China General Nuclear Power Corporation (CGN) has officially become the strategic investor which will develop units 3 and 4 of Romania’s Cernavoda nuclear power plant, Romanian state-owned Nuclearelectrica announced on Friday, October 17.

Nuclearelectrica and CGN representatives recently signed the joint letter of intent for this project. The Chinese company was the only investor interested in the project.

In the next phase, the two sides will negotiate and sign a memorandum of understanding for the project. They will have to create a new company, in which the Chinese will have at least 51% of the shares and Nuclearelectrica will be minority shareholder.

The estimated cost of the project is currently EUR 6.45 billion, but the feasibility study will be reviewed.

The two new units of the Cernavoda nuclear power plant should have an installed capacity of 740 MW each. The power plant, which is operated by Nuclearelectrica, currently has two operational reactors of 706 MW each, which generate about 18% of the country’s electricity output.

Romania currently produces more energy than it uses and the surplus goes to export. The project to build two new nuclear reactors needs to be backed up by new export markets for electricity and by a state aid scheme to ensure a minimum sale price for the energy produced by the new company, which also needs to be approved by the European Commission.

The European Commission recently approved Great Britain’s project to build the Hinkley Point nuclear power plant, which also includes a state aid scheme.

Andrei Chirileasa, andrei@romania-insider.com