April 3, 2012 / 10:26 AM / 6 years ago

UPDATE 2-French wind power decision due this week-minister

* Energy regulator favoured EDF in 4 of 5 farms-report

* Fifth farm for which GDF consortium was in contention may be cancelled

* EDF shares up 3.1 pct after Kepler upgrade

* Proglio says unclear how soon second phase to be launched (Adds additional background, EDF CEO comments.)

By Emmanuel Jarry and Benjamin Mallet

PARIS, April 3 (Reuters) - The French government will likely pick the winners of a 10 billion-euro ($13.3 billion) tender for the country’s first offshore wind farms later this week, Industry Minister Eric Besson said on Tuesday, deciding between three mainly French consortia.

GDF Suez, EDF unit EDF Energies Nouvelles and Spain’s Iberdrola are in the running for slices of five wind parks with as many as 600 turbines and 3 gigawatts (GW) of capacity in the project’s first phase off the Normandy and Brittany coasts.

“We’re discussing it with the prime minister,” Besson told reporters as he left a cabinet meeting, when asked about the tender. A decision should be made this week, he added.

France lags behind in Europe in wind power and these projects aim to help close the gap with other European countries as well as reduce its dependence on nuclear power.

But the European offshore wind power industry also now faces overcapacity problems, competitive pressures and cuts in support from governments trying to plug deficits.

France’s energy regulator, which is advising President Nicolas Sarkozy’s government on the process, favours the EDF-led consortium’s offer in four out of the five wind parks up for grabs, business daily Les Echos reported on Monday.

The tender for the fifth park, for which a consortium comprising GDF Suez, French nuclear specialist Areva and construction firm Vinci was the sole bidder, may be cancelled, the newspaper said.

EDF Chief Executive Henri Proglio said on the sidelines of a news conference that he saw a government decision on the tender for the other parks was “imminent.”

“The regulator has submitted a report which I‘m told is quite positive for EDF,” he said, adding that he had not seen the report himself and that the final verdict would be up to the French government, which controls EDF.

EDF shares were up 3.1 percent at 1130 GMT, outperforming the European utility sector, which was 0.8 percent lower.

Brokerage Kepler earlier upgraded EDF to “buy” from “reduce.”

A second phase of the offshore wind project, for which a tender had been slated to open this month, would double capacity to 6 GW by 2020 and lift total investment to 20 billion euros.

Proglio said he did not know if the second phase would be launched right away.

“If they do request proposals, we’ll be interested,” he added.

French engineering group Alstom, which, along with Danish utility Dong is part of the EDF consortium, also has a lot riding on the tender result as it sees wind turbines as a big potential growth market.

The company recently unveiled a new offshore windmill which it said was the world’s largest. ($1 = 0.7518 euros) (Reporting By Emmanuel Jarry; Editing by Helen Massy-Beresford)

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