In brief
Korea Hydro & Nuclear Power Co. (KHNP) ended negotiations with a Czech consortium that had been slated to construct two 1,000‑megawatt APR1000 reactors at the Dukovany site. The break‑up arises from conflicting views on contract terms and design changes that the consortium says would impose undue costs. KHNP will now seek a new contractor through a formal tender, while the Dukovany project itself remains underway.
In Seoul on 29 October, Korea Hydro & Nuclear Power Co. (KHNP) announced that it had terminated negotiations with a consortium comprising Daewoo Engineering & Construction Co. and Doosan Enerbility Co. for the construction of two 1,000‑megawatt APR1000 reactors at the Dukovany nuclear power plant in the Czech Republic. The company said the break‑up stemmed from irreconcilable differences over key contract terms related to the project’s design and cost structure.
APR1000 is a South Korea‑designed advanced pressurized water reactor that delivers 1,000 megawatts of electrical power. The Dukovany project, slated to cost roughly 25 trillion won (US$17.5 billion), has already secured approval from Czech authorities and is poised to add significant capacity to the country’s nuclear fleet. KhNP had won the project last year, and the Daewoo‑Doosan consortium had been named the construction contractor in a preliminary agreement.
According to a press release issued by KHNP, the company said: "The company has decided to terminate negotiations with a consortium comprising Daewoo Engineering & Construction Co. and Doosan Enerbility Co. for the Dukovany nuclear power plant project. The breakdown is due to differences over key contract terms." This statement indicates that the dispute centered on revised contractual clauses that the consortium viewed as unfavorable.
"I respect KHNP’s decision and pledge the government’s support for the successful construction of the nuclear power plant in the Czech Republic," Industry Minister Kim Jung‑kwan wrote in a Facebook post.
The consortium responded to KHNP’s decision by expressing regret and highlighting concerns about the new terms. It argued that the revised clauses would unfairly burden contractors with additional costs arising from design changes that the construction firms had no input on. The consortium further claimed that KHNP failed to maintain good faith, rejecting an extension of the 29 October deadline before ending negotiations. It urged the nuclear operator to resume talks in the broader national interest.
KHNP has clarified that the cessation of negotiations does not signal the cancellation of the Dukovany project. Instead, the company will formally conclude the current talks and prepare for a new tender to select a successor contractor. The transition will involve a competitive bidding process, with an aim to adhere to international procurement standards and maintain project timelines.
From a technical perspective, the dispute underscores the challenges of joint international ventures in large‑scale nuclear construction projects. Design modifications that occur after a construction contract is signed can ripple through cost estimates, risk assessments, and contractual risk allocation. KhNP’s introduction of revised terms likely involved adjustments to construction schedules, safety oversight provisions, or liability clauses that affected the consortium’s cost projections.
Because the APR1000 design incorporates advanced safety features and requires precise integration with site‑specific utilities, any changes to the design blueprint can necessitate re‑engineering of concrete foundations, cooling circuits, and electrical interfaces. These complexities create a high‐risk environment in which contractors anticipate that design changes will lead to increased labor and material costs. Hence, the consortium’s claim that KHNP’s revised terms would unfairly shift cost burdens aligns with standard risk‑allocation practices in the nuclear industry.
The resolution of this dispute will likely influence future supply‑chain decisions for Korea’s nuclear exports. Korean nuclear operators increasingly partner with foreign consortia, and the dynamics of contract negotiation can shape the feasibility of technology transfer and cooperative projects abroad. As the new tender process begins, the Czech authorities may revisit the selection criteria to ensure alignment with international procurement best practices and to mitigate future contractual disputes.
In light of these developments, observers note that the Dukovany project remains a key component of the Czech Republic’s strategy to diversify its energy mix. Despite the current negotiation deadlock, the completion of two APR1000 reactors would generate an additional 2,000 megawatts of clean electricity and reduce the nation’s reliance on fossil fuels. The industry will watch closely as new tender procedures unfold, a process expected to shed further light on the contractual frameworks that underpin international nuclear collaborations.
