May 10, 2018 / 1:00 PM / 3 months ago

GE says may work with Polish Rafako and Polimex on Ostroleka plant

WARSAW (Reuters) - GE Power, part of a consortium due to build Poland’s last coal-fueled power plant, may subcontract the project to Polish builders Rafako and Polimex-Mostostal with whom it has worked before, a GE Power executive said.

In April GE Power, together with Alstom Power, won a tender to build the 1,000 megawatt plant in Ostroleka, northeast Poland, for Polish utilities Energa and Enea with a bid of 6 billion zlotys ($1.68 billion).

A consortium of Polimex-Mostostal and Rafako failed to win the tender with a bid worth 9.59 billion zlotys as did China Power Engineering Consulting Group, which offered 4.85 billion for the contract.

“We consider cooperation with Rafako and Polimex–Mostostal, but we have not started any discussions with them,” said GE Power Chief Commercial Officer Michael Keroulle.

He added GE Power definitely intended to explore options for Ostroleka with the firms but needed to wait for the tender procedure to finish, with a signature from Enea and Energa.

It is not clear when Enea and Energa will sign the deal. The utilities aim to take advantage of a back-up power capacity scheme approved by the EU in February as banks have been reluctant to finance coal.

“The project has to be under construction some time before the end of the year. We would expect to sign the contract with Energa and Enea within a month or a month and a half,” Keroulle said.

GE Power, which is currently a consortium partner building two 900 MW coal-fuelled units at Opole power plant for Poland’s biggest power group PGE, is also looking closely at Poland’s plans to build its first offshore wind farms and nuclear power station, as big coal projects disappear.

GE Power is working with Polimex at Opole and has used Rafako as its subcontractor in Poland for many years.

“It is a very interesting time for Poland’s energy. Midterm we could see the start of offshore wind, lignite will likely disappear and then nuclear power would fit,” Keroulle said.

He added shortages on the labor market were an issue faced by construction companies in the energy sector and one of the reasons why the Opole project is delayed.

($1 = 3.5697 zlotys)

Reporting by Agnieszka Barteczko; Editing by Alexandra Hudson

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