Prime Minister Chung expressed his own interest in following through on a potential agreement with Alternate Energy Holdings as soon as possible
- By Linton Levy -
Alternate Energy Holdings, Inc. CEO Don Gillispie remains in negotiations with Korean officials over the importing of Korean-made nuclear reactors into the U.S. market. It was a focus of a recent week-long trip to Korea, during which Gillispie also met with officials with KEPCO (Korea Electric Power Corporation). While there, Gillispie also met with Korean Prime Minister Un-Chan Chung. During that meeting Chung expressed his own interest in following through on a potential agreement with Alternate Energy Holdings as soon as possible. This proposed agreement has been one of great discussion for the past year. During that time Gillispie has worked with Korean officials on the benefits of exporting their advanced reactor. In a previous statement, Gillespie said, "We are pleased to have played a small part in encouraging the Koreans to export their superior reactor and now we would like to complete our negotiations to bring the APR 1400 into the U.S. for the first time including helping achieve NRC design certification." If Gillispie is successful in his talks with Korea, it would mean an eventual partnership that would include commissions for AEHI on any Korean-made reactor sold in North America. Word of Gillispie's trip to Korea was also one of intense media interest. He was interviewed for the largest television station in Korea (SBS), as well as the biggest newspaper (The Chosunilbo Daily). Although produced in the Korean language, the story and portions of the interview can be seen here. The Korean-made APR 1400 has been of great interest lately. It is the same reactor currently in production under an agreement with the United Arab Emirates (UAE). In late December Korea signed a $20.9 billion deal to build four reactors for the UAE. The reactor is not only of the highest quality, but it sells for billions of dollars less than its competitors. Alternate Energy Holdings develops and markets innovative clean energy sources. The company is the nation's only publicly traded independent nuclear power plant developer willing to build power plants in non-nuclear states. Other projects include, Energy Neutral which removes energy demands from homes and businesses (www.energyneutralinc.com), Colorado Energy Park (nuclear and solar generation), and International Reactors, which assists developing countries with nuclear reactors for power generation, production of potable water and other suitable applications. AEHI China, headquartered in Beijing, develops joint ventures to produce nuclear plant components and consults on nuclear power. AEHI Korea, Seoul, is helping negotiate with KEPCO.
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This article looks like nothing more than an AEHI press release, and apparently ignores the fact that KEPCO--the company that developed the APR-1400--has stated that AEHI does not have the capability of building nuclear power plants. And considering that AEHI has never been substantively involved in any nuclear plant certification or licensing activities in the US, it is difficult to see how its involvement could help the APR-1400 "achieve NRC design certification."
Curious, too, that "Nuclear Street" is so interested in promoting AEHI. Perhaps the publisher should take a little closer look at the facts.
Actually Koreans are skeptical of AEHI.
It looks as though Anuke and Curious are interested in spreading rumors and hearsay.
Anuke says that it is a fact that KEPCO "has stated that AEHI does not have the capability of building nuclear power plants". Yet, Anuke can provide no reference or weblink to support this claim.
Curious seems to think that all Koreans are skeptical of AEHI. If that were true, then why has AEHI's CEO been written up in the Korean Times, been on Korean national TV and met with the Prime Minister of the entire nation this week?
If Anuke is so curious about facts, then minor research of AHEI's Board of Directors would show that the company has been substantially involved nuclear certification and licensing. And, with reference to researching their site, you can see that they have been involved with Korean companies for well over a year.
And Curious, saying that Koreans are skeptical of AEHI is nothing short of a racist comment.
From The Korea Times, 1/8/10:
However, KEPCO said nothing concrete has been discussed during Gillispie’s visit.
“We don’t see much likelihood of a deal,” a KEPCO spokeswoman told The Korea Times. “I’m afraid AEHI is going a bit too far in promoting it.”
“The nuclear industry deals with massive projects and is sensitive to safety. If we are to strike a deal with a private company, we would want a more sizeable one,” she said. AEHI is relatively small with a capitalization of just $200,000
And as far as AEHI's "involvement" in nuclear certification and licensing is concerned, what I said was correct: the company, as such, has had none. The experience of (some) individual Board members is an interesting sidelight, but I don't recall ever seeing a sitting Board member of any company serving as a licensing manager for an NRC review. (As far as I can tell, the company has essentially no staff, since it has essentially no revenue--see below--to pay them.)
The company's latest quarterly SEC filing shows no revenue, and stockholder equity of about $90,000. Its current stock listing shows its market capitalization at about $80,000. Its stock sells for 11 cents a share. Where is it going to raise the $50-100 million required to complete an NRC combined license review, not to mention the $4-6 billion needed to build a new plant? The only thing it does seem to have going for it is an active PR machine that churns out glowing press releases (used as the basis for the articles in this blog).
The rosy picture of AEHI's activities represented in this blog is at odds with what I think is a far more realistic view of the situation in The Energy Collective. (theenergycollective.com/.../55974).
I deal in facts, not wishful thinking. But, hey, slevine and Abby, you can believe what you want.
Lest I be accused again of "spreading rumors and hearsay," the following paragraphs are copied verbatim from AEHI's latest quarterly filing with the SEC, found at (among other places):
THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM'S REPORT ON THE COMPANY'S FINANCIAL STATEMENTS AS OF DECEMBER 31, 2008, AND FOR EACH OF THE YEARS IN THE TWO-YEAR PERIOD THEN ENDED, INCLUDES A "GOING CONCERN" EXPLANATORY PARAGRAPH, THAT DESCRIBES SUBSTANTIAL DOUBT ABOUT THE COMPANY'S ABILITY TO CONTINUE AS A GOING CONCERN.
(The "all caps" font is in the original report.)
NEED FOR ADDITIONAL FINANCING
We do not have capital sufficient to meet our cash needs. We will have to seek loans or equity placements to cover such cash needs. Once exploration commences, our needs for additional financing is likely to increase substantially.
No commitments to provide additional funds have been made by our management or other stockholders. Accordingly, there can be no assurance that any additional funds will be available to us to allow it to cover our expenses as they may be incurred.
In addition, the United States is experiencing severe instability in the commercial and investment banking systems which is likely to continue to have far-reaching effects on the economic activity in the country for an indeterminable period. The long-term impact on the United States economy and the Company's operating activities and ability to raise capital cannot be predicted at this time, but may be substantial.
A company that does not have sufficient capital to meet its cash needs and whose independent auditors have expressed "substantial doubt" about its ability to continue to operate strikes me as a rather poor bet to complete a nuclear power plant project--assuming the NRC would find it qualified to submit a license application in the first place. See NRC regulation 10 CFR 50.33(f), which states that an application must include:
"Except for an electric utility applicant for a license to operate a utilization facility of the type described in [paragraphs] 50.21(b) or 50.22, information sufficient to demonstrate to the Commission the financial qualification of the applicant to carry out, in accordance with this regulations in this chapter, the activities for which the permit or license is sought."
Considering that the SEC has now filed fraud charges against AEHI, I wonder if "slevine" and Abby Gessner would care to reconsider their comments from January.