Feb. 22 (Bloomberg) -- Japan Atomic Power Co., a wholesale nuclear power generator owned by regional utilities, is in talks with banks to roll over 104 billion yen ($1.1 billion) loans due in April, two people familiar with the matter said.
The company is seeking guarantees for the loans from Kansai Electric Power Co., Chubu Electric Power Co., Tohoku Electric Power Co. and Hokuriku Electric Power Co., one of the people said, declining to be identified because the information is private. Agreements among the involved parties may be reached by mid-March, the person said.
All of Japan Atomic’s reactors are offline with no date set for restart after the Fukushima nuclear disaster in 2011. Kansai Electric has said it is spending hundreds of billions of yen to improve safety of atomic plants and meet requirements to be set by the Nuclear Regulation Authority in July.
Japan Atomic borrowed 104 billion yen from banks last April, most of which was planned for safety improvements at its Tsuruga and Tokai Dai-Ni nuclear plants, spokesman Mitsuru Marutani said by phone today. Options under consideration include a rollover of the loans, he said, declining to elaborate.
The facility comprises 29 billion yen from the state-run Development Bank of Japan and 75 billion yen from 11 lenders including Mizuho Corporate Bank Ltd. in April last year, according to the company’s statement to Japan’s finance ministry. The loans, both due on April 26, were guaranteed by Kansai Electric, Chubu Electric, Tohoku Electric and Hokuriku Electric, the filing shows.
Spokesmen of the four power companies said they weren’t able to immediately comment on the matter when contacted by phone today.
Kansai Electric, the Japanese utility most reliant on nuclear power, may have to spend at least 285 billion yen to improve safety of its nuclear stations, President Makoto Yagi said last month. Japan’s ten nuclear operators are facing a combined safety cost of about 1 trillion yen to meet the regulator’s rules, the Nikkei newspaper reported earlier this month.
The Asahi newspaper reported earlier today that Japan Atomic plans to seek the rollover and the loan guarantees. The report said Japan’s nine power utilities will buy part of Japan Atomic’s stake in Japan Nuclear Fuel Ltd. for as much as 30 billion yen to help the company’s finances.