Bulgaria faces penalties amounting to way over USD 58 M over the cancellation of the Belene NPP project, Russian media warn.

Citing sources from Russia's state-owned nuclear corporation Rosatom, Moscow-based business daily Vedomosti reports that this is the cost of the already carried out preparatory works on the site near the northern Bulgarian town of Belene.

The newspaper reminds that Rosatom subsidiary Atomstroyexport, the Russian contractor selected to build the Belene NPP, filed a lawsuit for EUR 58 M against Bulgaria's National Electric Company (NEK) at the International Court of Arbitration in Paris in the summer of 2011.

Rosatom sources cited by Vedomosti say that the company has no intention of giving up on its claim.

The newspaper notes that the major problem of the Belene NPP project was its financing.

The Russian business daily cites a Wednesday statement of Bulgarian Prime Minister Boyko Borisov in which he says that the total cost of the plant, including the servicing of loans, would have amounted to some EUR 10 B.

Rosatom proposed a loan for the construction of the nuclear power plant but Bulgaria preferred to set up an investment pool and to retain a 51% stake, Vedomosti adds.

German RWE, which was expected to invest some EUR 2 B in the project, pulled out of the scheme in 2009.

Now Prime Minister Borisov is emphasizing that the country cannot afford to spend billions on the Belene NPP project, Vedomosti notes.

In a Wednesday interview for RIA Novosti, Russian expert Vladimir Grachov commented that the situation created the impression that the Bulgarian Prime Minister had misunderstood something about the nuclear power plant project.

He argued that the Russian side had suggested a scheme under which the Bulgarian state budget would not be required to participate in the funding.

"All operations would have been carried out by the project company and the debt would have been settled with the profits from the the sale of electricity generated at the plant, i.e. after the Belene NPP became operational," the expert suggested.

He refused to say whether there was a market in the region for the electricity that would have been generated by the Belene NPP.

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