Meliti II inclusion on PPC sale list ‘would affect CMEC plan’

The inclusion of the existing main power utility PPC Meliti I lignite-fired power station and the prospective Meliti II facility to the utility’s bailout-required list of unit sales would require any contract for the latter’s development to be offered through a tender, the corporation’s chief executive Manolis Panagiotakis clarified today during a general shareholders’ meeting.

If the Meliti units are not included on PPC’s bailout-related unit sale list then PPC should not have any issues actualizing its plan, the utility chief pointed out.

Just days ago, deputy development minister Stergios Pitsiorlas noted that collaborations such as a partnership envisaged by PPC with CMEC, the China Machinery Engineering Corporation, for the construction and operation of Meliti II would need to be established through tenders. This was widely viewed as a further government obstacle to PPC’s plans.

“Much will depend on the procedure determining the units to be included in PPC’s sale package,” the PPC chief noted during today’s general shareholders’ meeting. The list of PPC lignite-fired unit sales needs to be prepared by next month.

“Preparing this list is not a simple matter as power stations cannot be split into units, nor is it easy to break up the mines supplying these power stations,” Panagiotakis remarked.

Prior to Pitsiorlas’s remarks, energy minister Giorgos Stathakis announced that a new tender would need to be staged for part of the Vevi mine, whose output would be crucial for Meliti II.

“If the Vevi mine’s current tender runs into trouble then this is sure to create problems with the Chinese investors for the Meliti project,” the PPC head noted. “This would also affect supply for PPC’s existing Meliti I power station,” he added.

 

 

CMEC, fearing developments, places Meliti II plan on hold

CMEC (China Machinery Engineering Corporation) appears to have decided to put on hold the prospect of developing and acquiring majority control of Meliti II, a second carbon-fired power station planned by the main power utility PPC in the Meliti area, close to Florina in the country’s north.

The Chinese company, which has deployed a technical team on a fact-finding mission over the past few months, is troubled by the prospect of a new tender for mining rights in Vevi, whose supply is crucial to the feasibility of Meliti II. Energy minister Giorgos Stathakis recently announced a new tender for Vevi would need to be staged.

Hestitancy has also set in at CMEC as a result of a bailout-required plan obligating Greece to sell a proportion of carbon-fired power stations operated by state-controlled PPC.

According to energypress sources, CMEC has requested an official update on the developments.

A Memorandum of Understanding (MOU) signed by PPC and CMEC last September was regarded as a move in the direction of new PPC partnerships sought by the energy ministry for the power utility.

The plan that had been announced entailed CMEC holding a majority stake in a partnership with PPC for Meliti II, whose construction would be fully funded by the Chinese company, as well as Meliti I, an existing unit.

Vevi mine essential fuel for prospective Meliti II station

Development of Meliti II, a second carbon-fired power station for the main power utility PPC in the Meliti area, close to Florina in the country’s north, would not be possible without guaranteed supply from the nearby Vevi coal mine, as the power station would be deprived of fuel, both market and PPC officials have pointed out.

Just days ago, the Meliti II project’s prospects were shaken by remarks from energy minister Giorgos Stathakis, who declared that a new tender will need to be staged for the nearby Vevi coal mine license as, according to the minister, a previous competition did not comply with regulations. This license concerns one part of the Vevi mine. PPC currently controls the rest.

Presumably, CMEC (China Machinery Engineering Corporation), currently examining the prospect of developing the Meliti II unit, would not get involved if coal supply from the Vevi mine is not assured.

Responding to the minister’s intention, PPC officials were quick to note that besides the Ahlada coal mine, supplying the utility’s existing Meliti I power station, no other approppriate source of coal exists in the area at present.

PPC holds the rights to three coal mines in the region until 2023. The first of these, Klidi, faces serious issues as a result of landslides. The situation cannot be rectified, according to many.

As for the Vevi mine, two options are available. The mine could be co-exploited by PPC along with the privately-owned section. However, the section to which PPC holds mining rights would need to be worked on as a second stage. Another option would be for PPC to begin mining from the hill’s other side. But this would require the Vevi village to relocate. Such a process would require at least five years, not including any legal complications that can be expected to arise. Past cases, elsewhere, suggest that around a decade would be needed.

Lofi, the third coal mine in the region to which PPC holds mining rights, is a doubtful prospect. Questions linger over the quality and quantity of the coal deposit here.

On the contrary, the Vevi mine contains high-quality coal, scientific tests have shown. The coal quality is good enough to serve any thermal station in the country, experts believe.

It remains to be seen what steps the energy ministry will now take for the Vevi mine section to be licensed out to the private sector. An agreement signed in 2014 between the energy ministry of the time and the Aktor company never made it to Greek Parliament for ratification as a result of snap elections that led to political change and an election victory for Syriza, now heading the coalition.

The Bobolas group, which owns a 25 percent stake of Aktor parent company Ellaktor, a Greek construction giant, has repeatedly sought to complete the pending Parliamentary approval for the Vevi mine agreement.

PPC boss insists Vevi mine will not affect Meliti II project

A government plan entailing the development of Meliti II, a second coal-fired power station for the main power utility PPC in the Meliti area, close to Florina in the country’s north, will go ahead, the utility’s chief executive Manolis Panagiotakis has reassured in comments offered to energypress.

The project’s prospects were shaken following remarks made yesterday by energy minister Giorgos Stathakis, who declared that a new tender will need to be staged for the nearby Vevi coal mine license as, according to the minister, a previous competition did not comply with regulations.

Presumably, CMEC (China Machinery Engineering Corporation), currently examining the prospect of developing the Meliti II unit, would not get involved if coal supply from the Vevi mine is not assured.

The state-controlled PPC boss noted that he recognized the need for a new Vevi tender, while expressing confidence that this development would not affect the government’s decision to collaborate with CMEC for the development of Meliti II.

 

Plan for new Vevi mine tender jeopardizes Meliti II project

Energy minister Giorgos Stathakis has disclosed an intention to not have endorsed in Greek Parliament an agreement reached in 2014 by a previous administration’s ministry and Aktor granting the latter exploitation rights of a coal deposit in Vevi, northern Greece, but, instead, launch a new international tender from scratch.

This development greatly threatens the possibility of CMEC (China Machinery Engineering Corporation) taking on a project to develop Meliti II, a second coal-fired power station for the main power utility PPC in the Meliti area, close to Florina in the country’s north. The Chinese firm’s involvement in the Meliti II project is seen to be highly unlikely if coal supply is not ensured.

“The energy ministry reminds that the segment of the Vevi coal mine offered through non-transparent procedures to private investors without an international tender will be reoffered through a legal procedure,” the energy ministry noted in a statement released today.

An agreement signed in 2014 between the energy ministry of the time and Aktor never made it to Greek Parliament for ratification as a result of snap elections that led to political change. The Syriza party was brought to power as the key partner of the country’s coalition.

The Bobolas group, which owns a 25 percent stake of Aktor parent company Ellaktor, a Greek construction giant, has repeatedly pushed for the finalization of the Vevi mine agreement’s pending Parliamentary approval.

PPC-CMEC deal resurfaces pending Vevi mine rights issue

Yesterday’s Memorandum of Understanding signed by main power utility PPC and China’s CMEC (China Machinery Engineering Corporation) for joint development of a second lignite-fired power station in Meliti, close to Florina, northern Greece, could serve as the vehicle to provide leading Greek corporation Aktor the rights to exploit the region’s major Vevi coal mine. The licensing procedure was bogged down by the country’s political transition that brought the Syriza party into power early in 2015.

Aktor, belonging to construction and media magnate George Bobolas, was the highest bidder in a tender for the Vevi mine’s rights. Aktor’s portfolio includes mining, quarrying, construction and photovoltaics.

“We will hold a discussion with the Prime Minister [Alexis Tsipras] during our meeting tomorrow [today] so that the Vevi matter may be cleared up,” PPC president Manolis Panagiotakis told journalists following yesterday’s MOU signing ceremony as Aktor’s deputy Dimitris Koutras listened on.

Aktor, along with the GEK Terna Group, whose CEO Giorgos Peristeris also attended yesterday’s signing ceremony, will join the PPC-CMEC Meliti power station venture the PPC chief noted yesterday.

Access to the major mine in Vevi, estimated to hold 60 percent of the area’s total lignite deposit, is essential to the PPC-CMEC partnership’s prospective power station, which would be fed by this deposit. The Greek-Chinese plan entails including the mine as an asset in the consortium to be established for the project.

The plan for Meliti II entails development of a 450-MW power station at a cost of 750 million euros. Necessary work needed at the regional mines to feed the facility will raise the cost to one billion euros. PPC is believed to be open to the prospect of becoming a junior partner in this venture.

According to energypress sources, Bobolas, Aktor’s chief, has repeatedly called for the Vevi mine deal’s finalization, requiring parliamentary approval. The MOU signed with CMEC is expected to provide the impetus required.

As the winning bidder for the Vevi mine’s rights, Aktor had signed an agreement with the previous administration’s environment and energy ministry in 2014, but it was not endorsed in parliament as a result of the ensuing elections.

Local officials contemplating Russian request for Vevi mine

Russia’s interest to operate Greece’s Vevi lignite mine close to Florina, northern Greece, as an alternative to offset a stalled plan for the construction of two hydropower stations by Russian companies in Sykia and Pefkofyto, alongside the Achelous River in the northwest, adds a new dimension to a long-running ordeal over the mine’s future.

The request was extended by Russian officials to Greece’s energy minister Panos Skourletis during his visit to Moscow earlier this week as a result of legal complexities concerning the Sykia and Pefkofyto hydropower stations.

Construction of the two hydropower stations by Russian companies had been incorporated into a natural gas supply deal between Greece and Gazprom.

Russian interest in the Vevi mine had also been discussed at a recent Greek-Russian meeting in Athens focused on energy matters. In response, the Greek government said it would form a working group to examine the prospect and decide whether interests in the Vevi mine could be transferred to Russia.

Alluding to the issue, the Greek ministry released a statement yesterday noting that “talks between the two sides on energy matters will continue through the work of joint committee formed recently to also examine pending issues.

Russian officials want to operate the Vevi lignite mine and supply the main power utility PPC’s modern Meliti power station. Thoughts for construction of a new station in the area have not been excluded.

If the plan is to be developed, the mine’s operating rights would be transfered to a consortium of Russian interests, in which Prometheus Gas, a joint Greek-Russian venture operated by the Copelouzos Group and Gazprom Export, would play a leading role. The consortium had been awarded contracts to construct the now-stalled power stations in Sykia and Pefkofyto.

Exactly one year ago, Aktor, a company whose portfolio includes mining, quarrying, construction, photovoltaics, facility and project management activities, emerged as the winning bidder of a tender for the Vevi mine and signed a 15-year leasing deal offering it mining and exploitation rights. However, the agreement was never ratified in Greek Parliament as a result of the snap elections that followed soon after, last January, to bring the Syriza-led coalition into power.

A tender for the Vevi mine was originally launched back in 2006 but was later canceled and relaunched with revised terms.

The Vevi mine, located close to Greece’s northern border with the Former Yugoslav Republic of Macedonia (Fyrom), in an area plagued by high unemployment, is estimated to carry a lignite deposit of 90 million tons. It is one of two sources supplying the region’s Melitis power station.