Rosatom sues Finnish firms $2.8B over nuclear plant contract

Russia’s Rosatom has filed a lawsuit in Moscow against Finland’s Fortum and Outokumpu, demanding 227.8 billion roubles ($2.8 billion) in compensation for losses over the termination of a contract for the Hanhikivi-1 nuclear power plant in Finland, Rosatom’s statement and court documents show.

Rosatom and its former Finnish partners have been in dispute over the cancelled contract since May 2022, when the Finnish side terminated it soon after the 2022 Ukraine conflict began, citing significant delays, political risks and doubts about the possibility of delivering the project.

Rosatom is seeking compensation for losses caused “by the unlawful termination of the EPC contract” for the construction of the nuclear power plant, “violations of the shareholder agreement, the fuel supply contract and the refusal to repay the loan”, Rosatom said on Monday.

Outokumpu said it was never a direct party to the EPC agreement or any other agreement with any Rosatom company related to the Hanhikivi-1 project.

The contract to build the 1.2 gigawatt plant with investments estimated at 6.5-7 billion euros was signed in 2013 with Fennovoima, a joint consortium in which Finnish stakeholders including Outokumpu, Fortum and SSAB originally controlled two thirds through a joint venture, and the Russian side held one third.

After the project termination, Fennovoima has ceased all its operations and is only engaged in the legal dispute.

“This is a complex international contractual matter, and Moscow is not the appropriate venue to address the related disputes,” Outokumpu said in a statement.

Both Outokumpu and Fortum said they had not received any official notification regarding the new claim by Rosatom.

In 2022, the counterparts had launched international arbitration, with Fennovoima seeking the return of more than 1.7 billion euros of advance payments. Rosatom filed counterclaims for 3 billion euros in total. The cases are under arbitration in international courts.

Fortum said the matter was in arbitration proceedings in the International Chamber of Commerce, adding the court in February ruled against Rosatom subsidiary’s request to make Fortum a party in the proceeding.

“The arbitral tribunal’s decision on this matter is final,” Fortum said in an emailed statement to Reuters.

Fortum was a major foreign investor in Russia’s energy sector; however in 2023 it lost control of its Russian assets, when Russia temporarily took over seven thermal power units and a joint-venture portfolio of wind and solar plants from Fortum under a decree by President Vladimir Putin.

(By Anastasiya Lyrchikova, Anne Kauranen and Gleb Stolyarov; Editing by David Evans and Louise Heavens)