Go to Contents Go to Navigation

Compensation costs for Shin Kori reactors could rise to 138 bln

All Headlines 15:43 October 30, 2017

SEOUL, Oct. 30 (Yonhap) -- Contractors of the state-run Korea Hydro & Nuclear Power Co. have demanded 96 billion won (US$85.3 million) for their financial damages from the suspended construction of two nuclear reactors, which could raise the total compensation amount to 138.5 billion, a report showed Monday.

The government last week decided to restart construction of Shin Kori units 5 and 6 in the southeastern city of Ulsan after a three-month hiatus, accepting a civilian panel's recommendation of its fate.

The state energy company earlier expected a compensation cost of about 100 billion won, which includes 66.2 billion won claimed by its contractors as well as management fees and other related costs.

In a KHNP report acquired by Rep. Kim Jung-hoon of the main opposition Liberty Korea Party, the atomic energy company reported to its board of directors on Friday that the cost was estimated to be greater due to a rise in financial damages claimed by its contractors and parts suppliers.

"There will be a considerable gap between the KHNP and its contractors when reviewing the compensation bill, which has increased much more than the company had expected," Kim said. "If they fail to compromise on the amount of compensation, it could lead to legal suits."

The KHNP said it will carry out legal reviews and complete the compensation process by the end of November after negotiating with its contractors, including Samsung C&T Corp. and Doosan Heavy Industries & Construction Corp.

Nuclear regulators check the construction site of Shin Kori units 5 and 6 in the southeastern city of Ulsan on Oct. 25, 2017, after the government decided to accept a civilian panel's recommendation to resume their construction. (Yonhap)

The reactors were about 30 percent complete before the halt in July with about 1.6 trillion won having already been spent on the project.

While work on the normal facilities have already been underway, the KHNP will formally start construction on major facilities after getting formal approval from nuclear reactors as early as early November.

During the board meeting, the company said it will revise its project schedule within this year to reflect the delayed process.

While construction of Shin-Kori units 5 and 6 was scheduled to be complete by 2021 and 2022, officials said the schedule could be delayed at least 4-5 months due to the unexpected construction suspension. Further delays could also take place as past projects have seen cost overruns and delayed schedules due to safety issues.


Send Feedback
How can we improve?
Thanks for your feedback!