Eesti Energia finally succeeds selling part of ‘embarrassing’ power plant project

The failed power plant cost Eesti Energia in excess of €5m to build. (Postimees/Scanpix)
10/15/2016 4:24 PM
Source: BNS
Category: Business

State-owned Eesti Energia sold dismantled parts of its former combined heat and power (CHP) plant in Painküla to an unnamed buyer in Russia, the company reported on Friday. Eesti Energia was still looking for buyers, as there were more parts as well as the plot to sell, spokesman Kaarel Kuusk told BNS.

The Painküla plant was built in 2012 to supply Werol, a company processing rapeseed oil, with energy and cooling. The company, owned by businessman Rein Kilk, who was also a member of the supervisory board of Eesti Energia at the time, went bankrupt the same year.

The failed plant led to a million-euro loss and Kilk’s resignation from Eesti Energia’s supervisory board. As Minister of Finance at the time, Jürgen Ligi (Reform) called the project “embarrassing” for the company.

Baltic Agro AS, who bought Werol’s factory, built a gas plant that was cheaper to run instead of using Eesti Energia’s powerplant. Since then, the latter had been trying to sell off the dismantled CHP plant.

“In May this year we sold the core equipment of the CHP plant, which has been dismantled at Painküla by now,” Eesti Energia spokesman Kaarel Kuusk told BNS on Friday. Kuusk said the buyer was based in Russia, but refused to offer details, citing a confidentiality clause in the contract.

Eesti Energia is now trying to find a buyer for the remaining equipment and land.

“We have contacted more than 100 businesses all over the world that could be interested in equipment like this,” Kuusk said. He added that the plant’s cooling equipment, which was very specific, would be dismantled by Eesti Energia and taken to a storage facility near the Iru power plant close to Tallinn to wait for a buyer.

Asked about the size of the loss sustained by Eesti Energia in the project, Kuusk said he couldn’t answer the question, as the process of selling the equipment and the land was still ongoing, and the net outcome depended on the price eventually paid by the buyer or buyers.

The original investment by Eesti Energia amounted to approximately five million euros.

Editor: Dario Cavegn

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