Lithuania ready to reopen talks on Baltic nuclear power project

By bne IntelliNews April 23, 2013

bne -

Lithuania is ready to restart talks over a plan to build a pan-Baltic nuclear power plant with its neighbors, as well as Japanese investor Hitachi, Prime Minister Algirdas Butkevicius said in a statement on April 22, although he added that Vilnius will look for ways to lower the cost of the project.

"The current Visaginas nuclear power plant project, as its terms stand now, is too expensive for Lithuania," Butkevicius said in the statement. "Continuing it is only possible if the commercial terms are improved and other conditions are met."

Discussion of the regional project - slated to cost around €5bn-7bn - has halted since Butkevicius won the Lithuanian elections in October. The vote had a non-binding referendum on Visaginas - a pet project of the preceding right wing government - attached, and the new administration has let the trail go cold since it took power in December.

While neighbours Latvia and Estonia were somewhat taken aback by the aggressive stance of the former Lithuanian government towards Russia - which exports power to the region due to its lack of capacity or connection to European power grids - they have expressed frustration that all discussion of a shared nuclear facility has simply ground to a halt under Butkevicius. The new PM has always said he would follow a more "pragmatic" course with Moscow.

However, Butkevicius said that if Lithuania's partners prove willing to compromise, the nuclear plant could complement planned power links with Poland and Sweden. The statement followed an energy-strategy working group led by Energy Minister Jaroslav Neverovic, which will present its findings to parliament on April 25, the PM's spokeswoman, Evelina Butkute-Lazdauskiene, told Bloomberg. The cabinet must propose an energy-independence strategy to Parliament by May 15.

The working group recommends continuing the Visaginas project only if regional partners sign a contract committing to share costs and responsibilities, and if together with the strategic investor they can help get cheaper financing, according to the statement.

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