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Power utility gets record loan

SLOVAKIA's major power utility has jumped into the largest company-financing project in the country's history.
The Enel-owned Slovenské Elektrárne has concluded a seven-year revolving line of credit totaling €800 million (Sk26.6 billion) to finance its investment plans in Slovakia. It plans to start drawing the credit in 2008.
"With this loan, we will be able to fulfill our investment plans," Slovenské Elektrárne general director Paolo Ruzzini told the Czech newswire, ČTK.

SLOVAKIA's major power utility has jumped into the largest company-financing project in the country's history.

The Enel-owned Slovenské Elektrárne has concluded a seven-year revolving line of credit totaling €800 million (Sk26.6 billion) to finance its investment plans in Slovakia. It plans to start drawing the credit in 2008.

"With this loan, we will be able to fulfill our investment plans," Slovenské Elektrárne general director Paolo Ruzzini told the Czech newswire, ČTK.

Slovenské Elektrárne plans to invest Sk110 billion between 2007 and 2013. Most of the finances from the line of credit, provided by a consortium of nine banks, will be used to cover the company's ambitious nuclear programme, worth about Sk70 billion.

The company plans to put another Sk40 billion towards acquiring and modernising new production technologies for the thermal power stations in Vojany and Nováky, the company said in an official release.

"We are not focused only on Mochovce (nuclear plant) or some specific projects - all of our investment plans should be covered through this link," Slovenské Elektrárne's financial director, Radovan Okenka, told the public service Slovak Radio.

The company plans to pour money into its existing hydro plants and possibly build small hydro-power plants. Other funds will flow to the area of renewable energy, Slovenské Elektrárne said.

The company acquired the loan without the backing of its 66-percent owner, Enel.

"Thanks to increased the efficiency of our operations, the reduction of the company's net financial debt and the rating upgrade to the investment grade, the company has been granted the credit under very favourable conditions - the reference interest rate plus the 0.325 percent spread," said the company's official release.

Slovenské Elektrárne will try to generate the rest of the Sk80 billion it needs to cover its investment plans from its own resources.

"Over the next five-year period, the company's debt is estimated at only approximately Sk33 billion," company spokesman Juraj Kopřiva told The Slovak Spectator.

The bulk of the Sk110-billion investments planned for the next five years will be used to complete the third and fourth units of the Mochovce nuclear plant, each with a capacity of 440 megawatts. They are expected be put into commercial operation in 2012, Kopřiva said.

Ruzzini said completing the construction of the third and fourth blocks is the most important energy project in Slovakia, according to the TASR newswire.

Construction on the Mochovce site is expected to start later this year, Kopřiva has confirmed.

The utility's new line of credit will be provided by the ING Bank N.V., Calyon S.A., Mizuho Corporate Bank Ltd., Intesa Sanpaolo S.p.A., KBC Bank N.V./ČSOB, Slovenská Sporiteľňa, Komerční Banka Praha, Komerční Banka Bratislava, and Dexia Banka.

Slovenské Elektrárne's investment plans are in line with Slovakia's new energy security strategy to 2030, which Economy Minister Ľubomír Jahnátek presented to the press in late September, Kopřiva said earlier this year.

The strategy sets guidelines for Slovakia for over the next 23 years to establish a stable supply of energy. It projects that both public and private resources will be used to meet these goals, and includes improvements to the country's nuclear utilities.

The strategy assumes the completion of the third and fourth units of the Mochovce nuclear plant by 2013, and the construction of two units at the V3 nuclear power plant in Jaslovské Bohunice.

The country switched off the first V1 unit in Jaslovské Bohunice in late 2006 to comply with European Union regulations on decommissioning outdated Soviet-type nuclear plants. The second unit will be unplugged by the end of next year.

"The construction of the new Jaslovské Bohunice plant should start only after the third and fourth units of Mochovce are completed in 2013," Jahnátek told the SITA newswire.

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