Joint venture to be finalized for Alstom, NPCIL and BHEL

Green design: Alstom’s new $300 million ‘green’ turbine factory on the shores of the Tennessee river in the US.

French power equipment major Alstom, the turbine supplier to a third of the nuclear stations worldwide, is on track for making inroads into the Indian nuclear equipment sector.

Negotiations are close to conclusion for a tripartite venture with the State-owned NPCIL and BHEL for executing the conventional island portion (or the non-reactor part) of upcoming nuclear projects. With this development, the Paris-based firm is eyeing a string of contracts in the country. Alstom is expected to have a 33 per cent stake in the proposed three-way joint venture.

“Discussions (for the venture) have been finalised… We expect it to take off soon,” the Alstom Power Senior Vice-President for Thermal Products, Mr Guy Chardon, said. “We will be one-third equity partner in the joint venture company with a capital of €25 million … We want the agreement to be finalised as quickly as possible,” said Mr Chardon, who was in Chattanooga for the inauguration of Alstom’s new ‘green’ turbine manufacturing facility.

The joint venture is slated to initially supply turbines to eight units of 700 MW each being developed by NPCIL. The value of supplies is likely to be around Rs 6,000 crore.

The Alstom Power President, Mr Philippe Joubert, said the focus would be on getting the venture up and running it at the earliest.

NPCIL and BHEL had, in 2008, announced the floating of a joint venture company to carry out engineering, procurement and construction activities for setting up the conventional island portion of nuclear power plants.

The venture had subsequently sought expressions of interest for a technology partnership for manufacturing 700 MW range and higher rating turbine generator sets of up to 1,600 MW, wherein the selected global partner would offer technology for turbine, generator and auxiliaries packages for the new fleet of nuclear power plants on the anvil in the country. Apart from Alstom, Skoda JS of the Czech Republic, OJSC Turboatom of Ukraine and Siemens of Germany were in the fray for joining the venture.

NPCIL is working on plans to develop a fleet of pressurised heavy water reactors of 700-MWe (mega watt electrical) unit capacity. Plans for four 700 MWepressurised heavy water reactor units in Bargi in Madhya Pradesh and another two in Kumharia in Haryana are on the anvil. Besides these units, NPCIL is in talks for importing light water reactor units ranging from 1,000 MWe to 1,650 MWe from Russia, France and the US. These would be deployed at six sites across the country.

Source: Anil Sasi, The Hindu Business Line

Alstom exec’s preparing for nuclear revival

Staff photo by Dan Henry/Chattanooga Times Free Press Stephane Cai, Chief executive officer with Alstom of Chattanooga, speaks about the company’s nuclear turbine production near the front of the facility on Wednesday.

With completion of a new “flagship” Chattanooga factory, Alstom executives say they’re ready to make the world’s largest steam and gas turbines for power plants as the company prepares for America’s nuclear revival.

“This is the latest and biggest,” Stephane Cai, managing director of the turbine facility, said of the sprawling 350,000-square-foot factory built on the Tennessee River near downtown. “This is the flagship.”

Already, the $300 million plant on Riverfront Parkway has a two-year backlog of business retrofitting power plant components, Mr. Cai said.

On Thursday, the Paris-based company’s top French leaders along with Tennessee and local officials will dedicate the plant, which Mr. Cai said represents the largest worldwide industrial investment by Alstom in decades.

“It’s equipped with the most advanced technology on the market,” he said. “No Alstom factory has this luxury.”

For Chattanooga leaders, Alstom’s new plant is another brick in the wall of building job growth in the power generation sector.

The energy sector will be “a major contributor to our economy,” said Tom Edd Wilson, the Chattanooga Area Chamber of Commerce’s chief executive.

The company has hired about 200 people so far with plans to boost the work force to 350 by 2013. Alstom already employs 600 in the city at an adjacent plant that produces replacement components for coal-fired facilities.

“These are very high-quality jobs,” Mr. Cai said of the new slots. The average salary for the jobs is about $75,000, Alstom officials have said.

Work at the 75-acre site began almost three years ago. Alstom built its new plant amid older structures, tearing down and recycling tons of steel and concrete slabs as the company aims for Leadership in Energy and Environmental Design status for the manufacturing campus.

Alstom secured property tax breaks worth an estimated $21 million for the new Chattanooga operation.

“Alstom is a great expansion,” Hamilton County Mayor Claude Ramsey said.

Mr. Cai said the company’s investment signals the global manufacturer’s commitment to nuclear power, especially in the United States.

“The U.S.A. has the world’s largest installed power plants,” he said. “It has an aging fleet. The retrofit market is attractive.”

The new plant is designed to build high-end products, or what Mr. Cai termed “the big potatoes.” Projects planned for production likely will hit eight digits in terms of cost, the official said.

At plant capacity, he said he foresees 15 to 20 projects going on at any time.

Read more: Chattanooga Times Free Press

Alstom and Schneider to bid on Areva’s T&D

France’s Alstom and Schneider Electric have said they are considering a joint bid to acquire Areva’s transmission and distribution (T&D) division. Areva’s supervisory board recently asked the executive board to put the division up for sale.

The T&D division supplies products, systems and services dedicated to electricity transmission and distribution from the power plant to the final user. The division’s customers are electric utilities as well as the oil, mining and metals, wind energy, paper and glass, transportation, and power engineering industries. Areva said that, through its transmission and distribution division, the group appears among the only three global actors in the high- and medium-voltage switchgear markets.

Alstom and Schneider said that they would create a joint venture to bid for Areva T&D. If its bid were successful, the high-voltage transmission activities would then be transferred to Alstom and the medium-voltage distribution activities to Schneider. The companies said that “such a transfer of activities would have no social consequences.”

“This offer will optimise the strategic, industrial and commercial strengths that both Alstom and Schneider can bring to each of the two areas of T&D and maximise the value of the business,” the companies said in a statement. They added, “This offer would consequently be more attractive for the vendor.”

At the beginning of this month, Areva’s supervisory board finalized steps to be taken to finance the group’s long-term development plan. These include selling a stake of about 15% and the possible sale of its T&D operations.

Areva said that an open call for bids will be launched and a decision whether or not to sell the division and the choice of potential buyer will be taken before the end of 2009.

In 2008, the T&D division, with almost 30,000 employees, had sales revenue of €5065 million ($7200 million) and accounted for 38% of the Areva group’s sales.

The sale of its T&D division would leave Areva focussed on the nuclear power industry, with operations in uranium mining, conversion and enrichment; fuel design and fabrication; reactor design and construction; and decommissioning and waste disposal.

Source: World Nuclear News

Areva contemplates selling T&D

The French state has told Areva to explore the potential sale of its lucrative transmission and distribution business unit in order to raise funds. The state-controlled nuclear giant has to fund a major investment program, the buyout of Siemens from Areva NP as well as cost overruns on the Olkiluoto 3 project. Alstom is seen as a potential buyer of the €500 million-a-year business as well as a potential merger partner with Areva in France’s industrial strategy. The unit aids Areva’s business model as a full-scope provider and provides it with a comprehensive global presence.

Source: World Nuclear News

Alstom wins contract worth EUR 125 million to retrofit low-pressure turbines in South Africa

Alstom, a global leader in power generation, today announced that it has signed a contract worth approximately EUR 125 million with South Africa’s state-owned utility Eskom to retrofit the low-pressure turbines of the two 970 MWe units at Koeberg Nuclear Power Station, South Africa’s sole nuclear power plant.
The retrofit will increase the station’s power output by over 65 MW, improve availability and reliability, as well as extend the lifetime of the plant. The retrofits will be carried out during planned refuelling outages, thus reducing the chance of interruption to generation from the station.

“We are pleased to have this opportunity to further build on our relationship with Eskom through the supply of the retrofit for their two steam turbines,” said Guy Chardon, Senior Vice President, Alstom Turbomachines group. “We believe nuclear energy offers a carbon-free, efficient, viable alternative for meeting increasing demand for energy.”

Eskom and Alstom have worked together on previous projects such as the retrofitting of the Arnot power plant, an integrated retrofit project providing a capacity increase to that station of more than 300 MW. Eskom recently placed orders for new equipment contracts with Alstom for the Medupi and Kusile coal fired power plants producing 4800 MW each.

As the world’s leading supplier of nuclear turbine systems and its position as world leader in nuclear retrofits, Alstom has installed more than 180 new turbine islands and retrofitted 220 rotors on nuclear plants worldwide. More than 40% of the world’s nuclear power stations operating today use Alstom-made equipment. In South Africa, Alstom has a 100-year presence and is a leader in the country’s turbine generator business. Alstom turbines generate 80% of South Africa’s installed capacity.

About Alstom

Alstom is a global leader in the world of power generation and rail infrastructure and sets the benchmark for innovative and environmentally friendly technologies. Alstom builds the fastest train and the highest capacity automated metro in the world, and provides turnkey integrated power plant solutions and associated services for a wide variety of energy sources, including hydro, nuclear, gas, coal and wind. The Group employs more than 76,000 people in 70 countries, and had orders of EUR23,5 billion in 2007/08.

About Eskom

Eskom Holdings Ltd. is a vertically integrated electricity utility in South Africa that generates, transmits and distributes electricity. Eskom is among the top 10 power companies by sales and 11th by generating capacity. Eskom has embarked on a massive rolling capacity expansion programme to meet an increase in demand and to confront the challenges of an ageing transmission and generation system. For more information on Eskom, visit www.eskom.co.za

Source: Alstom

Alstom interested in the transmission and distribution unit of Areva

French industrial engineering group Alstom would be interested in the transmission & distribution unit of nuclear power group Areva if the latter wanted to sell, an Alstom spokesman said on Tuesday.

‘Alstom has often declared its interest in a tie-up with Areva but under the current conditions this is not possible,’ the spokesman said.

‘We confirm our clear interest in the electrical generation and transmission and distribution activities of Areva, if they were for sale, because of the potential synergies,’ he added.

A spokesman for Areva said the group had no plans to sell the T&D unit, adding that it had not received any proposal from Alstom.

At 1215 GMT Alstom shares were up 2.4 percent, outperforming a CAC-40 index up 1.3 percent.

Les Echos newspaper said on Tuesday that Alstom wanted to buy back the transmission and distribution activities it sold to Areva in 2004, as part of its financial rescue plan.

Alstom has repeatedly said it is in favour of a merger with the world’s biggest maker of nuclear reactors, which is almost 80 percent owned by the French state, but Areva’s chief executive has spoken out against a tie-up.

‘There are strong links with (Alstom’s) power systems activity,’ said an Alstom spokesman. ‘We do not hide the fact that we are interested in a ‘re-acquisition’ because of these synergies.’

The paper said the transmission and distribution activities were sold for 930 million euros ($1.18 billion) in 2004 but are now valued at over 5 billion euros after strong growth and represent around 38 percent of Areva’s turnover.

Areva is in need of cash to fund its international expansion and compete with rivals Westinghouse Electric, a unit of Japan’s Toshiba, and Russia’s Atomenergoprom, but has said it would not sell its transmission and distribution activities.

The group last month unveiled a 2.7 billion euro ($3.41 billion) investment plan, which it said was approved by the French state.

‘The plan has been approved, and I am sure that we will find the best funding solutions in the coming weeks,’ Chief Executive Anne Lauvergeon told a news conference on Feb. 25 as the group announced a 20 percent fall in full year net profit.

Areva could fund its investments plans thanks to a capital increase or the sale of non-strategic assets such as minority stakes in groups like Total, Safran or Eramet , Chief Financial Officer Alain-Pierre Raynaud told Reuters in an interview last month.

Alstom is looking at different ways to finance the purchase of the transmission and distribution activities, the paper added. The Alstom spokesman had no comment on the amounts mentioned in the paper and would not say whether any talks on a possible purchase were underway.

Source: Forbes