Reactor parts deal for Areva

05 November 2008

Areva and Japan Steel Works (JSW) have signed a deal to ensure the French company's supply of major components for new nuclear power plants.


Reactor pressure vessel under manufacture 
A reactor pressure vessel under
manufacture. The vessel head with
control rod apparatus protruding is in
the foreground
Areva is one of the world's leading nuclear power technology companies, while JSW is one of the leading heavy nuclear components manufacturers. A supply agreement between the two will be seen as a significant move to meet demand for new nuclear.


JSW will supply large forged parts until at least 2016, which Areva will then machine at its own works to produce finished components for power plants. Key among these major components are reactor pressure vessels, for which there is currently a shortage of supply in the global market.


Areva has its main manufacturing base at Chalon/Saint Marcel in northern France, and it recently announced plans to mirror this facility in Newport News, Virginia, USA in partnership with Northrop Grumman. Chalon produces finished steam generators and pressurizers as well as pressure vessels. Those components form the primary coolant loop of a pressurized water reactor and must withstand high temperatures, high pressures and radiation exposure with high integrity for the 60-year design life of a new power plant.


Areva is already constructing its 1600 MWe EPR nuclear power units in Finland and France. Construction is about to begin on two units in China, while six are planned for the USA and four for the UK.


JSW's Masahisa Nagata said the long term agreement would "give us certain confidence on proceeding to the next round of our major capacity expansion program."


As part of the deal, Areva has taken a 1.3% stake in JSW which would be worth $41.5 million based on JSW's current share price of ¥852 per share.


Nagata concluded: "I am sure that our business relationship with Areva will be expanded further in the future."