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Energetic Competition

By admin • Jun 10th, 2010

As the region’s population rises and demand for energy goes up, key players in the civilian nuclear industry are looking to enter the market.



The day the U.A.E. president, Sheikh Khalifa bin Zayed al-Nahyan, signed an agreement with his South Korean counterpart, Lee Myung-bak, in December for nuclear power facilities, it represented a significant milestone for Koreans as well as Emiratis.
The agreement provided for Korea Electric Power Corporation to build four nuclear power stations in the next 10 years, setting the U.A.E. on the path to become the first Arab nation to have nuclear energy on a commercial scale.
But the agreement was just as significant for the Koreans. The plants in the Emirates will be the first built by a South Korean firm outside its own country. Korea Electric beat out a U.S.-Japanese alliance in GE-Hitachi and French firm Areva to win the bid. In the growing but competitive world of nuclear power generation, the Koreans were announcing their intention to compete with mainstays of the industry.
Decades ago, competition in the nuclear energy industry was strong. There were many companies capable of building facilities.
But the Chernobyl and Three Mile Island accidents made politicians and decision-makers wary of allowing more plants to be built. As players pulled out of an industry they viewed as fraught with political risk, there was considerable consolidation in the market, leaving just a handful of companies to manufacture and maintain reactors.
But with renewed emphasis on non-carbon energy sources, and a recognition that the industry has had a clean record for nearly 30 years, countries are once again looking seriously at nuclear power to meet their growing demands.
In the Middle East, Kuwait, the U.A.E., Jordan, Saudi Arabia, and Syria have all expressed keen interest in commercial nuclear energy programs, and the International Atomic Energy Agency expects many more countries to join the ranks of nuclear energy producers in the next two decades.
“Nuclear power is enjoying growing acceptance throughout the world as a stable and clean source of energy that can help to meet energy needs and to mitigate the impact of climate change,” the agency’s director-general, Yukiya Amano, said in April.
“More than 60 countries are considering introducing nuclear power to generate electricity. We expect between 10 and 25 new countries to bring their first nuclear power plants online by 2030.”
That means the handful of reactor manufacturers are moving quickly in the region to secure deals.
As populations in the Gulf grow, the need for energy grows more rapidly than it does in milder and wetter climates. Extreme temperatures and intensive water desalinization methods mean energy required per person is far greater in countries such as the U.A.E. and Saudi Arabia.
At the same time, oil producing states are moving towards energy diversification as both a means of conserving oil and gas for future exports and as a ways of ensuring they remain competitive as alternative energies become more viable.

In 2006, the G.C.C. said it was examining civilian nuclear technology. The U.A.E. followed one year later with its own study after it saw rapidly growing energy demand associated with its property boom and subsequent rise in population.
The Bush Administration signed memoranda of understanding with Bahrain, Jordan, and Saudi Arabia, the initial step in a cooperation agreement with the U.S.
This year Saudi Arabia appointed its former commerce minister Hashem bin Abdullah Yamani to head up the King Abdullah City for Nuclear and Renewable Energy project and signed agreements to explore the use of nuclear energy with firms in three different countries, according to a source familiar with the matter.
The Syria foreign minister, Faysal Mekdad, told the Associated Press in January that his country was pursuing nuclear power generation in order to meet the needs of a growing population. Syria’s energy supply is about two-thirds of its required needs, leading to shortages in recent years. The Russian energy minister, Sergei Shmatko, said his country was studying the market potential in Syria.
Jordan has significant uranium reserves, making the prospect of nuclear energy even more attractive. In May, the head of the Jordan Atomic Energy Commission, Khaled Toukan, said the government was talking to three firms competing to build plants in the country. The Jordanians are also expected to approve a uranium mining deal with Areva this year.


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