SARAJEVO, Sept 3 (Reuters) - Bosnian utility EPBiH expects a generating unit at its Tuzla coal-fired power plant, which has been backed by China, will cost 1.8 billion Bosnian marka ($1.1 billion) to build.
Balkan states are increasingly turning to Beijing for project funding as the European Union, World Bank and other institutions cut back on financing coal-based projects.
Chinese firms are considering energy and infrastructure projects worth more than 3 billion euros ($3.5 billion) in Bosnia alone.
The state-funded Export Import Bank of China will provide a 1.2 billion marka loan for what will be the largest investment in Bosnia’s post-war energy infrastructure under a deal signed in November, EPBiH said in a statement on Monday.
EPBiH picked a consortium of China Gezhouba Group and Guandong Electric Power Design to build the 450 megawatt (MW) unit in 2014, but the project has been delayed by red tape and negotiations over financing.
However, the government of Bosnia’s autonomous Bosniak-Croat Federation, where EPBiH is based, agreed to guarantee the loan last month and on Monday EPBiH said it will invest 470 million marka of its own funds in the project by 2023, as well as taking loans of 141.3 million marka from commercial banks.
Shareholders at EPBiH are due to vote on the strategic partner and financial plan on Sept. 18, while government officials have said they expect parliament to approve the loan and the whole project before Bosnia’s Oct. 7 general election.
Environmentalists object to the coal projects planned with China, saying they do not meet EU rules and could add to already high levels of air pollution, while also exposing cash-strapped Bosnia to costly plant upgrades once it joins the bloc. (1$ = 1.679 Bosnian marka) ($1 = 0.8608 euros) (Reporting by Daria Sito-Sucic; Editing by Alexander Smith)