Price is 'set' for Belene

20 October 2010

Bulgaria has put a maximum price tag of €7 billion ($9.7 billion) on the Belene nuclear power plant while extending for a second time its contract with AtomStroyExport by six months.


Prime minister Boyko Borisov made the offer after late September talks with Sergei Kiriyenko, Atomstroyexport's holding company Rosatom.


Borisov expects no readjustment of Rosatom's €4 billion ($5.5 billion) investment offer from last year, allowing him to let other potential investors make realistic offers for the remainder of the foreign investment share needed for the construction of Belene's two 1000 MWe VVER to go ahead. The National Electricity Company (NEK) will take a stake of 20-30%.
Once Borisov gets an answer from Russia he can invite long-waited strategic European investors to join the project and replace RWE, which left in 2008.


Borisov's overall aim is to reduce the €7 billion price tag of the project, including inflation, by about €700-800 million. However, Bulgarian finance minister Simeon Dyankov has so far maintained that inflation might push Belene's cost to €8-9 billion by 2020.
The next immediate steps for the Bulgarian government would be to agree on which inflation index to use for financial models, while awaiting Rosatom's answer.


Meanwhile, extra pressure has mounted on the Bulgarian government after Standard & Poor's rating agency downgraded NEK's long-term corporate credit rating from 'BB' to 'BB-' and its stand-alone credit profile from 'BB' to 'BB-'. This is due to the liquidity difficulties, which NEK has experienced over the last year and which has made unclear if the company is capable of investing in Belene or not.


Borisov's current offer to Rosatom through is based on Bulgaria's solid long-term strategy for nuclear power, as the country will also need Russian technical input to upgrade Kozluduy 5 and 6 by 2017 and 2019 respectively, subject to Nuclear Regulatory Agency’s approval.
By Rumyana Vakarelska
for World Nuclear News