Sat, Feb 11 2012

Electrabel pulls out of Bulgarian nuclear power plant project

Thu, Feb 19 2009 14:50 CET

byAlex Bivol

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Electrabel pulls out of Bulgarian nuclear power plant project

Photo: Nadezhda Chipeva

Belgium's Electrabel, owned by French utility GDF Suez, pulled out of talks to take a minority stake in Bulgaria's planned Belene nuclear power station, choosing instead to focus on its own projects, Reuters said.

"We are establishing our strategic priorities among the different projects in the pipeline," Reuters quoted an unnamed company spokesperson as saying. The company was more interested in nuclear plants in France, Britain, Romania and Abu Dhabi, Reuters said.

Electrabel was one of the two finalists in the tender organised by Bulgaria's state-owned power grid operator NEK for 49 per cent in Belene. The power grid operator would keep the majority 51 per cent stake.

NEK picked Germany's RWE as the winner in the tender in 2008, which was followed by talks between the two finalists about a possible tie-up.

RWE does not plan to abandon Belene, despite earlier opposition in Germany that delayed board approval of the deal. The global cash squeeze will make raising funds needed for the plant, difficult, RWE has said, although it remains optimistic that bank financing could be found.

RWE agreed to pay 1.275 billion euro for the 49 per cent stake, which could rise to two billion euro by the time the power station is scheduled to be finished in 2014. The money will be used to start construction in 2009, while NEK is in charge of securing the bulk of the funding.

On top of the credit crunch, the spiralling costs of construction have made it even more difficult for BNP Paribas, picked by NEK to arrange the loans, to secure the funds.

Bulgaria's contract with Russian Atomstroyexport, whose technology will be used to build the two 1000MW reactors, set the construction costs at just under four billion euro, but analysts have warned that the final costs could rise to as high as seven billion euro.

Belene is meant to once again make Bulgaria the leading electricity exporter in the Balkans, a position it lost after it had to shut down four units at its Kozloduy nuclear power station before joining the European Union in 2007.

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