April 2006

2

PART I : Status of nuclear industry in Korea

PART II : Romania-Korea Cooperation status

PART III : Cooperation with Korea

PART I : Status of nuclear industry in Korea

PART II : Romania-Korea Cooperation status

PART III : Cooperation with Korea

PART I

STATUS OF NUCLEAR INDUSTRY IN KOREASTATUS OF NUCLEAR INDUSTRY IN KOREASTATUS OF NUCLEAR INDUSTRY IN KOREASTATUS OF NUCLEAR INDUSTRY IN KOREA

4

Status of Electric Power

28.5%(17,716)

28.9%(17,965)

26.6%(16,552)

7.4%(4,605)

6.2%(3,885)

40.3%(146,779)

36.6%(133,657)

16.0%(58,250)

4.8%(17,883)

1.4%(5,153)

*The others : 1,537 MW(2.5%) *The others : 3,349 GWh(0.9%)

(As of the end of 2005)

Nuclear

Coal

Gas

Oil

HydroTotal : 62,260MW Total : 364,571GWh

5

Installed Capacity

0

10

20

30

40

50

1961 1991 2005

Nuclear Coal Oil Gas Hydro

367MW

Cap

acit

y

X 1,000 MW62,260 MW

28.5%

28.9%

7.4%

26.6%

6.2%

21,111MW

9,835MW

19811971

2,628MW

2001

50,858 MW

27.0%

30.5%

9.6%

25.3%

7.6%

6

Hydro Oil Gas Coal Nuclear

Long-term Power Development Plan

X 1,000 MW

90

Cap

acity

30

40

50

60

70

80

62,260MW

0

10

20

(26.6%)

78,630MW

(26.1%)

86,340MW

(26.8%)

88,040MW

(26.3%)

17,716(28.5%)

18,716(23.8%)

26,640(30.9%)

26,640(30.3%)

(28.9%)(30.9%)

(25.7%) (25.3%)

(7.4%)

(6.2%)(2.7%) (3.8%)

(6.2%)

(8.0%)

(7.3%)

2005 2010 2015 2017

(7.1%)

7

Status of Nuclear Power Plants

Seoul Ulchin #1 6∼

Kori #1 4∼► Shin Kori #1~2

Wolsong #1 4∼► Shin Wolsong #1,2

Yonggwang #1 6 ∼

SiteSite In OperationIn Operation Under Const.Under Const. TotalTotal

Kori 4 (3,137) 2 (2,000) 6 (5,137)

Wolsong 4 (2,779) 2 (2,000) 6 (4,779)

Yonggwang 6 (5,900) - 6 (5,900)

Ulchin 6 (5,900) - 6 (5,900)

TotalTotal 20 (17,716)20 (17,716) 4 (4,000)4 (4,000) 24 (21,716)24 (21,716)

(Unit: MW)

(As of the end of 2005)

8

In Operation

NSSS: Nuclear Steam Supply System, A/E: Architectural Engineering

20 units (17,716 MW)

Plant ReactorType

Capacity(MW)

NSSSSupplier

PlantA/E

CommercialOperation

PWRPWRPWRPWR

650587950950

W/HW/HW/HW/H

GilbertGilbert

Bechtel/KOPECBechtel/KOPEC

Apr. ’78July ’83Sep. ’85Apr. ’86

#1#2#3#4

Kori

Korea has accumulated experience in various type of reactors

PHWRPHWRPHWRPHWR

679700700700

AECLAECL/DOOSANAECL/DOOSANAECL/DOOSAN

AECLAECL/KOPECAECL/KOPECAECL/KOPEC

Apr. ’83Jun ’97Jun. ’98Sep. ’99

#1#2#3#4

Wolsong

PWRPWRPWRPWRPWRPWR

950950

1,0001,0001,0001,000

W/HW/H

DOOSANDOOSANDOOSANDOOSAN

Bechtel/KOPECBechtel/KOPEC

KOPECKOPECKOPECKOPEC

Aug. ’86Jun ’87Mar. ’95Jan. ’96May. ’02Dec. ’02

#1#2#3#4#5#6

Yonggwang

PWRPWRPWRPWRPWRPWR

950950

1,0001,0001,0001,000

FramatomeFramatomeDOOSANDOOSANDOOSANDOOSAN

FramatomeFramatome

KOPECKOPECKOPECKPPEC

Sep. ’88Sep ’89Aug. ’98Dec. ’99July. ’04Apr. ’05

#1#2#3#4#5#6

Ulchin

9

Under Construction/Planning

8 units 9,600 MW

* OPR : Optimized Power Reactor, APR : Advanced Power Reactor

Today, Korean companies are taking the leading role in NPP Projects

Construction

Plant Type Capacity (MW)Reactor TypeProject

PWR

PWR

1000

1000

OPR1000

OPR1000

Dec. 2010

Dec. 2011

#1

#2

Shin-Kori

RemarkCommercial Operation

ConstructionPWR

PWR

1000

1000

OPR1000

OPR1000

Oct. 2011

Oct. 2012

#1

#2

Shin-Wolsong

PlanningPWR

PWR

1400

1400

APR1400

APR1400

Dec. 2014

Dec. 2015

#1

#2

Shin-Ulchin

PlanningPWR

PWR

1400

1400

APR1400

APR1400

Sep. 2013

Sep. 2014

#3

#4

10

Nuclear Power Development Plan

Ulchin 3&41998 / 1999

2002

Yonggwang 3&41995 / 1996

Yonggwang 5&6

Ulchin 5&6

Shin-Kori 3&4Shin-Kori 3&4

Shin-Kori 1& 22010 / 2011

2013 / 2014

Shin-Ulchin 1&2Shin-Ulchin 1&2

2014 / 2015

APR 1400 NthAPR 1400 Nth

APR 1400 Development

Shin-Wolsong 1& 22011 / 2012

OPR 1000

(Operation)

OPR 1000(Construction)

APR 1400APR 1400

2004/2005

2010 2005 2000 1995 1990 2015

2006. 4

11

Site View of Kori

12

Site View of Wolsong

13

Site View of Yonggwang

14

Site View of Ulchin

15

Site View of Shin-Kori

RCBRCBUnit 2Unit 2

Unit 1Unit 1

16

Site View of Shin-Wolsong

17

Operational Performance

40

60

80

100

Unplanned shut down / Unit

Capacity Factor (Korea)

Unplanned shut down / Unit

Capacity Factor(%)

Capacity Factor (World Average)

95.5

779.39.3

0.5

0.6

91.4

0.6

94.2

0.4

92.7

0.50.50.50.90.41.10.91.10.91.61.7shutdown

95.593.290.488.390.387.687.587.387.487.284.5C.F.(%)

`92 `93 `94 `95 `96 `97 `98 `99 `00 `01 `02 `03 `04 `05

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Outstanding Performance in 2005

KHNP’s 5 units take all the top five spots on the list of 50 best capacity factors

World Generation Ranking : - No. 1 : Kori #4 (104.85%)- No. 2 : Younggwang #3 (104.14%)- No. 3 : Ulchin #1, YGN #1 (103.80%) (* two units in third )- No. 5 : Wolsong #3 (102.29%)

World Generation in 2005 (Nucleonics Week, ’06.2.9)

19

1

2

3

4

679

700

700

700

AECL

AECL

/ Doosan

〃

〃

NEI-

Parsons

Doosan

/ GE

〃

〃

Apr ’83

Jun ’97

Jun ’98

Sep ’99

Turnkey

Non-

Turnkey

〃

〃

May ’77

Oct ’91

Aug ’93

Aug ’93

71

68

73

58

UnitCapacity

(MWe)

Manufacturer

Reactor T/G

Contract

Type

Construction Period

Outlines of Wolsong CANDU NPPs

Excavation COD Months

20

Period

Performance of Wolsong CANDU NPPs

Unit World Rank (*)Capacity Factor (%)

( *) : The number of NPPs in the world

#1

#1

#1

#1

#1

#1

#3

#4

Apr 1, ’85 ~ Mar 31, ’86

Apr 1, ’89 ~ Mar 31, ’90

Jul 1, ’91 ~ Jun 30, ’92

Oct 1, ’91 ~ Sep 30, ’92

Jan 1, ’93 ~ Dec 31, ’93

Jan 1, ’97 ~ Dec 31, ’97

Jul 1, ’98 ~ Jun 30, ’99

Oct 1, ’99 ~ Sep 30, ’00

98.40

99.13

98.30

98.00

100.81

102.12

100.70

102.90

1(277)

2(341)

2(356)

1(360)

1(421)

2(427)

1(376)

1(417)

21

ROMANIA-KOREA COOPERATION STATUSROMANIA-KOREA COOPERATION STATUSROMANIA-KOREA COOPERATION STATUSROMANIA-KOREA COOPERATION STATUS

PART II

22

History for Cooperation

2001. 3 MOU was signed between MOIR-Romania and KHNP for cooperation in Nuclear Power Projects

2002. 3

2003. 7MOU was signed between MOIR-Romania andMOCIE-Korea for cooperation in Cernavoda nuclear projects

Technical Cooperation Agreement was signed betweenSNN and KHNP

2001. 3~2005. 12

Romanian key persons visited Korea to discuss to enhance mutual cooperation in Cernavoda Projects, including Minister of Foreign Affairs, President of Senate, etc.

2001. 10 RAAN supplied 16 tons of heavy water to KHNP

23

History for Cooperation (Con’d)

2003. 7

2003. 11

2004. 5

2004. 8

MOU was signed at 1st Romania-Korea Industrial Cooperation Committee(ICC) in Bucharest

RAAN supplied 16 tons of heavy water to KHNP

Romanian high level and working level delegations visitedKorean nuclear industry, including State Secretary of MOEC

2005. 10 Romanian President, Mr. Traian Basescu visited Korea (10.18~ 10.19) and talked with KHNP CEO, Mr. Lee Joong-Jae.

2004.2 Nuclear Cooperation Agreement was signed by both gov’ts

2005. 6 2nd Korea-Romania ICC was held in Seoul

24

25

Technical Assistance Agreement (TAA) for Units 1, 2 wassigned between SNN & KHNP in March ’02

Technical Assistance for Units 1,2

Owner consulting services for schedule control for Unit 2- 2 KHNP experts were dispatched to Cernavoda in May ’02- Contributed to significant reduction of construction schedule

PSA Services for Part 1 (Fuelling related Systems) for Unit 2 - Contract award to KHNP in November ’05

To expand technical cooperation areas- Greatly contribute to enhance economy and safety of Unit 1 operation

and Unit 2 construction- PSR, design modifications, training, commissioning, etc.

26

Joint Study Team - SNN (Leader), KHNP, AECL & Ansaldo- Financial Advisor (Phase 2 only)

Phase 1 Study from March to September ’03- Technical, economic advantages of the Project were proven- Results were approved by Inter-Ministerial Committee in December ’03

Phase 2 Study in progress from October ’03

- To establish appropriate financing model and to draw project ownership - 7 potential investors in equity of Project Company, including KHNP,

were selected (November ’04)

Joint Development of Units 3,4 Project

Phases 1 and 2 Joint Feasibility Study

27

• As a major shareholder of PCO and the major participants in

EPC/O&M, provided that the appropriate securities are

established

- Reliable long term PPA

- Licensing, Public Acceptance and Political Risk

- Nuclear Liability and Radwaste Disposal

- Protection of Investors against bad financial situation of PCO, etc.

Joint Development of Units 3,4 Project (Con’d)

KHNP's Indication of Interest under JVPC※ Model (March '06)

※ JVPC : Joint Venture Project Company

28

Joint Development of Units 3,4 Project (Con’d)

Cooperation with Korea in Units 3,4 Project

Korea’s involvement in Unit 3,4 will certainly contribute to

constructing the most successful plant with the highest

economy and safety in the world

29

Joint Development of Units 3,4 Project (Con’d)

Cooperation with Korea in Units 3,4 Project (Cont’d)

Korea is the best partner to Romania for Cernavoda Project

- Benefiting from its world-top class technologies and experience gained through continuous implementation of 20 NPP projects, including 4 CANDU units, for more than 30 years

- Korean nuclear industry with systematically established infrastructure is willing to share its technologies with Romania in every field of nuclear power project implementation

30

COOPERATION WITH KOREACOOPERATION WITH KOREACOOPERATION WITH KOREACOOPERATION WITH KOREA

PART III

31

Increased Necessity of Nuclear Power

Rapid increase of energy price

Environmental regulation (Kyoto Protocol)

Instability of energy supplies

Securing of stable energy source in the medium and long terms

Introduction of NPPs considering each country’s own energy

circumstances

Circumstances of Energy in the World

Global Renaissance of Nuclear Power

32

Strength of Korean Nuclear Industry

Continuous and intensive implementation of NPP Projects since introduction of first NPP in the 1970’s

Steady and definite policy in Nuclear Power Projects

Systematically established nuclear power infrastructure

Steady and definite policy in nuclear power project

33

Cooperation with KHNP

NPP TechnologyNPP TechnologySelf-reliance & LocalizationSelf-reliance & Localization

Training Program

F/S for OPR1000

Technical Assistance

Sharing Korean Experience & Resources

Joint VentureT/T & T/A

Near-termCooperation

Long-termCooperation

34

Benefits of Cooperation with Korea

• Latest and Proven Technology

• Favorable Financing

• Korean Experience of Localization

35