Bulgarian Prime Minister Boiko Borisov says the country will abandon plans to build a nuclear plant on the Danube River if it cannot attract sufficient Western funding for the 8 billion euros project.
Borisov told national BNT channel he had sent ministers to Moscow last month to tell Russian officials that Sofia will not build the Belene plant, for which it had contracted Russian state firm Atomstroyexport.
Borisov said the Belene project cannot go ahead if it fails to attract Western investors and has clear economic and financial benefits for the European Union's poorest country.
Instead, it plans to pay for a 1,000 megawatt nuclear reactor that has already been constructed and will try to install it at its operational 2,000 megawatt Kozloduy nuclear power plant.
The centre-right government has contracted HSBC to carry out a feasibility study for Belene, and expects to receive its report soon.
"But no matter what HSBC says, Belene will not be built as a Bulgarian-Russian plant, without diversification," Borisov told reporters later on Friday.
The project has failed to attract serious foreign investors in the past three years, after Germany's RWE abandoned it in 2009 due to funding concerns.
Sofia has to decide by the end of the month whether or not to push ahead with the project, which had raised diplomatic, safety and financial concerns, but Delyan Dobrev, nominated for economy and energy minister, said the deadline is likely to be extended again.
Bulgaria's allies in Brussels and Washington have long expressed concerns that a new Russian-made nuclear plant will increase Bulgaria's dependence on Russia which may use its energy might for a political influence.
The nuclear disaster in Japan last year led to increased pressure on Bulgaria from environmentalists and lobby groups to abandon the project which, they say, will be built near an earthquake-prone area and will be too expensive.
Borisov said that a final decision on the fate of the controversial Belene project had yet to be taken as the Balkan country has already spent 1.4 billion levs on the project.
"Such a decision can be taken only after a wide public debate. I will seek whether we can call a referendum on Belene," Borisov said.