Bulgaria Picks US Firm for Arbitration Battle with Russia over Belene
Energy | September 23, 2012, Sunday| 1410 views
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The Belene nuclear power plant has been de facto frozen since the fall of 2009 when the previously selected strategic investor, the German company RWE, pulled out. Photo by Sofia Photo Agency
White and Case, an international law firm based in New York, will represent Bulgaria as it is heading to arbitration over the cancelled Russian nuclear plant.
"The government started planning its legal defence six months ago. We picked White and Case as it is one of the best law firms in the world," Energy and Economy Minister Delyan Dobrev said at the end of the week.
The minister declined to disclose details from the strategy, devised by the consultancy, saying it is confidential, but stressed that the interests of the society will be protected.
The last time White and Case advised Bulgaria was in July in relation to its EUR 950 M, 4.25%, bond issue, according to the law firm site.
White and Case also represented Bulgaria in an ICSID arbitration brought against the country by Cyprus-based Plama Consortium Limited. In 2008 the arbitral tribunal reached a unanimous decision and dismissed all claims against Bulgaria.
Russia's Atomstroyexport has expressed firm belief it will pocket EUR 1 B in compensation over the cancellation of nuclear power plant Belene in Bulgaria.
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.
Three months later, on September 11, Rosatom Corp., Russia's state-run nuclear company, increased a claim against Bulgaria's National Electricity Co. from EUR 58 M to EUR 1 B.
Atomstroyexport, a unit of Rosatom, said it increased its claim filed with the International Court of Arbitration in Paris in 2011 to cover construction work and production costs of the two canceled nuclear reactors.
Atomstroyexport was contracted in 2005 to build the plant for an initial 4 billion euros, but the costs later rose.
After failing to agree on its cost and find Western investors however in March 2012 Bulgaria decided to abandon plans to build its second nuclear power plant.
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