New doubts about Ignalina plant

VILNIUS -- The discussion over arrangements for theproposed new Ignalina nuclear power plant show no sign of being resolved anytime soon with news that Poland may be considering pulling out of the projectaltogether.

A report in the Wall Street Journal Polska,taken up subsequently by financial newswire Bloomberg, quoted unnamed PolishEconomics Ministry sources as expressing serious reservations about 'IgnalinaII'.

LithuanianEconomy Minister Vytas Navickas denied that he had heard any such informationfrom his Polish counterpart.

"I think that information is untrue since I met withthe new Polish economy minister in Brussels on December 3, and there were noindications that Poland might pull out of the nuclear power plant project,"Navickas said in a radio interview.

Moreover, no doubts concerning the project had been voicedat the meeting of the presidents of the two countries held in late December, headded.

The new power plant in Lithuania is expected to be built by four countries - Poland, Latvia, Estonia and Lithuania, which is currently trying to establish a company, Leo LT, tohandle the project.

Lithuanian plans envisage an arrangement by whichLithuania would hold 34 percent of a joint venture,with the other three countries getting a 22 percent stake. However, Polandhas previously demanded that it would need to receive at least a third of theplant's eventual electricity output for it to be an attractive proposition.

The 6 billion euro plant was initially aiming for a 2012switch-on date. Officially the target is now 2015, though most experts agreethat 2020 is a more realistic date.

Lithuania's government faces difficulties at home as well as regarding theuncertain status of Polish commitment to the project. Lithuania'sopposition Conservatives are voicing doubts about the economy minister'sstatements that Leo LT is the right vehicle to building the new nuclear plantplus proposed power grid links to both Swedenand Poland.

The Conservatives' leader Andrius Kubilius said that a Dec.3 meeting between the party and Vytas Navickas produced an impression that thenegotiations with the private equity company NDX Energija on establishment ofthe national investor company were not yet completed.

"There is no consistent explanation, our doubts wereraised further," Kubilius told journalists after the meeting.

Responding, Navickas said the shareholder agreement betweenthe government and NDX Energija contained sufficient guarantees, saying "Theagreement and draft bylaws of the company clearly state that the company pursuesits aims and primary task plans to build a nuclear power plant and both energybridges to Sweden and Poland."

Leo LT would be created by merging the state-owned sharesin the distribution grid operator Rytu Skirstomieji Tinklai (RST) and inLietuvos Energija with NDX Energija's shares in VST. The state would retain61.7 percent of Leo LT.