Estonia inks power plant deal with France's Alstom

14th January 2011, Comments 0 comments

Estonian state power firm Eesti Energia on Friday said it had signed a 950-million-euro (1.23-billion-dollar) deal with France's Alstom to build a new electricity plant.

Eesti Energia spokeswoman Marina Bachmann told AFP that company leaders from both sides inked the deal during a visit to Estonia on Friday by Pierre Lellouche, France's foreign trade minister.

The plant will have up to two energy blocs of 300 megawatts each, Bachmann said, with the first due to be completed by 2015. A decision on the construction of the second would be made in 2012, she added.

The plant is to be fired by oil from Estonia's shale reserves, as well as bio-fuels, Eeesti Energia's chief Sandor Liive told AFP after the ceremony.

"Debates about the future of power production have been long and deep and concluded with the decision to build a new power plant that uses local resources. The new plant will be both efficient and environmental-friendly," Liive said.

The plant will be located next to an existing facility in Narva on Estonia's northeastern border with Russia.

Estonia, a European Union member with a population of 1.3 million, covers almost all its energy needs using oil derived from its reserves of shale -- rocks which hydrocarbons.

Narva is the country's energy hub, with 95 percent of the country's power generated in the region.

In 2009, Eesti Energia also struck an accord with Alstom to supply desulphurisation systems at existing facilities in Narva. Alstom has had a long-term service deal with the Estonian company since 2000.

"The agreement we reached is a sign of the trust Eesti Energy has in Alstom's technology and capacity to carry out such a project," the French company's chairman Patrick Kron said in Estonia on Friday.

© 2011 AFP

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