US agency in $2bn nuclear loan to Abu Dhabi

The American export credit bank has authorised a US$2bn loan to the UAE nuclear programme.

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The US export credit agency has approved a US$2 billion (Dh7.35bn) loan to help pay for Abu Dhabi's nuclear plant.

It is the first slice of financing for the US$20bn cost of building the power station. The first reactor of the project is expected to be completed by 2017.

The US Export-Import Bank (Ex-Im), which backs projects abroad that support American business, announced on Friday it had authorised the largest loan to the UAE in its history.

"In addition to bolstering American jobs, Ex-Im Bank will make history by backing the construction of the first nuclear power plant on the Arabian peninsula," said Fred Hochberg, the agency's president.

The loan was issued to Barakah One, a project finance vehicle of Emirates Nuclear Energy Corporation (Enec), the Abu Dhabi Government company charged with building and operating the plant.

Westinghouse, a unit of Toshiba based in Pittsburgh, is providing reactor coolant pumps, engineering services and training.

South Korea's Korea Electric Power Corporation (Kepco) is the primary contractor for the four reactors planned for Baraka, an Al Gharbia outpost 300km from the capital.

The Export Import Bank of Korea and a set of commercial lenders are expected to finance $10bn of the plant's cost, with Abu Dhabi covering the rest.

"The final figure is still being negotiated and finalised," said Fahad Al Qahtani, an Enec spokesman, adding financial close was expected by the end of the year.

The US loan is the last in a string of advancements in the nuclear programme.

In July, Enec and its primary contractor Kepco began pouring the foundations for the first 1400-megawatt reactor, which relies on American technology adapted by South Korea and is scheduled to start generating power by 2017.

Last month, Enec awarded a $3bn contract for 15 years' worth of nuclear fuel, or about 12,000 tonnes of uranium, to British, Canadian, Russian, French and American companies.

Enec is preparing to apply for a licence to build the third and fourth reactors by end of this year.