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Bulgaria needs nuclear plant funding soon-adviser

  Funding for Bulgaria’s planned nuclear power plant at Belene must be secured soon, or the multi-billion euro project will be delayed, a consultant to the scheme said on Wednesday.

The Socialist-led government and German utility RWE have signed a deal to build Bulgaria’s second nuclear power plant by 2014-2015 as part of Sofia’s efforts to recover its position as a major power exporter in the Balkans.

State power utility NEK, which has 51% stake in Belene, has contracted Russia’s Atomstroiexport to build the two 1,000 megawatt reactors in a €4.0 billion ($5.28 billion) deal, but has yet to ensure the funding for the plant.

“The government should close a financial deal as soon as possible,” said Djurica Tankosic of WorleyParsons, an architect engineer with the Belene project. “We can be on track until the end of the year. After that, without funding, there will be a delay,” he told reporters.

NEK has picked French bank BNP Paribas to help it arrange the financing but a source familiar with the process said banks had not shown interest so far due to the global crisis and, in some cases, doubts about the project’s viability.

With private sector funding sources for very large projects drying up, Belene’s financing options lie with state-backed export credits, industry officials say.

On Tuesday, Russian Prime Minister Vladimir Putin reiterated that Moscow would consider granting a €3.8 billion ($5 billion) loan to Bulgaria for the plant. Details are yet to be negotiated, but Bulgarian officials say it would require state guarantees.

Bulgarian Prime Minister Sergei Stanishev has suggested that the loan should be linked with the signing an agreement with Russia for the South Stream gas pipeline, expected within weeks.

A source close to the project said that Siemens and Areva, both subcontractors of Atomstroiexport for Belene, could also provide export credits.

Bulgaria’s right wing opposition has urged a freeze of Belene, saying the financing would be too costly in times of tight liquidity and that it would increase dependence on Russia. (Reuters)