Montenegro's EPCG revives tender for Zeljezara Niksic

Domestic and foreign companies are invited to submit a 5-year business plan for the development of EPCG Zeljezara's manufacturing facilities, including the melt shop and forge shop, EPCG said in a tender invitation, adding the lease period is set at a minimum of 5 and a maximum of 10 years.

"When selecting a business partner the advantage will be given to those companies that base their production agenda on the so-called "green steel" production," EPCG noted, adding that the deadline for initiating production needs to be at least 6 but no more than 12 months after a lease agreement is signed.

The proposed monthly rent must be between 30,000 euro ($32,400) and 150,000 euro, according to the statement.

Bidders are also called to present an investment plan worth at least 25 million euro for the first 5 years of operations. The successful bidder should employ a minimum of 100 and a maximum of 150 people in the first 12 months.

In addition, in order to participate in the tender, bidders should present a 150,000 euro first demand bid guarantee that should be valid for a period of 60 days.

Moreover, the selected best bidder should submit a 1.5 million euro performance guarantee 15 days prior to contract signing, payable at first demand and with a validity period exceeding the deadline of the lease agreement by 30 days.

Interested parties can submit their proposals until April 15.

Earlier this week, local media reported that EPCG pronounced the first tender for EPCG Zeljezara's lease unsuccessful after the selected bidder failed to provide complete documentation in terms of guarantees.

EPCG said earlier this month that Swiss-registered company 8B Capital S.A. had remained the sole bidder in the tender for a lease contract, after the offers of the other two bidders - a consortium made up of local company Neksan, China’s Universal Energy and Czech Energy & Industrial Management Advisory Services, and a Swedish tie-up comprising Kvalitetsbygg Gruppen and Uber Nordic, were rejected.

In the first tender, launched in December, the selected investor was also offered a five-year lease contract, with an extension option, and required to pay a minimum monthly fee of 30,000 euro.

EPCG acquired Zeljezara Niksic from Turkey's Toscelik for 20 million euro in December 2022.

Located in the western city of Niksic, EPCG Zeljezara has two 60-tonne electric arc furnaces that can produce an estimated 300,000 metric tonnes of crude steel per year.

($ = 0.925 euro)