Russia to Challenge Finland's Breach of Hanhikivi-1 NPP Deal in Arbitration

MOSCOW (Sputnik) - Finland’s unilateral termination of contract with Russian state nuclear corporation Rosatom for the construction of the Hanhikivi-1 nuclear power plant (NPP) will be assessed by an international arbitration court, Russia's trade representative in Finland, Anton Loginov, told Sputnik on Wednesday.

"This is a blatant case of [Finnish nuclear power company] Fennovoima unilaterally breaking the agreement with Rosatom. The trade mission accompanied the project and assisted it since the announcement in 2013, as well as kept in touch with the local administration. Excavations were actively underway at the site. Construction could have started by the end of the year," Loginov said.

The official specified that 90% of the equipment was contracted, about 1.7 billion euro ($1.75 billion) were invested and the Russian side fulfilled its obligations in full.

"And suddenly the Finnish side made such a decision. I know that Rosatom tried to resolve the issue through negotiations and there were several attempts at a dialogue. But the proposal did not find understanding on the Finnish side, so international arbitration will take care of the case. We hope that, despite the current difficult situation, this case will be considered impartially," the envoy said.

Rosatom chief Alexey Likhachev called Finland’s decision to terminate the Hanhikivi-1 contract "strange" and said that Russia would seek clarifications. The Russian foreign ministry said Fennovoima was likely pressured into making the "political decision" of terminating the contract.

The Hanhikivi-1 project entailed the construction of a one-unit NPP based on the state-of-the-art Russian reactor VVER-1200, with the capacity of 1,200 MW. Fennovoima was the customer, owner and operator of the future NPP, while Rosatom's subsidiary RAOS Project was the general contractor. The project was at the stage of licensing and preparatory works at the construction site when the contract broke.