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Fennovoima nuclear venture hits another snag as K-Group pulls out

The proposed Fennovoima nuclear power plant suffered another setback on Tuesday as a court cleared the way for the pullout of a major domestic investor, the second-largest retail group, Kesko.

Työkoneita Fennovoiman ydinvoimatyömaalla Pyhäjoen Hanhikivenniemessä
Basic infrastructure is being laid in at the Hanhikivi site while Fennovoima awaits a plant construction permit. Image: Antti Pylväs / Yle

A court of arbitration has rejected a case filed by Fennovoima owner Voimaosakeyhtiö SF against Kestra, a real estate agency owned by Kesko. Also known as the K-Group, it is Finland's number-two retailer. The largest retail group, the S-Group, previously withdrew from the Fennovoima consortium. The company's biggest dairy concern, Valio, also wants to withdraw from the venture.

Kesko announced in March 2014 that Kestra would no longer invest in Fennovoima's planned Hanhikivi nuclear power station because of uncertainty about the ventures' finances, contracts and timetable. In December 2015 Kesko announced that arbitration of the case had begun.

The K-Group holds an approximately three percent stake in the project, which has an estimated price tag of 6-7 billion euros.

After German energy giant E.ON abandoned the project, Voimaosakeyhtiö SF inked a deal with Russian state-owned energy company Rosatom to build and supply the plant. It has yet to be issued a construction permit by the Finnish government, which stipulates that at least 60 percent of the company must be owned by Finnish or EU-based companies.

Greens MP calls for Helsinki-Vantaa pullout

In Helsinki, the Greens, who are poised to become the largest bloc in the city council, are calling for the city to pull out of the project as well. On Wednesday, Greens MP and city councillor Emma Kari argued that Helsinki and neighbouring Vantaa should sell off their joint share, which is small but larger than that held by any other municipalities.

Fennovoima estimates that its plant will begin operating in the west-coast town Pyhäjoki in 2024. It would be Finland's sixth nuclear reactor. Meanwhile, the fifth, TVO's Olkiluoto 3, is to come online in 2018, nearly a decade behind schedule and nearly three times over its original budget.

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