Russia’s Rosatom sues Finnish firms for $2.8bn over terminated nuclear plant contract

Rosatom is seeking compensation for losses caused by what it called the “unlawful termination of the EPC contract” to construct the Hanhikivi-1 nuclear plant.

The contract to build 1.2-gigawatt plant with investments estimated at €6.5-7 billion euros was signed in 2013, but the Finnish side terminated it in May 2022, before construction started.

The decision came after significant delays to the project, geopolitical risks due to Russia’s invasion of Ukraine, and doubts about the possibility of starting the project.

Fennovoima, a consortium in which Finnish stakeholders including Outokumpu, Fortum and SSAB own two thirds, had launched international arbitration, aiming to return of €1.7 billion of advance payments. Rosatom filed counterclaims for €3 billion in total. The cases are under arbitration in international courts.

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.