Chinese Firms Eager to Snatch Bulgaria's Belene NPP from Russia - ExpertEnergy | March 20, 2011, Sunday // 17:18| views
Bulgarian PM Borisov with Chinese PM Wen in New York in Sept 2010 when the two discussed possible Chinese investments in the Belene NPP. Photo by EPA/BGNES
Chinese companies are likely to realize Bulgaria's project for a second nuclear power plant in Belene as the talks between the Bulgarian government and Russia have stalled, an expert has indicated.
According to Veselin Iliev, international economic cooperation director at the Bulgarian Industrial Association, Chinese companies are potential candidates to build the Belene nuclear power plant.
"As Russia is trying to get a higher price for the construction of Belene, it turns out that Chinese companies can overtake it. The project for the second Bulgarian NPP corresponds to the thinking of the Chinese in terms of methods and scopes," Iliev believes as quoted by BTA.
He further leaked information that Chinese representatives have been on a visit to the Bulgarian National Electric Company NEK, which is in charge of the Belene project.
Iliev, presented as an expert who has been working on the Chinese market for many years, says that the Chinese prefer dealing with state institutions and projects supported by state authorities.
Under the present arrangements, the 2000-MW Belene NPP is supposed to be built by Rosatom's subsidiary Atomstroyexport. However, Bulgaria and Russia continue to haggle over the price with Russia asking for EUR 6.3 B and Bulgaria willing to pay as little as EUR 5 B.
Recently, Bulgaria's Economy and Energy Minister Traicho Traikov announced that Bulgaria could use the equipment already ordered for its intended second nuclear power plant in Belene in order to build a new, seventh reactor in its only operational NPP in Kozloduy.
In his words, thus the Kozloduy NPP will become "fully Russian" – i.e. with Russian technology, while Bulgaria can then "seek another solution" for the Belene NPP.
Should it be realized, however, his idea may pave the way for attracting other potential foreign investors to Belene. An example in hand could be a potential interest on part of China.
In talks with Bulgarian Prime Minister Boyko Borisov in New York City in September 2010, Chinese Prime Minister Wen Jiabao declared that China wanted to invest in Bulgaria's second nuclear power plant in Belene but only if the plant were to use a Chinese nuclear technology.
Back then the Bulgarian government reacted by thanking for the offer but saying that its predecessors had already signed a deal with the Russians.
The Belene NPP was de facto frozen in the fall of 2009 when the previously selected strategic investor, the German company RWE, which was supposed to provide EUR 2 B in exchange for a 49% stake, pulled out.
Subsequently, in the last months of the Stanishev government in early 2009, Putin offered Bulgaria a Russian state loan of EUR 4 B, which ex PM Stanishev refused.
In late 2009, after the Borisov government took over, Rosatom offered Bulgaria a loan of EUR 2 B so that the construction can continue, in exchange for a stake in the future plant that the Bulgarian government could then buy out by returning the money. The offer was refused by the Borisov Cabinet which also made it clear it would construct the Belene plant only if an European (apparently meaning EU or Western European) strategic investor can be found.
Under Bulgaria's preliminary contract with Atomstroyexport signed in 2008, the construction of the Belene plant with two 1000-MW VVER nuclear reactors is supposed to cost EUR 3.997 B.
As the contract expired on September 30, 2010, Bulgaria and Russia decided to extend it by 6 months until they reach a final agreement on how much the construction of the Belene NPP will cost.
In mid November, the Bulgarian Energy Holding, NEK's parent company, picked HSBC, one of UK's biggest banks, for a consultant to help it decide how to proceed and attract new investors for the planned Belene nuclear power plant.
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