ECONOMY

Sofia extends deadline

SOFIA – Bulgaria’s privatization agency said yesterday it has extended a deadline by two days, until today, to close a troubled 578.8-million-euro power plant sale to Russia’s Unified Energy System. The deal has been delayed six times since May, hindered by regulatory, anti-monopoly and other hurdles, highlighting the Balkan European Union candidate country’s difficulties in major privatization projects over the past several years. UES originally won the right to buy two thermal power plants in the cities of Varna and Rousse, but it opted for the 1,260-megawatt Varna plant after anti-monopoly authorities ruled it could buy only one – contrary to the tender conditions. Since then, the Russian electricity monopoly has balked at regulatory commitments and disputed a deal signed by the generator’s management with Germany’s Siemens to upgrade the plant after the tender. «These are very difficult negotiations, but I hope we will see a deal in the end,» privatization agency head Todor Nikolov told Reuters. The Varna generator, located on the Black Sea, is Bulgaria’s second-largest thermal power plant. Nikolov said Bulgaria had also reached an agreement with Siemens to cancel the 11-million-euro upgrade contract. The final closing of the sale must be approved by the privatization agency’s supervisory board. Offering 578.8 million euros in cash and investment, UES outbid Czech group CEZ, Italy’s Enel and Greece’s Public Power Corporation (PPC) for the 100 percent stake in the coal-fired plant. The difficulties in the sale add to a string of troubles as Bulgaria tries to privatize part of its power generation capacity, as it gears up to join the EU and its single energy market in 2007. Apart from the suspended Rousse deal, the sale of a third plant in the western Bulgarian town of Bobov Dol collapsed in July after the privatization agency said PPC’s winning 105.3-million-euro bid was too low.