Cancelled Russian N-Plant Cost Bulgaria BGN 1.3 B So Far

Business » ENERGY | June 10, 2013, Monday // 10:06| Views: | Comments: 2
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Bulgaria: Cancelled Russian N-Plant Cost Bulgaria BGN 1.3 B So Far A file picture dated 22 April 2004 of an unfinished building of the first 1000 megawatt unit stands at Bulgaria's second nuclear plant in the town of Belene some 250km from Sofia, Bulgaria. Photo by EPA/BGNES

State-run power utility NEK has spent nearly BGN 1.3 B on the site of Belene nuclear power plant since the start of the troubled and controversial project based on Russian technology, а former high-ranking official claims.

“The major part of the money forked out for Belene so far was spent on consultancy companies for the nuclear plant,” Temenuzhka Petkova, former Head of Bulgaria's Public Financial Inspection Agency (PFIA), told the morning broadcast of Nova TV channel on Monday.

Petkova claims she was dismissed just days after the new government came into office because of her adversary comments on Belene costs and checks that found serious breaches.

The figures emerged as Rosatom Corp., Russia's state-run nuclear company, filed documents for its claim against Bulgaria's National Electricity Co. for its work on the currently cancelled project.

The documents were filed with the International Court of Arbitration in Paris in accordance with the updated schedule of the arbitration hearing.

The final hearings in the case are scheduled for July 2014.

Atomstroyexport, a unit of Rosatom, claims EUR 872 M 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.

Two years later the previous Socialist-led government hired BNP Paribas SA to arrange a EUR 250 M loan, assess the financial risks and prepare tenders to select banks for funding the project at the Danube river town, whose price tag towered from EUR 4 B to EUR 10 B.

NEK's poor results, triggered by a fall in power consumption, however forced it to breach the conditions on the loan, making it callable.

BNP Paribas SA, France's largest bank by market value, who was hired by the previous Socialist government to help fund the construction of Belene, ditched the project in February 2010.

Two and a half months earlier the German utility RWE abandoned plans to participate in the construction of a 2000MW nuclear plant in the Bulgarian Danube town of Belene due to funding problems.

RWE's departure from Bulgaria's new Belene nuclear plant put extra pressure on the center-right government of Boyko Borisov to find new shareholders while it redefines the scope of investment it needs.

NEK initially held a 51% stake in the scheme and Borisov's government planned to cut its shares in the project to 20-30%, which will still allow the country to keep its blocking quota.

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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» To the forumComments (2)
Tania OZ - 13 Jun 2013 // 17:56:14

Hey Novinite, why don't you get YOUR facts right instead of deleting my posts. It only makes you look silly. Grow up.

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