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Saturday, December 20, 2008

German RWE signs nuclear plant deal

Germany's RWE AG signed a deal with Bulgaria's state-owned NEK power utility on Friday to become a strategic investor in the country's second nuclear plant.

At the signing ceremony, Prime Minister Sergei Stanishev hailed the project, saying that it would "guarantee Bulgaria's energy independence, electricity production and exports."

RWE outbid rival Belgian energy company Electrabel, owned by France's GDF Suez SA, for a 49-percent stake in Belene Power Company, which will own and operate the new nuclear power plant.

Gerd Jaeger, a senior official at RWE, said his company was in "active negotiations" with Electrabel to split the 49-percent stake in the nuclear plant.

The state-owned NEK power utility will hold the remaining 51 percent in the 2,000-megawatt plant. The plant's two reactors are expected to come into operation in 2013 and 2014, said NEK Chief Executive Lyubomir Velkov.

In January, Bulgaria signed a contract worth almost euro4 billion (US$5.6 billion) with Russia's Atomstroyexport to build a second nuclear plant at Belene, 250 kilometers (155 miles) northeast of Sofia.

Atomstroyexport will be the main contractor, using France's Areva and Germany's Siemens AG as primary subcontractors.

Bulgaria's government invested more than $1 billion in Belene, but froze the project in 1990 after environmentalists said it could pose a safety risk.

The project was revived to compensate for the closure of two units at its existing nuclear plant at Kozlodui. The closure was part of the requirements Bulgaria had to meet to join the European Union last year.

(Source: AP)

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