Business & Finance

Verbund tops bidding to build eight Bosnia plants

Austrian hydropower utility Verbund submitted the highest bid in a tender to build eight hydropower and thermal plants and a coal mine in Bosnia, with an offer of 3.5 billion euros (US$4.49 billion), Bosnian media reported.

Sarajevo-based daily Dnevni Avaz quoted the Energy, Industry and Mining Minister of Bosnia’s Muslim-Croat federation saying Verbund’s offer was the highest of 37 international companies’ bids in a solicitation opened on August 23.

“I am pleased that we have strong interest from international companies in particular, which confirms how serious this project is,” the daily quoted Minister Vahid Heco saying August 25.

Heco said the offers for the eight hydro and thermal plants and the mine would be carefully analyzed and presented to a government commission, which will select a strategic partner by the beginning of September.

A consortium of Germany’s Siemens and other smaller firms is also among the bidders, with an offer of 2.5 billion euros (US$3.2 billion) for construction of the facilities. Other bidders include Denmark-based Energy Financing Team, Italian utility Enel, Czech power group CEZ, German utility EnBW, and Norway’s Statkraft.

In 2003, Austria and Bosnia negotiated a memorandum under which Austria would provide 350 million euros (US$408.6 million) in funding for new hydro plants in Bosnia, helping Austria meet its greenhouse gas reduction target under terms of the Kyoto Protocol on climate change. At that time, an official said Austrian companies had identified eight possible locations for hydropower plants in Bosnia’s two regions, the Muslim-Croat federation and the Serb Republic.