Business news from Ukraine

“Energoatom” has registered share issue for UAH 306 bln

On February 21, 2024, NNEGC Energoatom received a certificate of registration of a share issue worth more than UAH 306 billion.

“On February 21, 2024, the company successfully and on time overcame the next stage of corporatization: a certificate of registration of the issue of shares, 100% of which will belong to the state of Ukraine, was received,” the company said on its Telegram channel on Friday.

According to NNEGC, this step is extremely important, as it emphasizes the commitment to implement open corporate standards and transparency in the company’s management.

“The certificate of registration of the share issue makes it possible to attract new investments and increase investments in the energy sector,” Energoatom emphasized.

As reported, on December 29, 2023, the Cabinet of Ministers decided to establish Energoatom, a joint-stock company with 100% state-owned shares.

In January 2024, the state registration of Energoatom took place and the company’s charter was registered.

“Energoatom is the operator of four nuclear power plants: Zaporizhzhya, Rivne, South Ukraine and Khmelnytsky, which operate 15 nuclear power units with a total capacity of 13.8 GW, covering about 55% of Ukraine’s electricity needs.

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“Energoatom” saved UAH 2.3 bln after refusing from Russian nuclear fuel

The refusal from Russian nuclear fuel with a parallel active entry into the global nuclear materials market allowed Energoatom to save UAH 2.3 billion on the difference in world prices since 2022.

“The effective work of Energoatom in the uranium market and its conversion and enrichment services has given Ukraine the opportunity not only to get rid of its dependence on Russian nuclear fuel, but also to save significant funds,” the company said, citing NNEGC Chairman Petro Kotin.

According to him, the decisions taken by the company in 2022-2023 to increase the purchase of uranium and uranium conversion and enrichment services, as well as the negotiations and contracts concluded in advance with Energoatom’s international partners, represented by the British Urenco and Canadian CAMECO, have brought positive results so far.

“Firstly, we have calmly and without damage completely abandoned nuclear materials and related services of Russian origin. Secondly, we save about UAH 2.3 billion on the difference in world prices for these products (from the time of procurement to the present day, they have increased by more than a third on average),” Kotin said.

According to the NNEGC, the global revival of nuclear generation has led to a continuous increase in prices for uranium and uranium conversion and enrichment services, which are already reflected in world records.

“Therefore, the contracts signed by Energoatom with Urenco and CAMECO guarantee long-term uninterrupted operation of the domestic nuclear generation,” the company added.

Urenco, in particular, will supply Energoatom with uranium enrichment services until 2035 with the possibility of extending the contract until 2043; CAMECO will meet Energoatom’s needs for natural uranium hexafluoride (UF6) by 100% in 2024-2035 by supplying it and providing conversion services.

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“Energoatom” paid over UAH 21 bln to state budget

In 2023, Energoatom paid more than UAH 21 billion in tax and other payments to the state budget.

“This is UAH 1 billion more than the company paid to the state budget in 2021, when it operated all 15 nuclear power units,” NNEGC said on Telegram.

The head of Energoatom, Petra Kotina, noted that in terms of taxes and other payments to the state budget in 2023, the company managed to fulfill its obligations, operating only nine power units in the territory controlled by Ukraine without the temporarily occupied Zaporizhzhia NPP with its six thousandth power units.

As reported, in the first half of 2023, Energoatom received UAH 68 billion in revenue and paid almost UAH 11 billion in taxes to the state budget of Ukraine.

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State-owned Energoatom has become a joint-stock company

State-owned enterprise National Atomic Energy Generating Company Energoatom has been transformed into a joint-stock company with 100% of its shares owned by the state, Cabinet of Ministers representative in the Verkhovna Rada Taras Melnychuk said in Telegram. According to him, the government decisions adopted on Friday provide for the establishment of Energoatom JSC, approval of its charter and provisions on the supervisory board and principles of its formation.

“It is established that the joint-stock company is the legal successor of all property and non-property rights and obligations of SE NAEK Energoatom from the date of state registration of the joint-stock company,” Melnychuk specified.

“Corporatization according to the best international standards will strengthen the quality of management, transparency and accountability of the company. It also opens up new opportunities for the development of our nuclear power industry and partnership with international companies,” – says the Prime Minister of Ukraine Denis Shmygal.

As reported, the plan to transform Energoatom into a JSC, 100% owned by the state, was approved by Government Order No. 571-r of June 27, 2023. The process should be completed by March 2024.

The start of the tender procedure for the election of members of the NAEK’s nabsoobet by November 30, 2023 and the transformation of the SOE into a JSC by December 31, 2023, in particular, is a condition for Ukraine to receive an additional $100 million in energy assistance.

“Energoatom is the operator of all four operating nuclear power plants in Ukraine. It operates the Zaporizhzhya, Pivdenno-Ukrainian, Rivne and Khmelnytskyi plants with 15 power units equipped with water-water power reactors, with a total installed electrical capacity of 13.8 GW. ZNPP with a capacity of 6 GW has been under the occupation of the Russian Federation since May 4, 2022.

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Energoatom increased revenue from electricity sales by 30%

In 2023, NNEGC Energoatom increased its revenue from electricity sales by 30% (by UAH 44 billion) compared to last year – up to UAH 190.7 billion, the company reported on its Telegram channel.

“Of these funds, more than UAH 124.4 billion was paid as part of the PSO, or in other words, to maintain low tariffs for the population,” the company said in a statement.

The company’s revenue quadrupled from 2020 (UAH 48.1 billion) to 2023. At the same time, over the same period, the growth in the cost of electricity production amounted to 26.6%.

In 2024, NNEGC plans to increase its revenue by one third compared to the current year – up to UAH 253.3 billion.

“Despite wartime, a significant reduction in electricity consumption and the loss of capacity at the temporarily occupied Zaporizhzhya NPP, we managed to implement a set of measures to improve the economic efficiency of Energoatom’s operations. This is what allows the state to maintain low electricity tariffs for the population,” NNEGC President Petro Kotin said in a statement.

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“Energoatom” and American Holtec plan to establish joint venture

NNEGC Energoatom and Holtec International plan to establish a joint venture to organize a production complex and a technology center in Ukraine to localize equipment for small modular reactors (SMR) of the American company.

According to NNEGC’s post on Telegram, the facility will house an engineering and design center, storage facilities for materials and component production, as well as training facilities, including an SMR simulator.

The production is expected to create thousands of jobs for qualified Ukrainian personnel.

“The introduction of advanced technologies and the construction of modern Holtec production facilities in Ukraine will be of great importance for the post-war economic recovery of our country. Cooperation with Holtec gives Ukraine the opportunity to become a leader in the global nuclear energy sector,” Energoatom President Petro Kotin was quoted as saying in the statement.

“We believe that Ukraine has demonstrated its ability to build and commission a powerful nuclear facility, despite the continuous barrage of Russian missiles. Therefore, Ukraine’s recovery can begin without waiting for the end of hostilities,” said Holtec President and CEO Dr. Chris Singh.

As reported, in November 2022, Ukraine and the United States announced a project to build an SMR in Ukraine. In addition to generating electricity using SMR and advanced electrolysis technologies, the country also plans to produce pure hydrogen and ammonia.

In April 2023, Energoatom and Holtec signed a cooperation agreement on SMR deployment, which envisages the construction of up to 20 SMR-160 light water reactors, with the implementation of the first pilot project and reaching the minimum regulated reactor power and grid connection by March 2029.

Holtec also announced plans to organize facilities in Ukraine to train personnel, transfer the necessary technologies, manufacture and maintain SMR equipment. “Ukrenergo has already recommended 16 TPP sites where they could be located.

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