Westinghouse wants more than $175 million a reactor to let Korea build the APR1400 in the US

Under the settlement agreement, Westinghouse is guaranteed a $175 million licensing fee and $650 million in services and fuel supply rights ^[1][3]. If both are per-unit figures, that is $825 million a reactor ^[16]. Cameco, which owns 49% of Westinghouse, put its own number on the same package. Westinghouse "will secure a compensation package of approximately $2 billion per APR1400 unit, combining intellectual property licensing fees, services and nuclear fuel supply rights," Cameco said in a statement ^[6]. That is about $1.18 billion a unit above the guarantees, or roughly 2.4 times their sum ^[17].

The gap can be read three ways. Cameco may be counting what Westinghouse expects to bill over a reactor's life, with fuel and services running above the guaranteed amounts, in which case the $2 billion and the agreement fit together. It may be the target, reached through a higher fee and an upward revision of the $650 million ^[1][3]. Or it may move: Cameco said the terms are not binding and may be adjusted after final negotiations ^[7].

I think the second reading is closest, because the fee is already protected against inflation. The agreement links it to prices from 2025, the year it was reached, so a demand above $175 million is a demand for a real increase ^[2]. Industry and Trade Minister Kim Jung-kwan said Westinghouse's concern is that the agreement could be rendered meaningless if American developers come to prefer the Korean reactor ^[14]. "Even in the U.S., there is a view that the APR1400 is better," he said ^[12]. The counter-case is that Cameco is an owner describing its own asset, and a lifetime revenue figure would be large without any change in terms. If the final agreement keeps the fee at the indexed $175 million, that reading wins.

Korea pays in work share as well as cash. The services list covers core systems where Korean firms are competitive, including the man-machine interface system and the nuclear steam supply system, and the larger Westinghouse's share grows, the less value added Team Korea keeps, according to The Seoul Economic Daily ^[4]. Korea needs to hold costs down and maximize its companies' participation to make the project commercially reasonable, the paper reported, while Westinghouse is asking for the opposite ^[15]. "If we hand over everything just because they allow us to build the APR1400, there would be nothing left for us," said Choi Sung-min, a professor of nuclear and quantum engineering at KAIST ^[9].

Seoul has already conceded that entry costs something. "Since a Korean reactor that could not enter the U.S. market is now being built, we are also discussing compensation to match," Kim said last month ^[13]. An industry official described the project as eight reactors ^[10]. At Cameco's figure that is about $16 billion to Westinghouse, against $6.6 billion under the written guarantees ^[18]. The governments gave themselves until the end of this year ^[8]. The official pointed to the UAE: "With the Barakah plant in the United Arab Emirates (UAE), even after the site and construction plan were all set, there were more than a year of behind-the-scenes negotiations before Korea was named the preferred bidder" ^[11]. "It is not easy for negotiations to build eight reactors to wrap up in a few months," the official said ^[10].