Paks II

Company owned by pro-Orban businessman expected to win €110 million soil improvement job at the Paks II NPP site

Soil-related problems regarding the expansion of the Paks nuclear power plant have been in the limelight in 2018: according to the Hungarian Atomic Energy Authority, the ground beneath the 4th reactor block has moved minimally. Soil improvement works worth €110 million are needed before the construction of the two new reactor blocks can start. Duna Aszfalt, a company owned by a businessman close to PM Viktor Orban, has a good chance of getting the job.

The Hungarian government announced in January 2014 that Russian company Rosatom is going to expand the existing nuclear plant in Paks. Two new reactor blocks are going to be built right next to the four existing reactor blocks.

The project has been controversial from the beginning because of its lack of transparency. Also, Atlatszo revealed last year that new site does not comply with IAEA seismic safety standards.

The two new reactor blocks are going to be built only a few hundred meters away from the 4th block. According to experts, the soil improvement work is essential for the safety of the entire Paks Nuclear Power Plant expansion project. The work is worth 35.7 billion Hungarian forints, about 8.5 billion Russian rubles or 110 million euros at today’s exchange rate.

An Italian, a Russian and three Hungarian companies have bid on the soil improvement tender announced by one of Rosatom’ s subsidiaries. Duna Aszfalt, led by László Szíjj, seems to have the best chance to win the tender for the soil improvement job.

Gábor Timár, associate professor and head of the Eötvös Loránd University’s Department of Geophysics and Space Sciences, explains the logistics of the job.

The upper 20 meters of the soil at the construction site must be removed, as it might be affected by a possible earthquake and a subsequent soil flow. Construction of the new reactor block can only be started after this layer is removed.

A danger of soil flow has been confirmed by the preliminary research that examined the geological characteristics of the area.

Átlátszó published a series of articles in 2017 in which experts claim that the new reactor blocks are planned to be built on a tectonic fault line. Timár recommends building the new blocks at least 100 meters north from the current site.

A danger of shifting groundwater levels

Timár said that the soil improvement work does not require an experience in nuclear sciences, but it does require expertise in soil mechanics and soil engineering. When the soil is removed, as mentioned above, and the pit for the new reactor block is being constructed, there is a danger of groundwater entering the pit.

However, if the water is simply pumped out of the pit, groundwater from below the 4th block might leak into to the hole. That would cause skewed groundwater levels under the 4th block, which might cause that reactor block to shift. That is a scenario that has to be avoided at any cost.

Timár, therefore, recommends that the new excavation site and the old nuclear blocks be isolated underground as well, to avoid the aforementioned effect.

“We do not want to have different levels of groundwater under the two sides of the same building, even if it is only a few centimeters or decimeters. Especially if the building is hundreds of meters long, weighs hundreds of thousands of tons and it is an actual nuclear plant in operation” – said Timár.

This is the job, more or less, that needs to be done and what Atomkomplekt, a subsidiary of Rosatom has announced a public tender for.

Two of the three Hungarian bidders are close to Lőrinc Mészáros

An Italian, a Russian and three Hungarian companies have bid on the contract. Bauer Magyarország Kft, one of the Hungarian bidders is a subsidiary of a German company.

The second Hungarian bidder, A-híd Zrt., belongs to the Apáthy family, and it is a frequent consortium partner of companies that can be linked to Lőrinc Mészáros.

The third Hungarian bidder is Duna Aszfalt, owned by László Szíjj. He also works regularly with Mészáros’s companies.

Átlátszó’ sources, requesting anonymity, agreed that Duna Aszfalt is the Hungarian government’s preferred candidate for the job. Our sources also confirmed that Duna Aszfalt does actually have the best chance of winning the contract.

We reached out to Duna Aszfalt and got the following reply: “The decision-making process for public tenders of this size often has two phases. The first phase is a pre-classification of the bidders, where the competences of the bidders are measured. The second phase discusses the costs of the construction. Before the final decision, the bidder undergoes an audit where its technical expertise and human resources are evaluated together with its financial capabilities. The bidders are graded on a scale of 0 to 100 points. We are proud of having reached 100% at the audit phase.”

Átlátszó was informed by market sources that Duna Aszfalt has started hiring engineers at a surprising speed. We asked Duna Aszfalt about this but they did not give a straight answer to our question. However, they confirmed that their HR readiness was considered 100% during the audit as well.

According to its annual report, the company already had 300 employees at the end of 2017, half of them white-collar workers. This means that they might have an appropriately sized team of engineers.

Duna Aszfalt was the only company to get back to Átlátszó in a timely manner.  Rosatom promised to answer “as soon as they can”, but they have not done so until now. Bauer Magyarország has not replied to our email and phone messages yet. We also inquired at the  Magyar Állami Paks2 Zrt., but we received no reply.

A public tender that was silently canceled

This is not the first public tender for the soil improvement job. Rosatom had published one before, in August 2017.

That tender, however, was only a call for the planning of the soil improvement works, plus certain works “at an experimental site.” That was a much smaller tender as well, worth only 99 million rubles. The company called Bauer Magyarország bid for this job as well.

An industry source told us that it makes sense to have to different tenders for this job, one for the planning and one for its execution.

It is simply smarter not to have the same company do the planning and the construction project as well.

Bauer Magyarország Kft. was bidding in 2017 for the planning phase. The website of Rosatom shows that the tender got suspended in 2017 October after one of the bidders appealed. After the appeal was denied, Atomkomplekt evaluated the remaining bidders in 2017 November. A Russian company and Bauer Magyarország were the only bidders at the time, but the former did not have any previous experience in Hungary or in the European Union.

This means that Bauer Magyarország Kft. was supposed to win the contract. However, there has been no communication about the tender by Rosatom since then. There were no news about Bauer signing the contract or about a cancellation of the tender.

However, the new and much bigger tender was announced, this time for the soil improvement works. This is why we asked both Rosatom and Bauer Magyarország why there were two tenders, what happened to the previous one and how they are different from each other.

Our sources in the construction industry have an explanation: that a new tender needed to be announced so that Duna Aszfalt can apply and have a better chance at winning.

Written by Antónia Rádi

English version by Zsuzsanna Liptákné Horváth. You can read the original, Hungarian-language story here.

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