Romanian state-owned power generator Termoelectrica and a consortium formed by German company E.ON Kraftwerke and the Italian energy major Enel, have signed a memorandum of understanding to build a coal-fired unit at the Braila power plant in Romania.
The MoU envisages a joint venture between the three parties for the development of the Braila power plant, with a new 800MW coal-fired production capacity. The project will also utilize the existing assets from the power plant currently in operation.
According to the MoU, an independent valuation of the existing assets of Termoelectrica and an analysis on the new capacity will be carried out, as part of a feasibility study. Based on the results of the feasibility study, expected by the end of 2008, the parties will decide whether or not to implement the power plant project.
Within the joint venture, Termoelectrica will contribute the existing assets of the Braila power plant, while the E.ON-Enel consortium will contribute capital for the investment. The consortium will have the majority of the shares in the joint venture, while Termoelectrica stake will be based on the value of its existing assets.