GdF-Suez and Total secure nuclear stake

05 May 2009

Oil and gas firms will have a substantial interest in the second new large nuclear reactor to be built in France. GdF-Suez is to take a one-third stake and share it with Total.


The stake was confirmed by prime minister Francois Fillion, GdF-Suez said. The company will initally take 33.33% of the shares in a project company to build the 1650 MWe Areva EPR unit at Penly, with Electricité de France (EdF) taking the majority stake. Italy's Enel has the right to take up to 12.5% of the project, which would leave only a few percent for any other investors.


Joint announcements from GdF-Suez and Total confirmed a proposal for the two to "join forces" for the project, marking Total's first involvement in the nuclear power sector. Total is to take 25% of the GdF-Suez stake as part of a partnership which will leave GdF-Suez with 25% overall and Total with 8.3%.


Penly (Xavinthesky)
Penly: Plenty of room for expansion (Image: Xavinthesky)


Company statements quoted Total head Christophe de Margerie: "I am pleased that Total contributes to this achievement alongside GdF-Suez and EdF, which will constitute a new reference for the Group."


GdF-Suez head Gérard Mestrallet said the move was "a major step forward in the implementation of GdF-Suez nuclear strategy." In July last year the company welcomed the announcement of further new-build plans in France, adding, "If GdF-Suez was to decide to be a candidate for the construction and operation of this second EPR in France, the new group would do so in cooperation with French and/or international electrical partners as well as interested electro-intensive industrial parties."


The firm already owns Belgium's Electrabel, which owns and operates three pressurized water reactors at Tihange, while operating four more at Doel. It also owns the Tractebel nuclear engineering company and bought a 5% stake in Areva's forthcoming George-Besse II uranium enrichment plant last June.


Nuclear expansion in Belgium is currently impossible due to government policies, and GdF-Suez is instead looking at the fast-emerging British new-build market as well as France. The company, an alliance with Iberdrola and Scottish & Southern, was unsuccessful in bidding for new-build sites in the most recent UK land auction and now looks forward to subsequent land sales.


For Total, it is routine to work with partners, and the firm already works with GdF-Suez on a range of oil and gas exploration and gas-fired power generation projects. The two also have a joint subsidiary in the solar power sector.