December 19, 2012 / 9:18 AM / 5 years ago

UPDATE 1-CEZ still in talks with Czech Coal over supplies-report

* CEZ prefers new contract, Czech Coal bidding for plant

* Pocerady one of several plants put up for sale in EU case

* CEZ CEO says does not want to sell under pressure (Adds quotes, Temelin expansion)

PRAGUE, Dec 19 (Reuters) - Czech electricity company CEZ is still in talks with supplier Czech Coal over deliveries to its Pocerady power plant from next year, CEZ Chief Executive Daniel Benes said in a newspaper interview published on Wednesday.

Pocerady is one of five coal-fired power plants that state-controlled CEZ has put up for sale to end a European Commission investigation into suspected anti-competitive behaviour.

Czech Coal, which is in a running dispute with CEZ over supply contracts, has bid for the plant. Its offer formally expired on Tuesday.

Benes was quoted as saying in Hospodarske Noviny that CEZ preferred to get a new contract on coal supplies for Pocerady from Czech Coal rather than sell it the plant under pressure.

In case the two parties do not reach a deal, CEZ has said it has a plan to decrease Pocerady’s power production from January and partly supply the plant from its own mines, which is more expensive and would leave Czech Coal without its key consumer.

Pocerady has been one of CEZ’s most profitable plants, and Benes said it was in the interests of both firms to solve the current stalemate.

“Either there will be a new purchase contract or some other way, (such as) that we could theoretically sell the plant or they sell us the mine or that we could create a joint venture,” Benes said.

“We will not be put in a situation where we would sell a plant under pressure ... The preferred option is, for us, a good contract for coal deliveries to Pocerady.”

CEZ has said it aims to decide on the sale of at least 800 MW of capacity this year.

Benes said that according to consultations the company has had with the Commission, however, a ruling on the divestment plan was not likely by the end of the year.

Besides the 1,000 MW Pocerady plant, CEZ has also offered 800 MW units at Chvaletice, Detmarovice or the combined Tisova and Melnik 3 power stations.

CEZ is also in the middle of a multi-billion dollar tender to expand its Temelin nuclear power plant in the country’s largest ever energy deal.

It said on Tuesday it would delay evaluating tender offers to build two new reactors at Temelin until February due to an appeal from France’s Areva, which has slowed the process.

CEZ said the delay would not impact the overall schedule of the tender, with construction to begin in 2017.

In the Hospodarske Noviny interview, Benes said he hoped legislation could be put in place next year for using a model of guaranteed fixed prices, which would cut the risk of expanding Temelin.

Separately, Benes said the company would submit a preliminary bid for two heating plants put up for sale by Swiss firm Alpiq. (Reporting by Jason Hovet; Editing by Dan Lalor and Jane Baird)

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