Five companies shortlisted for Belene NPP

Five companies have been shortlisted for negotiations on the 2,000 MWe Belene Nuclear Power Plant project, Bulgarian Energy Minister Temenuzhka Petkova told Parliament’s Energy Committee on 19 December.

The shortlisted candidates are: China National Nuclear Corporation (CNNC), Korea Hydro & Nuclear Power (KHNP), Russia's Atomenergoprom, a subsidiary state nuclear corporation Rosatom, France's Framatome and US-based General Electric (GE), the energy ministry said in a statement. Invitations for submitting binding offers will be sent to the shortlisted candidates by the end of January 2020.

The ministry said it had selected those applicants "best suited to the experience of building and investing in nuclear facilities and that have adequate financial capacity to secure the investment and participation obligations of the Belene NPP construction project". CNNC, Rosatom and KHNP were selected as potential strategic investors in the project. Petkova said these candidates are "world leaders in the field of nuclear energy and are selected on the basis of their experience, financial stability and credit rating”.

Framatome and GE were put on the shortlist after they proposed supplying equipment for the project and arranging financing, the ministry said. GE has expressed interest in structuring project finance as well as participating as a designer and a supplier of equipment for turbine control room, compressors, transformers and other pieces of equipment. Framatome has stated its interest in taking part in the structuring of project finance for safety systems, including electrical ones as well as control systems.

The investors will be allowed to negotiate electricity purchases with companies seeking to acquire minority stakes in Belene. However, the state reserves the right to have a blocking minority in a future project company. “This means that, whatever the size of our participation, whether 34%, 27% or 15%, Bulgaria will have a blocking minority share. We will be involved in this project from beginning to end, with the ability to make decisions on all matters of importance for the project throughout its service life. This has to be done because the project is in Bulgarian territory and the nuclear risk cover applies to the entire territory of our country," Petkova said.

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In August, total of 13 candidates had expressed interest in the project. Applicants for a strategic investor position included: Bektron-Liaz-Technical Engineering company registered in Germany; Bulgarian consortium AEC Belene, comprising Atomenergoremont, UZK, Grand Yednerzhi and Kvant; Atomna Power Centre Belene 2019 consortium, including Bulgarian company Group International and Czech company Vitkovice Heavy Machinery; and Bulgarian companies IPK and UP. Four bidders expressed interest in lesser roles, either as minority shareholders, or through agreements on the redemption of certain volumes of electricity (or both). These included: Grand Energy Distribution company (Bulgaria) - minority stake and electricity purchase agreement; Atomenergoremont AD (Bulgaria) - minority stake; EuroPian Trade of Energy AD - an agreement on the purchase of electricity; Northern Macedonia - a minority stake and an agreement on the purchase of electricity (the conciliation procedure for the application of this country is still ongoing).

The 90-day period for expression of interest began in May, when the energy ministry published an invitation in the Official Journal of the European Union. According to the call for interest, the station must be operational within 10 years from the signing of an investors’ agreement and its cost must not exceed €10bn for both units. The plant must be built on a market basis, as the state will not sign long-term power purchase agreements with the investor, nor will it provide state guarantees, the energy ministry has insisted. Bulgaria said it would participate in the project company by contributing assets including the licensed site, nuclear island equipment, permits and documentation.

In June 2018, parliament had mandated Petkova to seek potential strategic investors willing to build a nuclear power plant at Belene. Initially, the 2000MWe Belene plant was to be built with the participation of Russia after Atomstroyexport (part of Rosatom) won an international tender in 2006 for the design, construction and commissioning of two VVER-1000 reactors. However, the project was cancelled in 2012, after a change of government. The project was revived, again, in June 2018 after a series of arbitration procedures, which saw Bulgaria pay €601.6 million ($691.5m) in compensation to Atomstroyexport for the equipment already manufactured. These components are now stored at the construction site. As a result, if Bulgaria goes ahead with the project, Russia’s Atomstroyexport will be the main contractor.