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Argentina will turn to a US investor and small modular reactor technology to expand its nuclear energy sector, a top adviser to President Javier Milei has said, potentially spelling the end for a Chinese project on the same site.
Demian Reidel, who leads the libertarian government’s nuclear power policy, said Milei would hand over the Buenos Aires province site earmarked for the country’s fourth plant to a 1.2GW project designed by Argentine research facility Invap, which will use the nascent SMR technology.
“The design is Argentine and the capital to develop will be American — 100 per cent private direct foreign investment,” said Reidel, without naming the investor who will form a joint venture with Invap. “We think we can have the first plant online by 2030. From there things will move faster and we will become an SMR [technology] exporter.”
Milei and Reidel unveiled a plan to increase Argentina’s nuclear power generation and uranium mining capacity on Friday, aiming to lure technology companies that are increasingly using energy-intensive artificial intelligence to set up data centres in the country’s cooler south.
“My dream is to have a place in Patagonia called Nuclear City, where you come with your project and you can just plug it in,” Reidel told the Financial Times. “The only thing that can supply the energy deficit created by the gigantic data centres the world needs is nuclear. It’s clean, stable and scalable.”
Demian Reidel: ‘What’s making this possible is the combination of fiscal discipline and a government that is actually business-friendly’
Reidel said tech groups were analysing data centre projects in Argentina and would announce investments “hopefully in 2025 . . . it’s a question of where, not if”. Those projects could develop before new nuclear plants come online, using energy from Patagonia’s rapidly growing shale gas production, he added.
Milei’s leftwing predecessor in 2022 announced an initial deal to build a $8.2bn Chinese-financed and designed conventional nuclear reactor on the same site as the new SMR project, known as Atucha 3.
While Milei has cooled campaign rhetoric criticising Beijing, the libertarian has presented his opposition to state-financed infrastructure and allegiance with the US as core parts of his ideology.
Argentina’s nuclear sector was the most advanced in Latin America, experts said, with three state-owned plants generating 8 per cent of the country’s electricity.
The country currently does not produce any uranium despite large reserves of the radioactive metal. One extraction project by Canada’s Blue Sky is at an advanced stage and was acquired this month by Corporación America, the Argentine conglomerate where Milei worked as an economist.
Argentina could feasibly become a crucial player in the next generation of nuclear reactors, analysts said. “This is not a crazy idea. From an energy point of view, Argentina has the expertise, the land [and uranium],” said Julián Gadano, a former nuclear energy secretary. “While I don’t think we’ll have the first SMR, we could be in the first batch.”
Some 80 SMR schemes were being developed worldwide, according to industry experts, as developers race to produce the first commercial-scale plant using the technology, which advocates say will be cheaper and safer than conventional nuclear reactors.
“The challenge will be overcoming investors’ lack of trust in Argentina and non-energy infrastructure challenges, like our limited broadband network, which will cost money,” Gadano added.
Many foreign investors say privately they are waiting for Milei to lift Argentina’s capital controls, and to see if his libertarian coalition does well at midterm elections in 2025, before investing. But an incentive scheme for big investments had drawn commitments of about $7.8bn in energy and mining projects this year, according to JPMorgan.
The International Atomic Energy Agency signed a memorandum of understanding with Milei’s government supporting the nuclear initiative on Friday.
Alfredo Caro, a research professor at George Washington University and former director of Argentina’s Balseiro Institute, which specialises in nuclear research, said Invap’s SMR design “is very competitive with the rest of the world’s SMR projects”.
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But he said it was “uncertain” how successful efforts to expand nuclear energy, which has so far been fully state-financed, would be, at a time when Milei’s austerity drive was creating “big budget problems” at the country’s three government-owned nuclear agencies and universities.
A separate publicly-financed Argentine SMR project, which has been stuck in the construction phase for a decade, has stalled this year amid budget cuts.
Reidel, who has a physics degree from the Balseiro Institute, argued that private sector investment would fuel the industry as the government scales back its role in the economy.
“What’s making this possible is the combination of fiscal discipline and a government that is actually business-friendly,” he said. “We’re open for business.”
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Publish date : 2024-12-20 11:20:00
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