Reforging its core business to return to competitiveness after record losses of €4.83 billion in 2014, French nuclear firm AREVA has split its five operational business units and rebranded them—again. All its assets related to the design and manufacture of nuclear reactors and equipment, fuel design and supply, and services to existing reactors now fall under Framatome, which until January 4 was known as New NP. Operations related to the nuclear fuel cycle will be undertaken by Orano, which until January 23 was known as NewCo.
Creation of the AREVA group itself was an overhaul effort. The company was formed in 2001 with the merger of Framatome, Cogema, a nuclear business of German giant Siemens, and French propulsion and research reactor arm Technicatome. Framatome—short for Franco-Américaine de Constructions Atomiques—was created in 1958 by Schneider, Merlin Gerin, and Westinghouse Electric to exploit the emerging pressurized water reactor (PWR) market. By 1975, the company had become the sole manufacturer of nuclear power plants in France, equipping French state-owned utility EDF with 58 PWRs, and gradually taking on more projects overseas, building reactors like South Africa’s Koeberg, South Korea’s Ulchin, and China’s Daya Bay and Ling-Ao. In 1989, Framatome and Siemens created a joint company called Nuclear Power International to develop the EPR, a third-generation reactor that complied with both French and German nuclear regulations. The companies eventually merged in 2001, retiring the Framatome name and giving birth to AREVA.
One of the company’s most prominent contract wins came in 2003 from Finnish utility Teollisuuden Voima Oy (TVO) for construction of the world’s first EPR, Olkiluoto 3, in southern Finland. In 2007, AREVA also signed a contract with EDF for an EPR in Flamanville, France, and separately with Taishan Nuclear Power Co., a joint venture 70% held by China Guangdong Nuclear Power Holding Corp. and 30% by EDF. Two years later, Siemens withdrew its capital in Areva NP—AREVA’s specialized nuclear steam supply system arm—citing a “lack of exercising entrepreneurial influence within the joint venture” as the reason behind the move, and transferred its 34% stake to the AREVA group.
But plagued by delays and cost overruns at Olkiluoto 3 (Figure 3) and Flamanville 3, as well as at a research reactor construction project, and financially hemorrhaging from renewable energy contracts, AREVA’s finances began to fall into disarray, reaching record losses in 2014. In 2015, EDF moved to snap up between 51% and 75% of the troubled nuclear giant’s reactor business, encouraged by the French government’s attempts to address a rivalry between the two majority state-owned companies.
Source: Power Technology
