KHNP CEO to meet Westinghouse officials in U.S. for joint venture discussions

Whang Joo-ho, President and CEO of Korea Hydro & Nuclear Power (KHNP), will visit the United States on Saturday to meet with officials from Westinghouse Electric Company (WEC) and sign an agreement to establish a joint venture aimed at penetrating the U.S. nuclear power market.

Whang is expected to finalize procedures for launching the joint venture during his trip, according to political sources and the nuclear industry on Wednesday. KHNP and Korea Electric Power Corporation (Kepco) had reached a settlement with Westinghouse in January, resolving a long-running dispute over intellectual property. The settlement included a pledge to enhance cooperation in the U.S. market going forward.

Since the agreement, KHNP — excluding Kepco — and Westinghouse have been engaged in detailed discussions on forming the joint venture. The talks gained momentum after U.S. President Donald Trump signed an executive order in May outlining plans to quadruple the country’s nuclear power capacity from the current 97 gigawatts to 400 gigawatts by 2050.

Speaking at a National Assembly committee meeting the previous day, Whang said KHNP’s decision to step back from the European market was a strategic move to focus on the United States. “There are various pathways into the U.S. market,” he said.
The joint venture is expected to follow a typical model in which both companies contribute capital and share profits in proportion to their equity. The exact ownership ratio has yet to be finalized.

If successfully established, the joint venture could open significant doors for Korean nuclear companies. The United States, in its push to meet surging power demand, plans to build up to 300 new large-scale nuclear power plants with a capacity of 1,000 megawatts each.

However, the agreement signed in January reportedly limits participation in new nuclear bids in North America, the European Union, Ukraine and Japan to Westinghouse alone. The joint venture will thus likely focus on the U.S. market, while Westinghouse will pursue bids independently in the EU and other regions.

Still, greater cooperation between the two sides is expected to expand opportunities for Korean firms. Doosan Enerbility is already manufacturing key equipment for Westinghouse-led projects, and Hyundai Engineering & Construction is among several Korean builders increasing collaboration with the U.S. firm.

The upcoming Korea-U.S. summit, scheduled for Monday local time, is also expected to include discussions on expanding bilateral cooperation in nuclear power.

Controversy continues, however, over the January agreement’s terms, which reportedly include a provision for KHNP and Kepco to provide WEC with $825 million per reactor in goods, services and royalties over the next 50 years.

In addition, they are said to have agreed to issue letters of credit worth $400 million per reactor as a guarantee. The agreement also reportedly restricts Korean companies to targeting export markets only in Southeast Asia and the Middle East.

The Democratic Party has strongly criticized the deal, calling it a “humiliating agreement that surrenders nuclear sovereignty to the United States.”

Source: Korea Joong Ang Daily