Bulgarian PM: Belene Nuclear Project - Getting Married with No Sex

Business » ENERGY | January 3, 2012, Tuesday // 12:49| Views: | Comments: 0
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Bulgaria: Bulgarian PM: Belene Nuclear Project - Getting Married with No Sex A file picture dated September, 2008, showing workers during the construction of the first 1 000 MW unit of the second nuclear plant of Belene, Bulgaria. Photo by EPA/BGNES

The fate of the project for a second Bulgarian nuclear power plant in the Danube town of Belene remains largely unclear, according to the latest statement of Bulgarian Prime Minister Boyko Borisov on the issue.

Bulgaria has been haggling with Russia's state corporation Rosatom and its subsidiary Atomstroyexport for the price of the 2000 MW Belene NPP – and for other issues – for years.

Borisov's latest interview made New Year's Eve, and released by the Bulgarian National TV on Tuesday, January 3, 2012, indicates that the talks with Russia have gone nowhere after in the fall of 2011, the two parties agreed to extend the deadline for striking a final deal on the project until the spring of 2012.

In his BNT interview, Borisov explicitly stressed the fact that it is unclear whether and how much Bulgaria will benefit from the new NPP when it is built – especially with respect to the production cost of electricity.

"Such a large and expensive project cannot be signed on your knee in a piano bar, it needs to be fine-tuned all over. The signing of such a contract is like getting married today, and sleeping with your wife only next year. Neither the price of the Belene NPP construction, nor the price of the electricity that it will produce is clear," Borisov stated.

Bulgaria's National Electric Company NEK and Russia's Atomstroyexport, a subsidiary of Rosatom, signed on September 30 a new annex extending by the end of March 2012 their contract for the construction of two 1,000 megawatt nuclear reactors at Belene, a statement of the Bulgarian state utility said.

The new, fourteenth, annex between the two sides will allow them to take into account the results from the stress tests and the expected developments on the electricity market.

In the middle of July Russia's state nuclear company Atomstroyexport took Bulgaria's NEK to an arbitration court for EUR 58 M over delayed payments for its work on two nuclear reactors.

The next day the Bulgarian company said it is ready to strike back with a EUR 61 M counter claim against Atomstroyexport over delayed payments for purchases of old equipment for the plant, worth about EUR 300 M.

Bulgaria and Russia are unable to agree on the major bone of contention - the price for the construction of the 2000-MW Belene NPP.

Russia says the project construction price should be EUR 6.3 B. The Borisov government wants to set the price at as little as EUR 5 B.

After it was first started in the 1980s, the construction of Bulgaria's second nuclear power plant at Belene on the Danube was stopped in the early 1990s over lack of money and environmental protests.

After selecting the Russian company Atomstroyexport, a subsidiary of Rosatom, to build a two 1000-MW reactors at Belene and signing a deal for the construction, allegedly for the price of EUR 3.997 B, with the Russians during Putin's visit to Sofia in January 2008, in September 2008, former Prime Minister Stanishev gave a formal restart of the building of Belene. At the end of 2008, German energy giant RWE was selected as a strategic foreign investor for the plant.

The Belene NPP was de facto frozen in the fall of 2009 when the previously selected strategic investor, the German company RWE, which was supposed to provide EUR 2 B in exchange for a 49% stake, pulled out.

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