Related readings:  Areva may get nuclear contract  Areva deals with China on 2 nuclear reactors  Areva T&D to double capacity

The two sides are working on a final accord to build the reactors at Yangjiang in Guangdong Province, Qian Jihui, a senior adviser at China National Nuclear Corp, the nation's top nuclear reactor builder, said in Beijing. The contract was originally awarded to Toshiba Corp's Westinghouse Electric Co, which will get an agreement for two other reactors in Shandong.

China needs to add two reactors a year to meet a 2020 target of getting four percent of its power from nuclear energy from about 2.3 percent now. Areva and Westinghouse are competing to build as many as 26 more reactors by 2020 as China turns to atomic energy to cut pollution and reliance on oil.

"Awarding the contracts to two companies will give China more room in later negotiations," said Yan Shi, a Shanghai-based analyst with Core Pacific Yamaichi International Ltd.

Westinghouse originally won a US$5.3 billion agreement on December 16 to build reactors at Yangjiang and Sanmen, after outbidding Areva and Russia's AtomStroyExport following almost two years of negotiation and lobbying. France's President Jacques Chirac promoted Areva's bid when he met his Chinese counterpart, Hu Jintao, during a visit to Beijing in October.

The parties will sign a final agreement "very soon," Qian told reporters, without giving specific reasons for the decision to award the contract to build the reactors in Guangdong Province to Areva instead of Westinghouse.

China plans to import uranium from Australia, Canada, South Africa and Kazakhstan to fuel its expanding nuclear power capacity, Qian said. China has nine reactors operating in Zhejiang and Guangdong provinces. Six are under construction in Jiangsu in the east and in Guangdong. These projects have a combined capacity of about 12,000 megawatts. China plans to use Russian technology for two reactors at the Tianwan Nuclear Plant in Jiangsu, Qian said. "China and Russia have a close relationship," he said. "Awarding nuclear reactors could be a deal boosted by political ties."

Paris-based Areva may build the Yangjiang reactors, among four originally earmarked for Westinghouse, which will instead get a contract for two reactors at Haiyang in Shandong Province, according to Bloomberg News.

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