VZCZCXRO6457
RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN
DE RUEHSA #3839/01 3060709
ZNR UUUUU ZZH
R 020709Z NOV 07 ZDK ZUI RUEACSA 1934 3061038
FM AMEMBASSY PRETORIA
TO RUEHC/SECSTATE WASHDC 2522
INFO RUCPDC/DEPT OF COMMERCE WASHDC
RHEBAAA/DEPT OF ENERGY WASHINGTON DC
RUCNSAD/SOUTHERN AF DEVELOPMENT COMMUNITY COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0690
RUEHRL/AMEMBASSY BERLIN 0562
RUEHBY/AMEMBASSY CANBERRA 0569
RUEHLO/AMEMBASSY LONDON 1352
RUEHMO/AMEMBASSY MOSCOW 0695
RUEHOT/AMEMBASSY OTTAWA 0523
RUEHFR/AMEMBASSY PARIS 1211
RUEHTN/AMCONSUL CAPE TOWN 5012
RUEHDU/AMCONSUL DURBAN 9321
RUEHJO/AMCONSUL JOHANNESBURG 7696

UNCLAS SECTION 01 OF 02 PRETORIA 003839 
 
SIPDIS 
 
SIPDIS 
SENSITVE 
 
STATE PLEASE PASS USAID 
STATE PLEASE PASS USGS 
DEPT FOR AF/S, ISN, EEB/ESC AND CBA 
DOE FOR T.SPERL, G.PERSON, A.BIENAWSKI, M.SCOTT, L.PARKER 
 
E.O. 12958: N/A 
TAGS: ENRG BEXP TRGY SENV KNNP EINV SF
SUBJECT: WESTINGHOUSE ACQUIRES LOCAL NUCLEAR SUPPLIER 
 
REF: A) Pretoria 3747 
B) Pretoria 3078 
C) Pretoria 3012 
 
PRETORIA 00003839  001.4 OF 002 
 
 
Not for internet distribution 
 
¶1.  (SBU) SUMMARY: Westinghouse expects to close its 
long-awaited acquisition of South Africa's IST Nuclear 
(ISTN) to augment its domestic footprint and to position 
itself for supplying an initial 3,200 MW of new nuclear 
power plants to state electricity company Eskom, as well 
as additional plants over the longer-term.  The 
acquisition shows Westinghouse's commitment to 
localization and building South Africa's local nuclear- 
industry capacity.  The acquisition also reinforces its 
support for the Pebble Bed Modular Reactor (PBMR).  End 
Summary. 
 
-------------------------------- 
Nuclear New Build - Neck in Neck 
-------------------------------- 
 
¶2.  (SBU) Westinghouse and Areva of France have been 
identified by Eskom and the SAG as the two likely vendors 
to build two-three new nuclear power plants totaling 
about 3,200 MW.  Eskom has stated that an investment 
decision should be made by March 2008.  The SAG intends 
to install 20,000 MW of nuclear power as part of an 
ambitious 40,000 MW expansion program over the next 
twenty years (reftels). 
 
---------------------------------------- 
Domestic Footprint Augments Localization 
---------------------------------------- 
 
 
¶3.  (SBU) Westinghouse Regional VP for South Africa Rita 
Bowser stated that the acquisition of South Africa's ISTN 
should be consummated by November 2, speaking in an 
interview with local Engineering News.  In the article, 
Bowser said the purchase is aligned to the aspiration to 
position the company for the likely pipeline of work in 
South Africa.  She said Westinghouse aimed to respond to 
the SAG's stated objective of seeking to build local 
nuclear industry capacity.  Bowser emphasized that the 
ISTN acquisition showed Westinghouse's commitment to 
localization.  In addition, she said Westinghouse 
intended to expand ISTN's scope to include work in 
servicing existing light water reactors in South Africa 
and elsewhere.  The name ISTN will change to Westinghouse 
Electric Company South Africa and Westinghouse's domestic 
employee base will be 118 people. 
 
---------------- 
Support for PBMR 
---------------- 
 
¶4.  (SBU) According to the article, the purchase of ISTN 
by Westinghouse is also an indication of the company's 
growing interest in, not just South Africa's conventional 
nuclear reactors, but also its Pebble Bed Modular Reactor 
(PBMR).  ISTN is already a leading provider of services 
and systems for the PBMR, in which Westinghouse, together 
with the Industrial Development Corporation, Eskom, and 
the SAG, holds equity.  Speaking to the a recent Idaho 
National Laboratory delegation, ISTN official Andrew 
Rossouw enthusiastically described the history and 
potential of PBMR, including his company's role as key 
supplier of testing facilities and equipment (Reftel A). 
 
¶5.  (SBU) COMMENT: The acquisition of ISTN demonstrates 
QWestinghouse's strength in localization.  Westinghouse 
also competes well on price, safety, modular design, and 
training.  Embassy is working closely with Westinghouse 
 
PRETORIA 00003839  002.4 OF 002 
 
 
on how best to support its bid.  The Economic Counselor 
will participate in some Westinghouse-sponsored events at 
the Corporate Council on Africa meetings November 15-16. 
 
 
BOST