German utility RWE has officially notified the state Bulgarian Energy Holding (BEH) about its decision to quit the construction project for  nuclear power plant at the Bulgarian town of Belene on the Danube, it was announced on October 28 2009.

The announcement was made by BEH executive director Galina Tosheva at a news conference, news agencies said.

The reasons for RWE to abandon the project were the economic and financial downturn and because the project had failed to achieve two of its primary goals: signing a contract with the company building it and agreeing on a financial framework.

Speculation about the withdrawal of RWE, which was picked to buy 49 per cent in the future project company, has been going on for the past few months. RWE, which has agreed to pay more than 1.2 billion euro, rising to as high as two billion euro, for its stake, has also been reported to be interested in selling part of its stake to other investors.

On September 28 2009, Bulgarian Prime Minister Boiko Borissov met RWE chief executive Juergen Grossman to discuss the project and was assured by Grossman that RWE was not pulling out and that it was still interested in Belene.

"The German side wants to continue. When we are ready, we will give our verdict on the fate of the project by the end of October," Borissov said.

Bulgaria picked Russia's Atomstroyexport to build the twin 1000MW reactors in a tender that critics say was rigged in favour of Russian companies by choosing the VVER technology. The construction contract, worth four billion euro, was signed in January 2008, but total costs are estimated to reach 10 billion euro.