The main power utility PPC looks set to cut its electricity supply to the troubled state-controlled general mining and nickel producer Larco, whose unpaid electricity bill amount is continuing to rise, energypress sources have informed.
Besides falling further behind on unsettled electricity bills of the past, the industrial enterprise is unable to cover the cost of its current power consumption, which has led to an overall bill of nearly 250 million euros.
The Larco case was emphatically tabled by European Commission officials during the most recent round of bailout negotiations in Athens, sources noted, adding that the Greek government was asked to stage a tender for the industrial firm that would offer its sustainable divisions.
Subsequently, state-controlled PPC appears to have no other choice than to pull the plug on Larco. If the power utility remains tolerant, it risks being scrutinized for protecting shareholder interests and Greece will face the prospect of needing to return state aid worth 135.8 million euros, provided between 2008 and 2011, which has been ruled as illegal by the European Court. PPC holds an 11.4 percent stake in Larco.
The state aid case against Greece has remained pending since 2014, when the European Commission informed Greece of the verdict and requested an immediate return of the amount. The Greek government at the time had reached an agreement with the country’s lenders to break up and sell Larco as a number of units.
This plan did not proceed. The country’s succeeding administration, the Syriza-Anel coalition, still in power, opted to hold on to Larco as a state-controlled enterprise and spoke of plans to restructure the firm, which has not occurred.
Last November, the European Court ruled that the Greek State has not taken action, and, therefore, has not complied with its obligations.
At present, TAIPED, the state privatization fund, controls 55.2 percent of Larco, the National Bank of Greece holds a further 33.4 percent and PPC 11.4 percent.
In the past, Larco’s administration told a related parliamentary committee that it had managed to reduce its nickel production costs to 12,500 dollars per ton from 14,500 dollars per ton. At the time, international prices ranged between 9,000 and 10,000 dollars. The price of nickel has since risen to levels of about 13,250 dollars per ton.