March 24, 2009 / 12:26 PM / 10 years ago

Bosnia utility mulls $1 bln power plant project

SARAJEVO, March 24 (Reuters) - Bosnia’s largest power utility, Elektroprivreda BiH, said on Tuesday it was seeking concessions to build two hydro-power plants worth 750 million euros ($1.02 billion) on the Drina river bordering Serbia.

EPBiH General Manager Amer Jerlagic said the utility would invite Serbian counterpart Elektroprivreda Srbije (EPS) to join the project, the largest single investment by the Bosnian utility, in a joint venture.

“We expect the state concession commission to reply to our request in a month’s time and if it gets a green light, we will immediately start negotiations with EPS as we believe the project is in our common interest,” Jerlagic told Reuters.

He said the plants would have a combined capacity of 300 megawatts of electricity and added that such projects were aimed at easing the impact of the economic crisis.

“The project would ... fully engage the local construction sector, energy equipment producers and other businesses, as well as create new jobs,” said Jerlagic.

The company has announced investments of close to 1.5 billion Bosnian marka ($1.04 billion) to overhaul existing facilities and construct new hydro and thermal power plants and renewable energy resources in the next three years.

EPBiH, located in Bosnia’s Muslim-Croat federation, was Bosnia’s only power company while it was part of the former Yugoslavia. But after the country split along ethnic lines during the 1992-95 war, separate Serb and Croat-run utilities were formed.

The Serb Republic’s state-owned Elektroprivreda RS (EPRS) has also announced investment in hydro-power plants this year.

It and Serbia’s EPS have agreed to set up soon a joint venture to build four hydro-power plants on the upper Drina river, worth 450 million euro, with total annual output of 800 million kilowatt-hours.

Jerlagic said the two projects would not overlap as EPBiH intends to build the plants in the central stretch of the river.

EPRS has awarded a series of concession contracts for the construction of small hydro-power plants in the Serb Republic but still needs to implement them.

Bosnia is one of the few countries in the region seen as capable of exporting electricity. Its neighbours rely on imports to cover between 30 and 50 percent of consumption. (Reporting by Maja Zuvela; Editing by Adam Tanner, John Stonestreet)

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