Romania's CE Oltenia, Alro to invest 108.5 mln euro in 850 MW gas-fired power plant

CE Oltenia will contribute 65 million euro ($63.4 million) into the capital of the project company, which will give it a stake of 59.9%, whereas Alro will participate with 43.5 million euro for a 40.1% stake, CE Oltenia said in a press release on Monday.

The total value of the project in the southern county of Dolj is estimated at 506 million euro, with financing coming also from the EU's Modernisation Fund which supports 10 lower-income member states to meet 2030 energy targets by helping them to upgrade energy systems and improve energy efficiency.

The project is estimated to be functional in 2026, replacing two old coal-fired units of 315 MW each in Isalnita commune.

Alro announced on Thursday that it has been declared 'selected investor' by CE Oltenia following a public tender to build the plant.

The project is part of the restructuring plan for EC Oltenia, which was approved by the European Commission in January and stipulates the construction of two gas-fired plants and eight photovoltaic parks in order to diversify the energy mix and facilitate transition to sources of less polluting energy, as well as to restore the viability of the company.

CE Oltenia is Romanian public company active in mining, power generation and local heat supply. The company is the third largest producer of electricity in Romania.

On Friday, energy minister Virgil Popescu said that Romania plans to allocate over 900 million euro from the the Modernisation Fund to refurbish CE Oltenia.

A subsidiary of Vimetco N.V., Alro is one of the largest vertically integrated aluminium producers in Europe with an installed production capacity of 265,000 tonnes of electrolytic aluminium per year, 35,000 tonnes of recycled aluminium and 335,000 tonnes of primary cast aluminium.

Alro's shares closed 0.37% higher at 1.3450 lei ($0.27/0.27 euro) on Monday on the Bucharest Stock Exchange. They did not trade on Tuesday morning.

(1 euro=4.9360 lei)