HSBC to advise Bulgaria on Belene nuclear plant

13th April 2011, Comments 0 comments

British-based global banking giant HSBC is to advise Bulgaria on the economic feasibility of its planned Belene nuclear power plant project, Prime Minister Boyko Borisov said Wednesday.

"We signed a contract with HSBC today. We hope they will provide us with the most urgent answers (regarding the feasibility of the plant) by June 1," Borisov said.

Earlier this week, Energy Minister Traicho Traikov said HSBC would be paid a fixed fee of 2.0 million euros ($2.9 million) plus an additional 0.95-percent commission on any external funding it could drum up for the plant.

Bulgaria picked the bank last November to review the 2,000-megawatt project, which has suffered long delays, and advise whether it should go ahead or be shelved completely.

Bulgaria contracted Russia's Atomstroyexport in 2008 to build two new 1,000-megawatt reactors at Belene to make up for the closure of four out of a total six reactors at another nuclear facility in Kozloduy.

The Belene reactors were initially planned to come on line in 2014.

But the withdrawal in 2009 of German utility RWE, which held a 49-percent stake in the project, as well as uncertainties about the plant's total cost and funding have delayed the signing of a final contract.

Moscow and Sofia differed on the estimated cost, with Russia saying it could not build the plant for less than 6.3 billion euros, even though the initial amount was put at 3.9 billion euros.

Bulgaria, on the other hand, refused to pay anything over 5.0 billion euros.

Last week, Atomstroyexport and Bulgaria's National Electricity Company agreed on a halt of all work on Belene for three months in order to resolve outstanding cost and safety issues.

By June 1, HSBC would have time to review the project, calculate the share capital of the project company, provide advice on possible credit lines and help draft the final agreements, minister Traikov said.

It will also be tasked with finding a new partner to possibly replace RWE, he added.

© 2011 AFP

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