Borisov: Sure We're Gonna Build Belene Nuclear Plant!

Energy | March 20, 2011, Sunday // 18:47|  views

Bulgarian PM Borisov pictured during a parliamentary hearing. Photo by BGNES

In the latest swirl of statements in his typical style, Prime Minister Boyko Borisov has declared that the government will certainly build the second Bulgarian nuclear power plant in Belene.

"Of course, we are going to build Belene, why wouldn't we!" Borisov told the bTV channel Sunday night even though he has stated numerous times that the troubled project for the Belene nuke is not a sure thing.

The past week has indicated that the Bulgarian government and the state National Electric Company NEK on the one hand and the Russian state nuclear corporation Rosatom and its subsidiary Atomstroyexport on the other keep failing to agree on a final price for the construction of the NPP.

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.

The apparent stalemate has led Bulgaria's Economy and Energy Minister Traicho Traikov to suggest that the Rosatom equipment already produced for Belene should be installed to build a seventh reactor in Bulgaria's operational NPP in Kozloduy, and that another solution should be found for Belene.

This has led to speculations that other foreign actors such as Chinese companies and the Chinese government might be hoping to snatch the Belene project from the Russians.

"We got two conditions – a state stake of 51%, and not paying any state budget money," Bulgaria's Prime Minister Boyko Borisov said on Sunday with respect to the Belene NPP. This differs from his earlier statements where the most often (though not always) recurring motif has been that the nuke will be built only if a "strategic European investor" is found.

When asked if Bulgaria already has a "strategic European investor", Borisov said there were two – a French and a Finnish company referring to non-binding agreements signed in November 2010 with French firm Altran Technologies and Finnish company Fortum.

Borisov also criticized his Economy Minister Traicho Traikov for making several "unfounded statements" over the past week, including that Bulgaria's government will delay its decision whether to go ahead with its second nuclear power plant project or not by at least another three months over concerns about safety and costs.

In February 2011, Bulgarian PM Borisov held talks with the French holding Areva over Belene.

The Areva Holding together with Siemens is actually already involved in the construction of Belene as a subcontractor to Russian state company Atomstroyexport.

In November 2010, shortly after a visit to Sofia by Russian PM Putin, Bulgaria's National Electric Company NEK and Russian state company Rosatom signed a memorandum providing for a final fixed price for the two reactors of EUR 6.298 B.

This sum is still not final since the document is not binding; a final binding agreement for the establishing of a joint company for Belene was expected to emerge in 4-5 months, according to Rosatom head Sergey Kirienko, who was in Sofia to sign the document.

The other non-binding documents on Belene signed at the same time provided for participation in the project of Finnish company Fortum with a share of 1%, and of French company Altran Technologies with a share of 1%-25%. NEK is to keep a majority share of 51%, while Rosatom is also expected to have a share of 25%.

Serbia has expressed interest in acquiring a share of 5%-10% but the talks for that have not been finalized yet. It is unclear what share Areva might go for if it ultimately decides to seek participation in Belene.

After it was first started in the 1980s, the construction of Bulgaria's second nuclear power plant at Belene on the Danube was stopped in the early 1990s over lack of money and environmental protests.

After selecting the Russian company Atomstroyexport, a subsidiary of Rosatom, to build a two 1000-MW reactors at Belene and signing a deal for the construction, allegedly for the price of EUR 3.997 B, with the Russians during Putin's visit to Sofia in January 2008, in September 2008, former Prime Minister Stanishev gave a formal restart of the building of Belene. At the end of 2008, German energy giant RWE was selected as a strategic foreign investor for the plant.

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.

During his visit to Sofia in November, Sergey Kiriyenko, CEO of Russian state nuclear energy company Rosatom admitted that Bulgaria and Russia had made a mistake by not specifying the exact raise of cost for the construction of the Belene nuclear power plant.

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Tags: Altran Technologies, NPP, altran, Fortum, National Electric Company, Nuclear Power Plant, Belene, Atomstroyexport, Rosatom, Anne Lauvergeon, Areva, Siemens, Boyko Borisov, Prime Minister, Traicho Traikov, Economy Minister, Atomstroyexport, Rosatom, NPP, Nuclear Power Plant, Belene NPP, Belene


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