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Funding in for Fennovoima nuclear plant, Russian contractor begins construction

Finnish power consortium Fennovoima says it has already received nearly one billion euros in financing for its Pyhäjoki nuclear power plant. At the same time main Russian building contractor Titan-2 has begun preparatory building work - although an official construction permit for the nuclear plant isn’t likely until 2018.

Työkoneita Titan2:n työmaalla Pyhäjoen Hanhikivellä
Image: Yle

The contentious Fennovoima nuclear power plant is considered the largest industrial investment in northern Finland. Total costs for the project have been pegged at between 6.5 and 7 billion euros. The owner, Finnish power consortium Fennovoima, has not disclosed more precise figures.

Primary funding for the project will come from credit organised by the Russian state-owned nuclear power plant contractor Rosatom. Owners will also contribute some of their own capital. Fennovoima said it has already received the first drawdown of financing from Russia’s state welfare fund, amounting to 920 million euros. Altogether the fund will contribute 2.4 billion euros to the nuclear project.

Fennovoima says the Hanhikivi plant will be a turnkey solution, which will ensure that the price tag will not vary from the total agreed in December 2013.

Final building permit not expected before 2018

Yle reported Friday that the Russian construction company Titan-2 – which lists itself as Rosatom's strategic partner – has been using local Finnish companies to begin work on ancillary buildings for the nuclear project. These include communal and project management facilities as well as the foundations for the nuclear reactor.

However the company can’t begin work on the nuclear power plant itself without a final building permit from the government. Estimates put the earliest date by which the government will grant a permit at 2018.

Director of Titan-2 in Finland Alexander Alexander Zmikhnovskiy told Yle that the company will initially employ some 30 subcontractors, later in the autumn that will expand to 300 workers. The first subcontractors have come from Pyhäjoki, Kalajoki, Raahe and Vieremäki.

"Our cooperation with Finnish subcontractors has begun well. I’m impressed by their labour practices and the quality of their work," Zmikhnovskiy added.

Massive construction work afoot

The Hanhikivi landscape the nuclear power plant is slated for resembles a moonscape, as all of the vegetation has already been leveled. The area where the road network, additional buildings and industrial area are to be located is being raised by between two and four metres with landfill.

Fennovoima, the customer for whom Rosatom will build the nuclear plant, owns nearly 400 hectares of local land and waterways. Using expropriation rights, the consortium has also taken possession of an additional 100 hectares.

Fennovoima began construction in the area as early as last autumn, working to lay down roads, municipal infrastructure and support structures. The area has also been fenced off and is now subject to tight access controls.

Titan-2 is responsible for civil engineering works, developing the infrastructure and building the reactor itself. At its peak, construction of the nuclear plant is expected to employ roughly 4,000 workers.

Fennovoima's planned Pyhäjoki nuclear plant has faced strong opposed in Finland and Northern Sweden, where non-governmental groups as well as government officials and local politicians have voiced concerns over nuclear safety as well as the potential destruction of Northern Sweden's nature and fish stocks.

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