A Canadian company is partnering with a Chinese firm in anticipation of building two more nuclear reactors in Romania that could be worth $1.5 billion for Canada's economy.
Candu Energy Inc., an SNC-Lavalin (TSX: SNC) company, has signed a co-operation agreement with China Nuclear Power Engineering Company Ltd. for the construction of two nuclear reactors at the Cernavoda Nuclear Power Plant in Romania.
Preston Swafford, the CEO of Candu, said in an interview that be believes the exclusive deal will keep Canada's nuclear-engineering talent sharp.
"It's a Canadian technology," Swafford said on Thursday. "You obviously have a continuum of skills that stay well-honed and ready to serve."
"This project stands to make a meaningful contribution to Canada's economy and support highly-skilled jobs here at home," he said in a news release.
The $6-billion agreement would boost nuclear power up to 40 per cent of all energy used in Romania. Swafford said the nuclear power could replace coal or natural gas now being used in the central European country.
The two reactors would complement two existing Candu reactors built in 1996 and 2007 that already supply 20 per cent of Romania's energy.
Swafford said the agreement deepens the company's already-strong ties with both the Romanian and Chinese nuclear industries. Candu reactors have operated in both countries for more than a decade.
Swafford said sharing the risks and rewards with large firms is common.
"They clearly have finance capabilities that help," said Swafford of China Nuclear Power.
In a separate agreement, SNC Lavalin has signed an agreement with China National Nuclear Corporation that could eventually lead to the creation of a reactor in China that uses recycled nuclear fuel.
"We think that almost doubling the energy output for the same gram of uranium is a pretty powerful benefit to the environment as well as the communities we serve."
The reactors will reduce the amount of waste created by nuclear power, he noted.
It is anticipated that initial tests with recycled fuel will be done with existing Candu reactors in Qinshan, southwest of Shanghai as early as next year.
If the tests are successful, Swafford said he expects that there will be a strong push from the Chinese government and business to build reactors that can use recycled fuel.
The announcements were made in Vancouver to coincide with a visit from China's minister of energy, who was present at the signing of the agreements.