Tender for new Lithuanian plant investor stalls

06 December 2010

The tender to select a strategic investor in the new Visaginas nuclear power plant has failed. The Lithuanian Ministry of Energy announced that the only proposal meeting the tender requirements – from South Korea – had been withdrawn. 


Lithuania is proposing to construct the Visaginas plant alongside the shut down Ignalina plant that formerly supplied about 70% of the country's power. With one or two large reactors and cooling from either a lake, cooling towers or a mixture of both, it could provide up to 3600 MWe. The project company for the development is Visaginas Atomic Energy (VAE).


In December 2009 a call was put out for "an experienced investor or investors, which have a long experience in developing new electricity generation capacities and operating nuclear power plants." Five companies met the prequalification requirements. The requests to submit binding proposals were issued on 10 September 2010.


The Ministry of Energy said that it had received proposals by the 10 November deadline. Without revealing the bidders, it said that a strategic investor would be selected by the end of 2010 with exclusive negotiations completed in 2011. Lithuanian interests are expected to retain 34% of Visaginas, with a potential majority stake for a major investor.


However, the ministry has now reported that it had received two proposals. One of these – from an undisclosed bidder – did not meet the tender requirements, it said. The other, from South Korea's Korea Electric Power Corporation (Kepco), was "an attractive binding proposal to co-invest in the project and to construct a nuclear power plant in the period to 2020 for an attractive fixed price."


It added that the regional partners in the project (Latvia and Estonia) "were informed about Kepco's proposal and on the basis of the proposal declared their intention to invest in the project, which together with Kepco’s and Lithuania's equity investment ensures full project funding."


However, two weeks after submitting its proposal, and having been asked to clarify and discuss its proposal with the tender commission, Kepco "unexpectedly" informed the commission that it was withdrawing its offer.


The ministry said that negotiations with potential investors will continue. It stated, "Appreciating VAE project development progress and in consultations with regional partners and the European Commission, the process of granting concession by way of direct negotiations without tender, but following the same conditions, will be commenced."


The regional partners have reaffirmed their joint support for the construction of the nuclear power plant in Lithuania to contribute to a stable and secure electricity supply in the Baltic Region.


Researched and written 

by World Nuclear News