By Anna Mudeva
SOFIA, Feb 28 (Reuters) - Bulgaria is expected to decide by
the end of March which of the five bidders interested in
acquiring 49 percent of a planned nuclear power plant will stay
in the race, two sources said on Thursday.
The sources familiar with the bidding process for the Belene
plant told Reuters that Belgian utility Electrabel, owned by
France's Suez <LYOE.PA>, and Germany's RWE <RWEG.DE> were
leading the list of favourites for now.
The Balkan country has also received offers from Italy's
Enel <ENEI.MI>, Germany's E.ON <EONG.DE> and Czech company CEZ
<>.
"A decision on the short-list is now expected towards the
end of March," one source said. "(Bulgaria's state power
monopoly) NEK could not a reach a decision last week."
A NEK spokeswoman said there might be a development on the
project at the end of March but did not give other details.
Bulgaria wants the 2,000 megawatt plant in the Danube town
of Belene to make the country a major electricity exporter in
the Balkans again after it was forced to shut communist-era
reactors as a condition of joining the European Union.
Bulgaria, where nuclear energy accounts for some 33 percent
of power needs, is among the EU countries which believe nuclear
is part of the solution to climate change, as proponents say
atomic power emits almost no greenhouse gas emissions.
NEK, which will hold 51 percent of Belene, has contracted
Russia's Atomstroiexport, controlled by gas company Gazprom
<GAZP.MM>, along with France's Areva <CEPFi.PA> and Germany's
Siemens <SIEGn.DE> to build the plant.
The reactors are expected to come online in 2013-2014.
Sofia has extended its deadline for picking a strategic
investor for the plant until mid-2008, due to political
wrangling about how to run Belene, which coupled with funding
woes could push the start date well beyond the planned 2014.
Sources say Bulgaria has received little interest in a
tender to pick a lead manager to secure financing for Belene.
The government says the project would cost 4 billion euros ($6
billion) but some officials put it at over 6 billion euros as
capital costs keep increasing.
"Only two French banks expressed interest," said one source.
"Banks are hesitant. They want to see a partner who could safely
run the reactors at high capacity to ensure that the huge costs
could be covered".
When Bulgaria first decided to build Belene in 2005, the
bill was estimated at 2.5 billion euros.
Consultants Wood Mackenzie say capital costs for a new 1,000
MW reactor have risen to between $2.5 billion and $3.5 billion.
Analysts say increasing costs of construction, uranium and steel
have all added to the bigger bills.
One source said Sofia was not ruling out the option of
taking advantage of a Russian offer to provide money for Belene.
In January, visiting Russian President Vladimir Putin said
Moscow was ready to extend 3.8 billion euros of credit.
(Additional reporting by Tsvetelia Ilieva, editing by Anthony
Barker)
