home-made nuclear reactors, has led a consortium of KNHP and other South Korean firms to build power plants in the United Arab Emirates under a $20 billion contract.

After Saudi Arabia, KEPCO's next target will be a nuclear power project in the Czech Republic. However, Chung said his company would make its own way.
"KHNP has its own export capability and project financing ability," he said.

Chung said KNHP would try to make profits from consulting, maintenance and data management. "The hardware business is our cash cow right now, but from now on, we will try to become a company that can provide consulting services and big data in emerging countries, based on 35 years of know-how," he said.