July 29, 2013 / 11:01 AM / 6 years ago

U.S. export bank offers to co-finance Czech nuclear plant

PRAGUE, July 29 (Reuters) - The U.S. Export-Import Bank is prepared to lend Czech power group CEZ around half the cost of enlarging its Temelin nuclear power plant if U.S. bidder Westinghouse wins a tender to build it, the bank’s president said.

Fred Hochberg told Czech Television the bank would lend as much as allowed under rules defined by the Organisation for Economic Cooperation and Development (OECD), a group of developed nations.

Westinghouse, a unit of Japan’s Toshiba Corp, and Russia’s Atomstroyexport are bidding in a tender to build two new blocks at Temelin to more than double its size.

The project, the Czech Republic’s biggest ever energy deal and estimated to cost more than $10 billion, is facing uncertainty.

A CEZ board member said this month the company may delay the decision on the expansion by 12-18 months as the government discusses guarantees for future electricity prices.

Hochberg said delays would not change the offer of the bank, which is the official export credit agency of the United States.

“Its condition is of course a Westinghouse win,” he said. “As long as they take part in the project, the offer of financing will be there.”

Hochberg said the loan could run for 25 years and its interest rate would likely be at about 1 percentage point above U.S. 10-year treasuries, so around 3.5 percent, plus some fees.

Uncertainty over the project’s timing increased last month after Prime Minister Petr Necas resigned amid a graft and spying scandal. The central European country could face an unstable year before scheduled elections.

The interim cabinet of Prime Minister Jiri Rusnok, who has not won a parliamentary confirmation yet and seems unlikely to do so, said his administration would not make any definitive decision regarding the Temelin tender.

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