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Reprocessing Spent Nuclear Fuel in Indonesia: An Overview of Areva’s Opportunity for FDI. Project Brief & Final Decision. Proposed Project Build and operate a 200 tonne uranium nuclear fuel reprocessing and treatment facility in Indonesia by 2027 Final Decision

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Reprocessing Spent Nuclear Fuel in Indonesia:

An Overview of Areva’s Opportunity for FDI


Project brief final decision
Project Brief & Final Decision

Proposed Project

  • Build and operate a 200 tonne uranium nuclear fuel reprocessing and treatment facility in Indonesia by 2027

    Final Decision

  • Project is infeasible due to inordinately high risks and uncertain returns

    Relevant Stakeholders

  • PT PLN: Indonesian state-owned electric utility

  • KEPCO: Korean Electric Power Company

    Investment Criteria

  • Investment Rationale

  • Proposed scope, structure, and costs

  • Investment Risks


Commercial nuclear power value chain
Commercial Nuclear Power Value Chain

Front End: Mining, conversion, and enrichment

AREVA and KEPCO have a joint venture to develop a uranium mine in Niger. KEPCO will use this mine to supply the nuclear power stations it has built around the world.

Reactors & Services: Construction and operation of plants

KEPCO entered into a memorandum of understanding to build turnkey nuclear power plants for PLN, the state-owned electric utility which will transmit and distribute the electricity generated by the power plant.

Back End: Fuel recycling, reprocessing, and treatment

Reprocessing and treatment creates new energy resources from 96% of the content of spent nuclear fuel and stores the remaining 4% (final waste). Areva is the world leader in nuclear fuel recycling; KEPCO does not offer this service line.


Investment rationale
Investment Rationale

  • Indonesian growth potential and current macroeconomic stability

  • Elevation to G-20 status in 2009

  • Favorable FDI investment climate

  • Commitment to nuclear energy: 4 commercial nuclear power plants (first by 2017)

  • Good fit with Areva’s growth strategy to grow its Back-End Division

Sources: CIA World Factbook, IMF, OECD


Indonesia s energy needs ambitions
Indonesia’s Energy Needs & Ambitions

Energy Needs

  • >90% current energy needs primarily fulfilled by natural gas, oil, and coal

  • Electricity demand is expected to grow 6 - 7% annually

  • Renewable energy sources must account for 5% of supply by 2025

    Nuclear History

  • Research reactors since 1957

  • Member of the IAEA since 1957, signed non-proliferation treaty in 1970

  • Passed the Nuclear Policy Act in 1997, establishing a framework for commercial nuclear operations

  • KEPCO to build 4 commercial reactors

Sources: John Chipman, “Preventing Nuclear Dangers” and

Indonesian Institute for Energy Economics, “Indonesian Energy Overview,” PowerPoint presentation, July 2007


Project Scope, Structure & Costs

  • Project: Build 200 tonne uranium nuclear fuel processing facility

  • Investment vehicle: Joint Venture FDI

    • Domestic ownership of nuclear FDI must be ≥5%

  • Proposed joint venture partner: PLN

  • Primary customer: PLN

  • Estimated cost: US$5b to US$10b

  • Financing: Public-Private Partnership

  • Project start: 2022

  • Project duration: 5 years

  • Operations start: 2027

  • Projected annual revenue: $250 m

  • Projected annual net income: $35 m



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