Rooppur uranium arrives in Sep, to be transported by road

    Originally published in The Business Standard on 2 July 2023

    Bangladesh is set to bring in the first shipment of nuclear fuel to test run the Rooppur plant this September, according to Science and Technology Minister Yeafesh Osman.

    But, the government is not considering insurance coverage for the nuclear fuel’s transportation from Dhaka airport to the project site by road initially owing to various reasons, including its potential impact on the project cost and electricity price, officials have told The Business Standard.

    Instead, the authorities are now solely relying on the finance ministry’s “financial assurance letter” to guarantee compensation for any damage that may occur during the transportation process.

    As such, the government is likely to bear the entire risk of potential financial losses resulting from any damage to fuel imported for the Rooppur plant during its transportation from Dhaka airport to the project area by road.

    The two units of the Rooppur Nuclear Power Plant will require 70-80 tonnes of uranium annually, with uranium being loaded into the reactors every 18 months. Each kilogram of uranium will cost the government $550.

    The plant authorities are expected to begin test operation next year.

    The uranium, which is sourced from Russia, will be transported in a specially designed container aboard a dedicated aircraft to Dhaka’s Hazrat Shahjalal International Airport. The Bangladesh Army will supervise the transportation of the containers, filled with uranium, by road to Rooppur, located in Ishwardi upazila of Pabna district. Some manpower is also being trained for this purpose, sources at the ministry said.

    The International Atomic Energy Agency (IAEA) will oversee the entire operation to ensure its compliance with safety protocols.

    When asked about this last Tuesday, Science and Technology Minister Yeafesh Osman told The Business Standard that the transportation method of nuclear fuel is considered a confidential matter due to security concerns. Hence, disclosing specific details about it is not possible.

    The minister pointed out that other countries worldwide also maintain secrecy regarding the transport of such fuel for security reasons.

    The minister chose not to provide any comments when enquired about the issue of insurance coverage.

    However, a senior official of the ministry expressed concerns regarding the absence of insurance coverage for capital- and technology-intensive installations such as the Rooppur Nuclear Power Plant.

    The official said insurance companies in Bangladesh, both public and private, currently lack the necessary experience and capacity to insure such complex projects. Additionally, if the power plant were to be insured now, the annual premiums would be considered part of the project’s investment cost, potentially impacting electricity tariffs. Considering all this, the authorities are not pursuing insurance coverage at the moment, added the official.

    Under the Bangladesh Atomic Energy Regulatory (BAER) Act-2012, the maximum financial loss for each accident during the fuel transportation, storage, use, commissioning, operation, and maintenance of the Rooppur Nuclear Power Plant is set at 300 million Special Drawing Rights (SDR), equivalent to approximately Tk3,300 crore at the current exchange rate. The SDR is an international reserve asset created by the IMF to supplement the official reserves of its member countries.

    To address the issue of financial security, the BAER recommends the establishment of an internationally accepted National Nuclear Insurance Pool or the provision of financial security by an insurance company designated or identified by the government of Bangladesh.

    To ensure compliance with the necessary requirements for nuclear fuel transportation in the absence of any insurance coverage, the Ministry of Science and Technology on 5 June this year wrote to the Finance Division, requesting the issuance of a financial guarantee letter to cover any damage caused by an accident during transportation.

    Before this, Bangladesh Atomic Energy Commission Chairman Prof Dr Ashoke Kumar Paul wrote to the science and technology ministry in this regard.

    It should be noted that, as per the Inter-Governmental Agreement between Bangladesh and the Russian Federation, and the General Contract signed between the Bangladesh Atomic Energy Commission and the Russian contractor AtomstroyExport, the civil liability for nuclear damage lies with the Bangladesh side.

    In light of the International Conventions on Civil Liability for Nuclear Damage and the National Nuclear Regulatory Law, there are provisions to hold the operator or licensee of a nuclear power plant fully responsible for the commissioning, operation, maintenance, supervision, and transportation of nuclear materials and fuel in any nuclear accident-related damage at the nuclear facility.

    The Rooppur Nuclear Power Plant is a significant project being implemented through an agreement between the governments of Bangladesh and the Russian Federation.

    The 2,400MW nuclear power project worth $13.5 billion is the biggest and the costliest power project in the country. Its construction began in 2017.

    Although the upfront cost of this plant is very high, the project’s 60-year lifespan is expected to give a cheap and emission-free power supply in the long run.