France's readiness to provide a reactor to Gaddafi's Libya has become a hot issue ahead of the election, eclipsing Sarkozy's key role in helping drive the dictator from power last year, which he frequently portrays as one of his achievements.
Trailing in opinion polls four days from the first round of a presidential election, Sarkozy had said on Tuesday there was "never any question" of selling a reactor, denying an allegation from the former head of French nuclear group Areva.
Labelling the accusation on Wednesday as "grotesque," Sarkozy said only a seawater desalination plant had been under consideration in 2007, although he conceded that it would have required a reactor to meet its power needs.
"This project remained at the stage of a project because several months later Gaddafi descended into a folly of destruction," Sarkozy said in an interview with BFM TV.
"There was never the shadow of a possibility of it being made a reality."
However, Libya's popular uprising began much later, not until early 2011, and in the meantime Gaddafi made a state visit to Paris in December 2007 during which France agreed to help Libya build a desalination plant powered by a nuclear reactor, according to remarks by Sarkozy at the time.
"Could current or past Libya have the right to a seawater desalination plant with French technology to run the turbines? The answer is yes," Sarkozy said.
"It was in line with all international rules, there was never any mystery."
Gaddafi was overthrown in August last year and was killed by rebels after his capture following two months on the run.
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