Bosnia’s RiTE Gacko May Start Activities on Project for New TPP in 2015

Bosnian state-controlled coal miner and energy producer RiTE Gacko [BANJ:RITE-R-A] plans to launch this year activities on a project for the construction of a 300 MW thermal power plant (TPP), the government of the Serb Republic entity said on Thursday.

A Chinese state-owned bank and a Chinese partner have expressed interest in the project, which will be implemented by state-owned power utility Elektroprivreda RS, a government statement quoted the entity’s energy and mining minister Petar Djokic as saying after he visited RiTE Gacko, a unit of Elektroprivreda RS Holding.

RiTE Gacko, which operates a 300 MW coal-fired TPP capacity, ended 2014 with a loss of below 10 million marka ($5.8 million/5.1 million euro), mainly due to the poor quality of the coal and lower output, but the exact figure is not known yet, the company’s director Milenko Milidrag said.

Milidrag added that RiTe Gacko plans to buy new equipment worth 15 million marka this year.

In September 2014, Czech energy group CEZ said it has been awarded around 7.5 million euro in damages as part of successfully completed arbitration proceedings over a breach by the counterparty of obligations arising from the contract for the implementation of the Gacko TPP project signed in 2007.

In 2006, an investment agreement was made between the Serb Republic and CEZ, based on which a joint holding was to be formed with Elektroprivreda RS for the purpose of reconstructing the existing Gacko power plant, revitalizing the adjacent coal mine, and building a new TPP, Gacko II.

The project was abandoned before the start of major capital investments.

The Serb Republic is one of Bosnia's two autonomous entities. The other one is the Muslim-Croat Federation.

Elektroprivreda RS runs one more coal mining and thermal energy complex, RiTE Ugljevik, as well as three hydro power stations.

RiTE Gacko's electricity output rose 4.24% to 1,773 GWh in 2013 when the company turned to a net profit of 4.5 million marka from a net loss of 4.9 million marka a year earlier.

Source: SeeNews