Credit Suisse selected as adviser to UAE nuclear programme

With initial expenditure of up to $40 billion, contract seen as potentially lucrative for financial firm.

The Emirates Nuclear Energy Corporation (ENEC) has appointed Credit Suisse as the financial adviser to the country's groundbreaking civilian nuclear programme. Padraic Riley, an ENEC spokesman, confirmed the appointment yesterday but declined to offer further details. ENEC, which is building nuclear power plants in the UAE and is owned by the Abu Dhabi Government, last December awarded a US$20 billion (Dh73.46bn) contract to a group of South Korean companies to construct four nuclear reactors on Abu Dhabi's western coastline by 2020. The contract represents the country's largest infrastructure project and has drawn the interest of scores of consulting firms and banks.

ENEC is expected to award additional contracts to supply uranium fuel and to help operate the reactors, pushing up total expenditure on the initial stage of the nuclear programme to as much as $40bn. The company has said it was likely to award contracts for additional reactors in the future. The value of the advisory contract was not disclosed but it represented a big win for Credit Suisse, said Robert Bryniak, the chief executive of Golden Sands, a power consultancy that has been involved in the launch of privately owned power and water plants across the region.

"It'll be worth tens of millions [of dollars], it'll be a huge contract for sure," he said. "It's also a good way for them to get into the financial deal ? what usually happens is the adviser will have an option to get involved in the debt side as well." As the financial adviser, Credit Suisse will need to advise ENEC on the particular financial risks that come with building a nuclear reactor, Mr Bryniak said, including the development of a plan to minimise the cost of safely disposing of spent fuel and nuclear waste when the reactors are decommissioned.

International banks generally see long-term loans to GCC utilities as safe investments that yield a decent return, Mr Bryniak said. "The banks like their kinds of projects - they provide long-term, almost guaranteed payments," he said. "They're almost risk free." [e-mail]