Shortlist of investors in Belene down to two

Wednesday, 12 March 2008

Bulgaria's National Electric Company (NEK) has short-listed Germany's RWE and Belgium's Electrabel as strategic investors in the planned Belene nuclear power plant. NEK is seeking investors for a stake of up to 49% in the Belene Power Co, which will own and operate the plant.

The planned Belene plant (Image: NEK)

In a statement, NEK said its board had "approved Electrabel and RWE Power as the candidates having submitted the most favourable terms and conditions." The two companies will be invited to continue talks.

Belgium's Electrabel, CEZ of the Czech Republic, EOn and RWE of Germany, and Italy's Enel had submitted indicative bids in October 2007 to acquire a 49% stake in the Belene project. At the request of NEK, the five companies submitted improved offers in January. Bulgaria's economy minister has set mid-2008 as the deadline to select the strategic partner. NEK will hold a 51% stake in Belene Power.

In October 2006, NEK selected Russia's AtomStroyExport (ASE) a €4 billion ($6 billion) to design, construct and commission two AES-92 model VVER units with V466 pressurised water reactors. That contract was signed in January 2008 during a visit by Russian president Vladimir Putin to Sofia. ASE will be the main contractor, using France's Areva and Germany's Siemens as primary subcontractors.

Construction of the two new units at Belene, on the Danube River, is scheduled to begin in the second half of 2008, with the reactors set to enter operation in 2014 and 2015.

Construction began on four reactors at Belene under plans drawn up by Bulgaria's communist government and the Soviet Union. Work on site began in 1987 but ceased in 1991. Some options tabled by ASE would reuse existing equipment and buildings from the earlier project.

The decision to build new nuclear power plants comes after Bulgaria agreed to shut down reactors at its Kozloduy plant in order to join the European Union in 2007. The units are not considered safe enough by the bloc and units 3 and 4 at that plant closed on 31 December 2006, following units 1 and 2 which closed at the end of 2002. The cost of the early shutdowns has been estimated at €3 billion ($4.4 billion), partly due to the lack of a surplus of electricity for export to countries such as Greece, Turkey, Serbia and Macedonia.