A landmark agreement has been signed for a R9 billion innovative nuclear reactor in South Africa. In this conversation with BizNews, the partners to that agreement Stephen Edkins and Warren La Fleur of Koya Capital and Dr. Kelvin Kemm of Stratek Global, share the details and provide a timeline. The First of a Kind (FOAK) Small Modular Reactor (SMR) will have the capacity to generate 100MW of heat and 35MW of electricity. It is expected to break ground before the end of the year. Apart from the South African market, there’s been “a lot of interest” in the venture, not only from African countries, but from countries like Australia, Canada, Indonesia, and the Middle East.
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Edited transcript of the interview ___STEADY_PAYWALL___
00:00:07:04 – 00:00:29:06
Chris Steyn: A partnership has been signed for a 9 billion rand innovative nuclear reactor in South Africa. The partners to that agreement are with us now. We welcome Stephen Edkins and Warren La Fleur of Koya Capital and Dr. Kelvin Kemm of Stratek Global. Welcome.
00:00:29:08 – 00:00:30:23
Dr. Kelvin Kemm: Thank you very much.
00:00:31:01 – 00:00:44:12
Chris Steyn: Dr. Kemm, may I start with you? Please enlighten us about the technology behind the small nuclear reactor system developed by your team in Pretoria.
00:00:44:13 – 00:01:07:20
Dr. Kelvin Kemm: Well, what’s happened was that South Africa became the first country in the world to start developing a small and modular reactor some 30 years ago. And this test turned out not to be a really good initiative because the rest of the world is following suit. And we can lay claim to the fact that the rule is simple initiatives around the world are now following us.
00:01:07:22 – 00:01:19:04
Dr. Kelvin Kemm: And so we’ve got a rather advanced system. Most of the other companies in the world are two years old or five years old, nothing like us having started 13 years ago.
00:01:19:06 – 00:01:22:22
Chris Steyn: Dr. Kemm, what is the global significance of this design?
00:01:23:00 – 00:01:42:09
Dr. Kelvin Kemm: Well, nuclear is becoming a big sink. There’s a lot of problems around the world at the moment with electricity. We are not the only one suffering. And the wind and solar is just not working out like a lot of people hope. It’s just too intermittent and needs too much control. And it’s nowhere near as cheap as it’s made out.
00:01:42:09 – 00:02:11:06
Dr. Kelvin Kemm: When you add all those system costs into it. And so, no, there’s been significant interest swinging towards nuclear power then, as my firm believes, that nuclear power will be the fundamental power system of the world in all four centuries time. And so we will and truly on the way to the right answer, the big reactors that we’ve had in the past, like the size of Koeberg, need to be on the coastline or they are very big, like to take advantage of the water cooling.
00:02:11:08 – 00:02:26:17
Dr. Kelvin Kemm: We designed one molecule that does not need to watch a cooling because of South Africa not having adequate water available inland. So we stupidly went to a gas-cooled technology anywhere you like. And so the significance of that is just very great.
00:02:26:19 – 00:02:33:20
Chris Steyn: Mr. Edkins, what convinced Koya to enter into this partnership?
00:02:33:22 – 00:02:58:04
Stephen Edkins: So I’ve been doing cleantech for over 20 years, as Kelvin has highlighted. You know, there are issues with solar and wind energy being sufficient on their own to power, to give energy security to all the countries in the world. And so I began looking seriously at nuclear, especially medium and small size solutions a few years ago.
00:02:58:06 – 00:03:29:07
Stephen Edkins: And I think finally we’re now at a situation where we are going to see a serious investment in these new solutions. And so we began a very, very detailed study of all the possible teams and technologies that exist in the world. And it’s our strong belief that the team with the technology which can be built today and we are sure that it’s going to be reliable and economic is the Stratek team.
00:03:29:09 – 00:03:43:01
Stephen Edkins: They also furthermore have the ability to produce the fuel that’s required. So they have basically they cover all the bases, they’re vertically integrated. And we know with this investment that they have all the pieces in place.
00:03:43:03 – 00:03:47:18
Chris Steyn: Mr. La Fleur, exactly what will Koya’s role be in this project?
Read more: South African farmers embrace nuclear solution amid blackout crisis – Francois Rossouw (SAAI)
00:03:47:20 – 00:04:24:19
Warren La Fleur: So our role is to help to get Stratek investor-ready. We’re going to be working with the team there to prepare them an organizational capacity perspective in addition to working with international investors to help to raise the capital that’s required to bring this dream to life. It’s super exciting because, you know, I think the first time I met Kelvin, I sort of saw passion.
00:04:24:21 – 00:05:06:21
Warren La Fleur: I saw, you know, a deep intellect. I saw somebody who, as you know, made this dream his life’s work. And working in deep tech. That’s what we look for in founders, right? So we look for people who not only have the smarts to do big things but also who will bring past along. And I think that when we saw those two things, the only thing we could then do is to think about is there a role that we can play with the limited knowledge that we have to enable companies like Stratek to realize the significant potential that nuclear could bring.
00:05:07:02 – 00:05:14:04
Chris Steyn: With the energy crisis in South Africa? I think the question on everybody’s lips will be, can you give us a timeline?
00:05:14:06 – 00:05:40:04
Stephen Edkins: Sure. So we’ve now completed all of our due diligence. It was really important. For instance, to visit the Pelindaba facility. I think that’s really strong evidence of the amount of work and investment that’s gone into small nuclear in South Africa. That investment was made by the South African government over a period of decades. And so we’re now confident that we can recommend this to our investors.
00:05:40:04 – 00:06:04:06
Stephen Edkins: This is something which we know is going to work when it gets built. The fuel is there. We can start to ramp up fuel production. And so now we’ve completed that due diligence. We’re going to go back to our investors to look to close out financing that makes this plant a reality. It is our strong commitment and I agree with this from Kelvin that we break ground before the end of the year.
00:06:04:06 – 00:06:12:06
Chris Steyn: That is good news. Dr. Kemm, what contribution will this project make to South Africa’s dire energy needs?
00:06:12:07 – 00:06:34:18
Dr Kelvin Kemm: Well, it’s absolutely critical. We believe we’ve got the right answer. The exercise based in Pretoria is entirely private. Obviously, we’re working as closely as we can with the government people such as the national nuclear regulator and all of those involved. But our group was pushed on to achieve what we’ve achieved, and the link up now with Koya is critical.
00:06:34:18 – 00:06:55:18
Dr Kelvin Kemm: This has been going on something like nine months. As Steve had indicated, and a number of agreements have been worked through and arrived at. And so we would be most happy to see him back in South Africa for his second visit and his second visit ever to Africa, by the way. And so we got on very well together, which is really important what has happened so far.
00:06:55:20 – 00:07:00:08
Dr Kelvin Kemm: We’re really thrilled that Koya people have got involved, with us.
00:07:00:10 – 00:07:09:05
Chris Steyn: Mr. La Fleur What far-reaching impact do you believe this project will have, not just for South Africa, but for Africa?
00:07:09:07 – 00:07:38:20
Warren La Fleur: Yeah, and that’s the exciting. That’s right. Because I think that the design that the Stratek folks and as Stephen mentioned, this investment has actually brought to life is very unique in that it is a low water-consuming nuclear reactor. So these are generation four reactors. It’s a passive design. So safety is of great importance.
00:07:38:22 – 00:08:12:07
Warren La Fleur: It has the ability to be deployed as close to the demand as possible. So, you know, if you can think of an industrial park or a desalination facility, you know, it has the ability to be deployed in close proximity to those kinds of heavy loads, and which means that it does not require a traditional design of, you know, generator or generation transmission and then subsequent distribution.
00:08:12:07 – 00:08:46:00
Warren La Fleur: Right. So and then subsequent loading. So it offers, particularly from an African, from a global perspective, the opportunity for, you know, large industrial users, governments, artists to also reimagine what a power system could look like, obviously impacting significantly the cost of delivering baseload energy. And importantly as well, you know, bringing, you know, low carbon solutions into the market.
00:08:46:01 – 00:09:23:15
Warren La Fleur: We know that lots of parts of Africa are struggling with this energy transition. But with climate change, you know, as we say, you know, significantly impacting the weather and water would actually become even more energy, more, more, more, you know, or water scarcity would actually become even more much more of an issue across the continent. And so bringing these new designs into the market could not only help Africa but also help our countries across the world to manage through these this important global challenge.
00:09:23:17 – 00:09:36:21
Chris Steyn: Dr. Kemm, Apart from South Africa, what market would there be for the nuclear energy produced at this plant?
00:09:36:23 – 00:10:01:07
Dr Kelvin Kemm: Well, the market is vast worldwide. We’ve seen with South Africa, we’ve been approached, for example, by the premier, the purple province, asking if they can get eight reactors from them. And we’ve been discussing that over the years and a lot of documentation that’s going in. We’ve also had approaches from agricultural communities into agricultural systems and should be most interested in that.
00:10:01:07 – 00:10:29:19
Dr Kelvin Kemm: As far as other countries are concerned, there’s been a lot of interest from African countries. They very much have realized that they need to go nuclear because they don’t own and all the other things that once they had an interest from countries like Australia and Indonesia and the Middle East. I was about people who were in the Middle East just a few weeks ago and you reported that having dinner with the prince, the prince said we really like South African engineers.
00:10:29:21 – 00:10:45:07
Dr Kelvin Kemm: They do what they say they’re going to do and they shouldn’t do the job. And what’s more, they treat us with respect and the strings. We really like dealing with them. And so, you know, we’re getting those sorts of endorsements. The market has lost.
00:10:45:09 – 00:11:02:06
Chris Steyn: Now, over the past nine months, you have all probably spent intense moments together. Are there any anecdotes you would like to share with us, any comments you would like to make amongst yourselves in conversation?
00:11:02:08 – 00:11:25:07
Dr Kelvin Kemm: Well, we found that a fun path. They certainly have cracked the whip often enough over us to get us to do things that we are very happy that they have done so. And it’s been a fun boss coming along and fun to get Stephen to come here. At one stage on one of our zooms, I said to him, like I say to so many, you really should come to South Africa and see.
00:11:25:09 – 00:11:44:13
Dr Kelvin Kemm: And he said, yes, yes, I’ll come. I thought he probably never will. Most people never do. And lo and behold, a few days later we got. Meanwhile, I’ll be there in about ten days. And he turned up And Warren and I and my team met him at eight o’clock in Sandton in the morning. And he was saying, wow, I don’t believe it. This country looks great.
Read more: Kelvin Kemm: DA’s Mileham spewed political propaganda – nuclear power is cheaper, safer, faster
00:11:44:13 – 00:12:01:14
Dr Kelvin Kemm: Everything looks good. And I thought, fantastic. We can make a good impression on this fellow. And since then, we’ve become firm friends. He spent the weekend looking at animals. I was just hearing a few moments here, he’s never seen an elephant or hippo before. And over the weekend, saw a lot of real ones. So we’re thrilled that he’s going back home with a number of South African experiences
00:12:01:20 – 00:12:14:18
Dr Kelvin Kemm: that will really cement him, cement in his minds. And we’ve arrived at a very good relationship between Stephen and Warren over this time.
00:12:14:20 – 00:12:24:17
Stephen Edkins: I was just going to add in the last week I became addicted to biltong.
00:12:24:19 – 00:12:25:02
Warren La Fleur: And.
00:12:25:04 – 00:12:25:14
Stephen Edkins: So I don’t.
00:12:25:14 – 00:12:26:17
Chris Steyn: Blame you.
00:12:26:18 – 00:12:27:21
Warren La Fleur: Yeah.
00:12:27:23 – 00:12:40:01
Stephen Edkins: And in particular, I like the chili. The like the chili one, the really moist chili biltong. I don’t think you can get it anywhere else. So I’m going to have to wait until I come back again before I can have it.
00:12:40:03 – 00:12:47:14
Chris Steyn: Any other observations you’d like to share? Because from our earlier conversation, I can tell that you are raring to come back to South Africa.
00:12:47:20 – 00:13:25:04
Stephen Edkins: Yeah. I mean, I think I think more more sort of professionally. Yeah, I, I was really, really intrigued to go to the Pelindaba facility that took quite a lot of organization. It’s, it’s for obvious reasons, quite a secure facility and yeah that really Yeah. When we drove in Yeah we, we saw one set of it was some water there, some cooling towers, some big chimneys and then later on sort of five kilometers later there was some was like wow, this is really, you know, this is a big facility.
00:13:25:04 – 00:13:41:02
Stephen Edkins: And I think, you know, Kevin, I’ll tell you, but it’s it’s several, several kilometers squared, that facility. So, I mean, that is a unique, you know, a unique facility, which I you know, I don’t see anybody in the small nuclear space has in the world.
Chris Steyn: Well, that is good to know. You can be proud, Kelvin.
00:13:45:18 – 00:14:06:03
Dr Kelvin Kemm: Absolutely. You know, sitting here in South Africa, it’s often difficult to convince people around the world that we don’t live in mud huts in the bush. So it’s really something that the country needs to spread around. I was recently in Washington, DC, but there again, saying to people, we actually know what we’re doing.
00:14:06:03 – 00:14:28:04
Dr Kelvin Kemm: We can achieve all of this and you can see them looking and somewhat single-mindedly, one only comes from ethnic color and sort of able to show them something that people believe. And once you realize that we really are world leaders and achieve like this, that our people go around the world to various conferences and so on and while they discover that we actually know what we’re doing well and truly and we didn’t receive any shields.
00:14:28:06 – 00:14:35:08
Dr Kelvin Kemm: And so it’s been great and would certainly really terrific to have the Koya people involved. I’m really thrilled at what’s happened.
00:14:35:10 – 00:14:38:17
Chris Steyn: Almost a reward for a life’s work for you, isn’t it?
00:14:38:18 – 00:14:59:17
Dr Kelvin Kemm: It absolutely is. I know there’s such a huge amount of money, the 9 billion rand which will be spread over five years. People like Stephen are used to this over the last nine months. Every time we try to contact him, he’s in a different country somewhere, amidst all the floods, got all over the place. The type of experience and doing all of this.
00:14:59:18 – 00:15:10:18
Dr Kelvin Kemm: As far as they’re concerned, this is part of the course. So, it’s been really thrilling to get to know the fellows, and we have great expectations of what’s going to happen over the next few months.
00:15:10:20 – 00:15:13:06
Chris Steyn: Warren, any last words from you?
00:15:13:08 – 00:15:37:08
Warren La Fleur: That, you know, I sort of had the opportunity to visit the deeply innovative systems over the last four weeks. I spent some time at the Fusion lab at Princeton University about four or five weeks ago, and that, of course, just people were saying we visited the Pelindaba facility.
00:15:37:08 – 00:16:08:00
Warren La Fleur: So looking at boat fish and as well as viewers. And I think that one of the more common themes across those two visits is how important it is for companies, people like Kelvin, to really start to think about the role of innovation and the potential innovation can actually have and have a long term impact on competitive differentiation countries.
00:16:08:02 – 00:16:36:11
Warren La Fleur: And so, you know, the fantastic thing about living at the cutting edge of things means that, yes, you solve these big problems, but the extension of knowledge creates a huge array of additional things that you actually get. So the unintended benefits of this project would not only be in terms of addressing the electricity demands in South Africa, but there might be a huge array of additional things that we’ll learn as you do.
00:16:36:12 – 00:17:01:15
Warren La Fleur: And so, to me, that is what’s exciting. It’s not only the things that are going to solve those other things which are peripheral that might actually become I’ll just be sort of take on this fantastic body of work. So we’re super excited about the partnership. Kelvin and the state and we look forward to really doing some great science and of course bringing that as much of the innovation to the market as possible.
00:17:01:15 – 00:17:17:00
Chris Steyn: Thank you. Those were the partners who had signed a 9 billion rand deal for an innovative nuclear reactor for South Africa. Thank you very much for speaking to Biznews. I’m Chris Steyn.
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