Canada Signs $3-Billion Support For Nuclear… In Romania

Canada and Romania have inked a significant $3-billion export development deal in which two state-of-the-art nuclear reactors will be constructed in Romania, a move intended to curb Russia’s ability to wield its energy exports as a geopolitical weapon.

Romanian Energy Minister, Sebastian Burduja, emphasized the paramount importance of this deal during a press conference held in Ottawa, stating, “This is first and foremost about energy security… not just for Romania, but the whole region.”

Romania, a European country, has already forged an agreement with its neighboring Moldova to share the power generated by these two new Candu reactors, which are anticipated to be operational by 2032. Furthermore, Romania is actively engaged in discussions with Ukraine, Hungary, and Austria for similar partnerships.

These new reactors will complement the two existing Candu reactors, which have been supplying electricity to southeastern Romania’s Cernavoda since 1996 and 2007, respectively. Together, they account for approximately one-fifth of Romania’s electricity generation capacity, with the two new reactors matching their scale.

Crucially, Romania is not dependent on Russia for any of its energy needs. However, as Burduja pointed out, by helping neighboring countries reduce their reliance on Russian energy, they aim to weaken Russian President Vladimir Putin’s ability to employ energy exports as a tool for geopolitical leverage, an approach he has not hesitated to employ in the past.

Canadian Energy Minister, Jonathan Wilkinson, disclosed that the financial support for this endeavor could reach up to $3 billion, enabling Romania’s national nuclear operator to procure supplies and services from Canadian companies. This funding will be sourced partly from Export Development Canada and partly from the Canada Account, which supports export financing deemed to be in Canada’s national interest.

Wilkinson underscored the significance of this agreement, linking it to Canada’s commitment made in 2022, following Putin’s incursion into Ukraine. Canada pledged to collaborate with European allies to help them replace Russian energy sources, primarily focusing on natural gas, which many European nations heavily rely on. Although Canada sought to increase natural gas exports to Europe, its limited capacity to ship gas directly to Europe necessitates routing supplies mainly through the United States.

In contrast, nuclear power has been a Canadian success story, with the Candu reactors developed several decades ago. This achievement has positioned Canada as a valuable partner in nuclear energy discussions with other countries, including Poland. Notably, ambassadors from Ukraine, Poland, Finland, and other nations attended the signing ceremony for the Canada-Romania nuclear deal, underscoring its broader regional significance.

Burduja also highlighted Romania’s foresight in the 1970s when, instead of opting for Russian nuclear technology as many European nations did, they chose Canada’s version. Today, this decision stands as a prescient one, as it shields them from the complexities of relying on Russian-based nuclear power plants in the current geopolitical landscape.

Earlier in April, Prime Minister Justin Trudeau announced plans to revive nuclear energy production in a bid to reduce its reliance on fossil fuels. He highlighted that nuclear energy will play a key role in decarbonizing the country’s energy mix, with Canada investing in small modular reactors.

Information for this story was found via the The Globe and Mail and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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