Bulgaria's Kostov: Agony over Belene N-Plant Continues

Ivan Kostov, leader of the rightist opposition Democrats for Strong Bulgaria and former prime minister, is pictured here in parliament. Photo by Sofia Photo Agency

Bulgaria's agony over plans for a second nuclear power plant continues unabated, a rightist leader said on Monday as the final decision on the project was delayed yet again.

Uncertainty over the fate of Belene nuclear power plant project only intensified on Monday after a keenly-awaited phone conversation between the prime ministers of Bulgaria and Russia.

According to media reports Prime Minister Boyko Borisov told Vladimir Putin that Bulgaria will abandon plans to build a 2,000 megawatt nuclear power plant on the Danube River if it cannot attract sufficient Western funding for the EUR 8 B project.

The government in Sofia has to decide by the end of the month whether to go ahead with the project or not.

"This deadline was set by Vladimir Putin during his pre-election campaign in a bid to promote his macho image. This is the only reason why his administration is pursuing so doggedly this deadline," Ivan Kostov, leader of the rightist opposition Democrats for Strong Bulgaria and former prime minister, commented on Monday.

"Putin knows the project has slim chances to get implemented. I guess he will give up his macho image and opt for prolonging Bulgaria's agony by another 3-4 months."

He said he uses the word "agony" because the project has failed to attract serious foreign investors in the past three years.

"The truth is nobody wants to invest in a Russian project. If Moscow grants Sofia a loan at an interest rate of 10-12% to be repaid over twenty years, the project will come at a tag of BGN 27 B," Kostov said.

In October 2011, Bulgaria and Russia reached an agreement to extend the negotiations over Belene nuclear project by another six months as of the beginning of October amidst continuing haggling over its price and feasibility.

Last week  Bulgarian Prime Minister Boyko Borisov declared that the future second Bulgarian nuclear power plant at Belene will not be solely a project of Bulgaria and Russia if it takes place at all. He stressed that his Cabinet will keep working in the upcoming weeks in order to "diversify" the future participants in the Belene NPP project.

Rosatom's subsidiary Atomstroyexport has already assembled the reactor for the first block of the NPP to be built in the Bulgarian Danube town of Belene.

Borisov has also hinted that the Belene reactor could be placed in Bulgaria's sole existing Kozloduy NPP.

Moscow has repeatedly warned that Bulgaria will be sued and obliged to pay EUR 1 B in damages if the project collapses.

Experts however have commented that the prospect of paying hefty compensation to the Russian contractor is not that scary.

According to them Russia, for whom this project is very important from a political rather than an economic point of view, is very likely to agree to more delays.

Besides the very constitution of the arbitral tribunal takes a few months. In some cases this process can be quite long, especially when the arbitration procedure has not been explicitly stipulated in the contracts.

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