Will KEPCO and KHNP Spend $26 Million on Legal Battles?
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Synopsis
Discover how South Korea's top energy firms, KEPCO and KHNP, are embroiled in a legal battle costing over $26 million due to payment disputes on a major UAE nuclear project. Learn about the implications of this financial fallout and the efforts to resolve the conflict.
Key Takeaways
- KEPCO and KHNP are embroiled in a $26 million legal dispute.
- The conflict is related to the Barakah nuclear project in the UAE.
- The contract for the project was valued at 20 trillion won.
- KHNP is seeking around $1 billion in additional costs.
- The UAE aims to strengthen ties with South Korea in various sectors.
Seoul, Oct 5 (NationPress) Two major public energy companies in South Korea are projected to allocate approximately 37 billion won ($26.1 million) for legal disputes stemming from a payment disagreement related to a significant nuclear power project in the United Arab Emirates, as reported on Sunday.
The Korea Electric Power Corp. (KEPCO) is set to spend 14 billion won, while Korea Hydro & Nuclear Power Co. (KHNP) will allocate 22.8 billion won for legal fees associated with their payment conflict regarding the Barakah nuclear facility, as outlined in documents submitted to Rep. Kim Dong-ah of the ruling Democratic Party, according to the Yonhap news agency.
In 2009, South Korea secured a 20 trillion-won contract for the construction of the plant, marking the country's inaugural overseas nuclear energy venture.
After the project's completion in the previous year, KEPCO, the primary contractor, and KHNP, responsible for operational support services, have been engaged in a final settlement negotiation.
In May, KHNP sought mediation from the London Court of International Arbitration, claiming around $1 billion in additional costs due to delays and extra work orders imposed by both the UAE and KEPCO.
"We will investigate the measures taken by the previous administration to resolve the conflict between KEPCO and KHNP and ensure accountability for those responsible," stated Kim.
Simultaneously, the United Arab Emirates (UAE) is looking to enhance collaboration with South Korea in sectors like energy regulation, small modular reactors, and artificial intelligence (AI), building on the achievements of the Barakah project, according to comments from the head of its nuclear regulatory authority.
Christer Viktorsson, Director General of the Federal Authority for Nuclear Regulation (FANR), emphasized in a recent interview with Yonhap News Agency that the insights provided by South Korean partners have been instrumental in the Barakah project's success.
FANR serves as the regulatory entity for the nuclear energy sector in the UAE, enforcing safety, security, and radiation protection protocols.
Point of View
It's crucial to ensure that such conflicts are addressed transparently and efficiently to maintain South Korea's reputation in global energy markets.
NationPress
05/10/2025
Frequently Asked Questions
What is the nature of the dispute between KEPCO and KHNP?
The dispute revolves around payment disagreements related to the Barakah nuclear power project in the UAE, leading to a significant financial allocation for legal fees.
How much are KEPCO and KHNP spending on legal fees?
KEPCO is expected to spend 14 billion won, while KHNP will allocate 22.8 billion won, totaling nearly 37 billion won ($26.1 million).
What role does the UAE play in this situation?
The UAE has been involved in the project and is currently seeking to expand cooperation with South Korea in energy regulation and technology.
What does the contract entail?
The contract, valued at 20 trillion won, was for the construction of the Barakah nuclear plant, marking South Korea's first overseas nuclear project.
What is KHNP's claim regarding costs?
KHNP has requested mediation from the London Court of International Arbitration, seeking around $1 billion in additional costs due to delays and extra work orders.
