Kosovo to build new 2,000 MW power plant

By Fatos Bytyci

PRISTINA, July 15 (Reuters) - Kosovo plans to build a new power plant they hope will attract 3.5 billion euros in foreign investment and turn it into an energy exporter, the prime minister said on Wednesday.

The project involves the construction of a new coal-fired power plant with a capacity of up to 2,000 MW and development of a new lignite mine nearby.

"The new plant will produce 2,000 MW and it will be divided in two phases. In the first phase the plant will produce 1,000 MW and will be built immediately," Prime Minister Hashim Thaci told a news conference.

Thaci did not say when the government would select a winner or when he expects the plant to start producing power. "The new plant will be able to produce enough energy for our consumption and also for export," he said after a government meeting.

Three foreign groups, Czech power firm Cez (CEZPsp.PR) and AES (AES.N) of the United States; Italy's ENEL [ENEFN.UL] and Greece's Public Power Corp (DEHr.AT)'s Sencap; and Germany's EnBW (EBKG.DE) and U.S.-based WGI, are in the running to build the project

Germany's RWE (RWEG.DE) ended its bid on Tuesday.

"The project has faced a slower development than the initial plan and in the meantime new growth opportunities had also emerged for RWE," a press statement said.

Two existing older coal-fired plants, Kosovo A and Kosovo B, are in poor condition and cannot produce the some 1,000 MW that Kosovo needs. The Kosovo A plant falls short of existing environmental standards and will be closed by 2015.

Kosovo, which boasts a population of two million people, has around 14 billion tons of lignite and is plagued by power shortages. (Edited by Michael Kahn)