Energa and Enea signed an investment contract on a joint realisation of Ostrołęka C Power Plant
Energa and Enea concluded an investment contract on 8 December 2016 the intention of which is joint preparation, construction and exploitation of a ca. 1,000 MWe gross bituminous coal fired power unit in Ostrołęka. Enea will buy 50 per cent of shares worth of PLN 101 million held by Energa in the share capital of the special purpose vehicle established for the realisation of the Project. The terms of cooperation agreed upon by the parties should contribute to the announcement of the tender already in 2016.
The contract was concluded by Energa SA, Enea SA and Elektrownia Ostrołęka SA, i.e. a special purpose vehicle incorporated by Energa to implement the project. A condition precedent suspending the investment contract’s entry into force is obtaining the consent of the President of the Office of Competition and Consumer Protection to perform the consolidation being the acquisition of the shares in the special purpose vehicle to implement the Project.
Energa and Enea split the planned cooperation into three stages. They will include respectively: Development Stage, which will last until the instruction is given to commence works for the general contractor; Construction Stage, which will cover the period until the commissioning of Ostrołęka C Power Plant for commercial operation and Exploitation stage during which Ostrołęka C Power Plant will be used for commercial purposes.
- During several recent months the project of the new power plant in Ostrołęka has gone a long way, from the freezing stage, to readiness for tender with two strong partners on board. The current contract closes down another important stage of arrangements and demonstrates our determination to implement the investment. At the same time, we are attentively awaiting regulatory decisions since they will stimulate further works - says Dariusz Kaśków, President of Energa SA.
The terms of cooperation agreed upon by Energa and Enea should guarantee the possibility of announcing a tender for the selection of a general contractor for the new power unit until the end of 2016, with the aim of completing the investment in the second half of 2023. The companies undertook to participate in the Construction Stage assuming that the Project’s profitability condition will be satisfied and its financing will not breach their bank covenants.
Energa estimates that its capital expenditures until the end of the Development Stage will amount to ca PLN 27 million. On the other hand, Enea estimates that its total capital expenditures until the end of the Development Stage will amount to ca PLN 128 million. The amount includes also the acquisition of 50 per cent of shares in the special purpose vehicle established for the Project realisation.
- The investment will strengthen our position on the market of energy producers and is in line with the adopted Enea Capital Group’s Development Strategy until 2030. The new unit of Ostrołęka C Power Unit will be another, highly-efficient and low-emission source of energy in the Public Power System. It will significantly affect the Polish energy security – emphasised Mirosław Kowalik, President of Enea SA. - Realising Ostrołęka C Power Plant project we will use our knowledge and experience gained on the construction of a new 1,075 MW unit in Kozienice Power Plant - added Mirosław Kowalik.
Energa and Enea foresee that the construction of Ostrołęka C Power Plant will last for about 60 months. The special purpose vehicle - Elektrownia Ostrołęka SA - holds a complete technical documentation and administrative decisions enabling publication of the tender announcement.
The key assumption of the Project is the implementation of a profitable investment which will guarantee a satisfactory rate of return for shareholders. The Project also anticipates openness to the participation of financial investors and investment funds.