Moon's Reactor Reversal Sends Korean Construction Firms Soaring
Korea's Moon to `Respect' Advice to Resume Building Reactors
(Bloomberg) -- South Korean President Moon Jae-in’s support of a government panel to resume building two stalled nuclear reactors sent shares of engineering and construction companies surging.
The recommendation released Friday on the $7.5 billion project came after a nine-member committee gathered public opinion over the past three months about the permanent suspension of the Shin Kori No. 5 and 6 reactor construction, which Moon had proposed during his presidential campaign.
"We respect the will of the public-discussions committee that has deliberated on this for the past three months," Park Soohyun, Moon’s spokesman, said in a briefing Friday.
Kepco Engineering & Construction Co. surged as much as 20 percent, Doosan Heavy Industries & Construction Co. gained as much as 12 percent and Kepco Plant Service & Engineering Co. jumped more than 9 percent. Korea Electric Power Corp., the utility known as Kepco, added as much as 5.6 percent.
Moon campaigned on the platform of halting construction at the two reactors, as well as eventually phasing out nuclear power. Shutting all of the nation’s nuclear plants will take more than 60 years, he said in August. In its place, Moon would put greater emphasis on natural gas and renewables.
Even if construction resumes, it will have limited impact on the expansion of renewable energy generation in the country, Jung Yeon-Seung, an analyst at NH Investment & Securities, wrote in a note Friday.
South Korea has 24 nuclear reactors, which provide roughly a third of its energy needs, according to the World Nuclear Association. The Asian nation has the sixth-largest fleet of nuclear reactors in the world, accounting for about 23 gigawatts of capacity.
--With assistance from Stephen Stapczynski and Kanga Kong
To contact the reporters on this story: Heesu Lee in Seoul at hlee425@bloomberg.net, Heejin Kim in Seoul at hkim579@bloomberg.net.
To contact the editors responsible for this story: Ramsey Al-Rikabi at ralrikabi@bloomberg.net, Divya Balji at dbalji1@bloomberg.net, Aaron Clark