German utility RWE AG (RWE.XE) is still pursuing a project for the construction of a nuclear power plant in Bulgaria, a company spokesman said Friday, following a report earlier in the day that said the project is on the brink of failing due to lack of financing.
The RWE spokesman added that RWE and its partner, Bulgaria's state-owned National Electricity Co. are currently conducting the project development phase in which they seek to work out various issues regarding the construction of the power plant, including financing.
The project development period will be concluded in the middle of 2010, as previously announced, he said.
His comments came in response to a report in Friday's Financial Times Deutschland that said the project is on the verge of failing. Citing unnamed industry sources the newspaper said the Bulgarian government will likely drop of the project next week because it failed to secure the necessary financing.
The RWE spokesman declined to comment on the Bulgarian government's alleged financing problem.
RWE owns a 49% stake in a joint venture with National Electricity Co, that seeks to build the 2-gigawatt EUR4 billion reactor near the town of Belene. The power plant is expected to begin operations in 2014.
Earlier this week Bulgaria's new Economy, Energy and Tourism Minister Traicho Traikov said the government will review the justification for big energy projects, including Belene, because of the economic crisis.
"What is clear is that work was done on a piecemeal basis, without any idea on how to achieve economic profitability or structure funding," Traikov said after reviewing the project's contracts with the Russian builder Atomstroyexport and RWE.
Traikov said upfront costs amount to more than EUR400 million.