The contracts for construction of the UNIT II of TPP Pljevlja have been signed in Pljevlja

After two years of intensive negotiations, the contracts on construction of Unit II of Thermal Power Plant Pljevlja have been signed between EPCG and ŠKODA PRAHA. The contracts worth €324.5 million have been signed by Peter Bodnar, Chairman of the Board of Directors and Martin Pohlodek, Vice president of the Board of Directors on behalf of ŠKODA PRAHA and Chief Executive Officer Tonino Maglio on behalf of EPCG. The contracts signed are Early Works Service Agreement (EWA) and Contract on Execution of Works (EPC).

The construction of the Unit II has a historical importance for Montenegro, as it is the first big energy facility that is going to be constructed after 35 years. It will make Montenegro an energy independent country that is one of the main preconditions for stable and prosper economic and social development of the country. For the local citizens, it will mean solving the problem of heating which is causing the most of environmental pollution as UNIT II will offer the starting point for the district heating project for citizens of Pljevlja. 

CEO of EPCG, Tonino Maglio, has emphasized that: ‘Construction of energy facilities means investing in the Company’s stable future as well as in local community and the country. I hope that we will complete all the tasks within the established deadlines, as guaranteed by the company ŠKODA PRAHA, our referent partner in this project.  I’m pleased that finalization of this project will result in a stable source of electricity generation for EPCG. Also, construction of the Unit II will significantly boost economic development of our country, as well as our country’s entire development. I am particularly satisfied with the fact that construction of the Unit II will significantly improve ecological situation in Pljevlja, as well as the quality of life of citizens of Pljevlja’.

Mr Peter Bodnar, Chairman of the Board of Directors of ŠKODA PRAHA, expressing his gratitude to all parties included in the project, explained what is next to come: ‘’We believe that EWA (Early Works Service Agreement) results play a key role in  speeding up the process of project engineering and possible construction with aim to replace Unit 1 in time. Also, at this time we have to define the detailed scope of supplies necessary to perform an EPC (Execution of Works) contract. Second step is the common task of all of us and it is to obtain permits for site. In parallel, full and joint support will be on going related to secure financing for the implementation of the EPC phase’’.

Construction of the UNIT II will comply with guaranteed terms and conditions of EU standards for coal combustion (PC) technology in Unit II. The modern best available techniques (BAT) are planned to be applied, including all the activities on cleaning of waste gases in accordance with the EU Directive. Also, this project includes the selective catalytic reduction (SCR), for reduction of nitrogen oxides, in case more rigorous international standards appear in future. 

Let us remind you that 13 Invitations for Bids were sent in June 2013, including definition of technical and commercial conditions. Following intensive discussions and explanations, there were 9 bids in total received by the end of October of the same year. The concerned bids having been evaluated based on already defined criteria, the most favourable preliminary bid was finally obtained in April 2015 - the bid prepared by the Czech Company ŠKODA PRAHA.

Following adoption of the interstate agreement between Montenegro and the Czech Republic and official confirmation of the contract by the two parties, all the necessary documents were approved by EPCG's Board of Directors which forwarded the document to shareholders of EPCG which, in their capacity of the competent authority, adopted  these documents on September 9th 2016, thus fulfilling, formally and legally, all the conditions for signing of the contracts and commencement of the works on implementation of this Project.