China May Invest In EUR700M Romanian Power Plant

05.05.2011 By Andrei Circhelan

The Romanian government wants to team up private investors with its Termoelectrica power producer for the construction of two new production units at the Doicesti plant, in a project evaluated at EUR700 million.

Termoelectrica's privatization and cooperation chief Stefan Arama told a news conference Thursday that the company has concluded a cooperation memorandum on April 14 with Chinese China Huadian Engineering, establishing the investment structure and the project involvement plant.

"The Chinese company is an interface with the actual investor, the Chinese state. Talks were also attended by Eximbank China, which is looking at the project. We believe the Chinese company will invest in Doicesti," Arama added.

In addition, the Asian investor may take over several coal mines in the Muntenia Basin, in order to provide raw materials for energy production at Doicesti.

"The key to the project lies in securing a coal supply in the area. The question is whether (the Chinese company) will secure coal for Doicesti. From what I've gathered in talks with them, they want to invest," Arama said.

The two new coal-fired units at Doicesti would have a total installed power of 500 MW.

The private investor would contribute at least 30% of the project's value (EUR210 million), while the remaining 70% would be covered through loans taken by the project company.

Construction works are set to start in March 2012, but if the partnership fails, the Doicesti power plant will be shut down, Arama said.

China Huadian Engineering is part of the China Huadian Corporation group.