Egypt picks site for first nuclear plant

The decision also puts an end to attempts by business tycoons with strong ties to the ruling family to build sea resorts on the el-Dabaa site selected for the plant. The whole coast is known for its attractive beaches.

President Hosni Mubarak reached the decision after discussions with members of the Supreme Council of Nuclear Energy, according to a statement by presidential spokesman Suleiman Awwad.

Concerns over the environmental impact of the plant had also stalled the decision. Awwad said that studies carried out with help of the UN nuclear watchdog — the Vienna-based International Atomic Energy Agency — revealed that el-Dabaa "is the best, perfect site for nuclear plants."

Hassan Younis, the Egyptian minister of electricity, said the decision is meant to "prioritize national interests and gives a big boost to the Egyptian nuclear program."

The cost of the power plant is estimated at $1.5 billion.

Egypt will open bid proposals for the plant's construction at the end of the year, according to Younis. It is not yet clear how much of the project will be government-financed.

Mubarak first announced plans to launch a number of nuclear power plants in 2007, reviving a program that was publicly shelved in the aftermath of the 1986 accident at a Soviet nuclear plant in Chernobyl.

At the time, Mubarak also pledged to work closely with the IAEA and said Egypt was not seeking to develop nuclear weapons.

Egypt already produces some 84 billion kilowatt-hours of electricity annually, some of which is exported to neighboring countries. Egypt's own demand for electricity increases by an average of six to seven percent each year.

This summer has seen major power outages in many Egyptian cities. The blackouts have stoked Egyptian anger toward the government, which has already come under fire this year for rising inflation and cooking gas and bread shortages.