Myroniv TPP Reconstruction Plan Adopted

The government has approved a plan for the reconstruction of the first power unit of the Myroniv thermal power plant, a subsidiary of Donetskoblenergo (DOON) which is leased by a private company, Isida LTD. The plan foresees construction of a 140 MW power unit over four years, the cost of the project is USD 106 mln, or USD 760 per kW of new capacity. The payback period is 8.5 years. Alexander Paraschiy: It is not clear at the moment who will construct the new power unit: Donetskoblenergo or Isida LTD. Taking into account Donetskoblenergo’s financial situation (USD 122 mln net losses for 2006, USD 865 mln payables, USD -295 mln book value), it is hard to imagine that DOON will be able to reconstruct the TPP, even if up to 80% of the reconstruction costs will be covered by a special surcharge to its power tariffs. We see the project being spearheaded by Isida, or DTEK, the largest minority shareholder of Donetskoblenergo.