Daewoo Engineering and Doosan Enerbility Protest Breakdown of Czech Nuclear Negotiations

Daewoo Engineering and Doosan Enerbility have called for the resumption of negotiations following the announcement of a breakdown in subcontracting talks for the main equipment construction of a new nuclear power plant in the Czech Republic by Korea Hydro & Nuclear Power (KHNP).

On the 29th, the Daewoo and Doosan consortium issued a statement expressing regret over KHNP's unilateral declaration of a negotiation breakdown without extending the deadline for further discussions, stating, "We cannot accept this decision."

Since being selected as construction partners for the Czech nuclear project in 2018, the two companies have been involved in building a local network of partners and supporting licensing and bidding processes. After the main contract was signed between KHNP and the Czech client in June of last year, they began negotiations for the subcontracting agreement.

The key issues leading to the breakdown of negotiations were the contract terms and review period. According to the consortium, KHNP presented a revised contract proposal with changed terms on the 7th. The consortium requested an extension of the negotiation period until December 31 to review the new conditions, but this request was reportedly denied.

The consortium specifically raised concerns about the risk of increased construction costs due to design changes for the APR1000 nuclear reactor, which is set to be the world's first commercialized model. They argued that it is unreasonable to require the construction company, which is not involved in the design process, to bear the burden of additional construction costs without any increase in the contract price.

The consortium explained that they had proposed a revised contract that accepted the construction unit prices submitted to KHNP in January 2024 and lowered the contract amount to a level that could absorb losses. However, they claimed that the lack of sufficient time to review the changed contract terms led to the breakdown of negotiations.

The consortium stated, "The revised contract terms contained risks that threaten the survival of private enterprises," and urged KHNP to return to the negotiating table for the sake of broader interests and national benefits.