Kosovo sees winner of power plant tender end-2007

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PRISTINA, Serbia, The winner of a 3.5 billion euro energy tender that has attracted big international firms will be announced by the end of 2007, Kosovo's energy minister said on Wednesday.

The project involves the construction of a 2.47 billion euro coal-fired power plant with a capacity of up to 2,100 MW, the overhaul of the existing electricity plant and development of a new lignite mine nearby.

"We will have a decision in October, November or December on which company or consortium has won the tender," Kosovo's Energy and Mining Minister Ethem Ceku told Reuters.

The government has narrowed the race down to four bids:

- a joint bid by Czech power firm CEZ , the largest central European company, with AES of the United States

- a joint bid by Italian energy group ENEL and Sencap, a consortium of Greece's Public Power Corp. (PPC) and U.S. energy company ContourGlobal

- a bid by Germany's RWE , one of Europe's biggest electricity generators

- a bid by a consortium of German utility EnBW , part-owned by France's EDF , and U.S.-based WGI.

Ceku said the entire project would cost around 3.5 billion euros ($4.65 billion).

"In 2008 the company or consortium will start building the power plant," he said. "The plant, Kosovo C, will start working in 2012."

He added that the Kosovo government might hold as much as 49 percent of shares in Kosovo C.

Lignite, one of the cheapest forms of fuel used by power plants to produce power, is Kosovo's largest resource, with around 10 billion tonnes.

The province of 2 million people, which has been run by the United Nations since NATO bombs drove out Serb forces in 1999, is still plagued by power shortages. U.N. officials say it has the natural resources to become a regional electricity exporter.

A decision on the demand of the 90-percent Albanian majority for independence from Serbia is expected in the spring. Local officials hope that political clarity will encourage much-needed foreign investment and lift the province out of poverty.

((Writing by Matt Robinson and Ellie Tzortzi, editing by Paul Gallagher. Belgrade newsroom +381 11 311 4305))

($1=.7532 Euro)

Keywords: KOSOVO/ENERGY

[Reuters/Finance.cz]