Oil Report

UPDATE 2-RWE signs Belene nuclear plant deal

* Hopes to split 49 pct stake with Electrabel

* Says in talks, hopes for a result “within weeks”

(Recasts with Electrabel agreement, details)

SOFIA, Dec 19 (Reuters) - German utility RWE RWEG.DE signed a deal on Friday to acquire 49 percent in Bulgaria's planned Belene nuclear power plant and said it hoped to split the stake with Belgian peer Electrabel.

In October, Bulgaria picked RWE over Electrabel, owned by French giant GDF Suez GSZ.PA, to become a strategic investor in the 4 billion euro ($5.58 billion) plant and gave it the option to share the stake with the Belgian utility.

The Balkan country is building the 2,000 megawatt plant to help it regain its position as a major power exporter in southeast Europe and also to reduce greenhouse gas emissions.

“This project will guarantee Bulgaria’s energy independence, electricity production and exports,” Prime Minister Sergei Stanishev said at the official signing ceremony in Sofia.

RWE officials said they were holding talks with Electrabel and hope to announce a result in the coming weeks.

“There is a common understanding on all major issues with Electrabel. We hope to reach an agreement to split the stake within weeks,” Antonius Voss, chief financial officer at RWE Power, said after the signing ceremony.

GDF Suez said last month it would decide whether to share the stake after examining the deal agreed between RWE and Sofia. [ID:nLI564897]

Sources familiar with the project have said the global financial crisis and tighter liquidity have made raising funding extremely difficult and it is likely to delay Belene’s start date beyond the planned 2013-2014.

The German power major said the crisis would pose a challenge to raising funds needed for the plant, but remained optimistic that banks would fund Belene.

Bulgaria has picked French BNP Paribas BNPP.PA to help it arrange the financing for the nuclear plant which could increase the cost to above 6 billion euros.

RWE had postponed signing a final agreement with Bulgaria due to protests from green party politicians and anti-nuclear activists in Germany.

Industry insiders have said RWE had sought more evidence about safety plans for Belene, in an effort to defuse the protests.

NEK, which has a 51 percent stake in the project, plans to start construction next year.

Bulgaria lost its position of a leading power exporter in the Balkans after shutting older Soviet reactors at its Kozloduy nuclear power plant as a condition for joining the European Union in January 2007. ($1=.7164 Euro) (Writing by Anna Mudeva; editing by Simon Jessop)