3 Min Read
* Poland blocks EDF sale of local assets
* Says decision driven by energy security reasons
* EDF says examines the reasoning
WARSAW, Dec 14 (Reuters) - Poland has blocked the sale of local heating and electricity assets by France's utility EDF , citing the country's energy security, the Polish energy ministry said on Wednesday.
EDF said Poland's objection meant it would not be able to complete the sale of its Polish assets launched at the start of 2016.
"The decision was driven by considerations related to Poland's energy security," a spokesman at the energy ministry said, adding that the decision was issued on Dec. 9.
Poland's ruling conservative Law and Justice party (PiS) wants the country to rely on its own energy resources or at least not to be too dependant on foreign reserves. It has already stepped up actions to reduce reliance on gas supplies from Russia.
Poland put local heating assets owned by French EDF and Engie on a list of companies deemed important for energy security in order to be able to block their potential sale.
In October EDF entered exclusive talks with IFM investors over its heating plants and with the Czech Republic's EPH over the coal-fired 1.8 gigawatt power plant in Rybnik, south of Poland.
Polish state-run utilities PGE, Enea ,ENAE.WA>, Energa and PGNiG also submitted a joint bid for EDF' assets, but it was not clear whether they entered the sale process.
In Poland, EDF owns five heating plants which hold a 15-percent share of the heating market. Its 1.7 gigawatt (GW) coal-fired power station in Rybnik, in the south, generates about 7 percent of electricity consumed in Poland.
"The EDF Group regrets this decision, which precludes it from exercising its legitimate rights as a shareholder, in particular the right to close the ongoing sale processes with EPH and IFM," EDF said in a statement, adding it was examining the reasoning underlying the refusal.
The sale of EDF's heating assets comes amid challenges to Poland's electricity system.
The country needs to close some of its most outdated and polluting coal-fuelled power stations and at the same time struggles to secure financing to build new ones to avoid power shortages.
The decision by the energy ministry follows Poland's move to scrap a multi-billion deal to buy helicopters from France's Airbus, which already strained the relations between the two countries. (Reporting By Agnieszka Barteczko Editing by Jeremy Gaunt)