Following extensive negotiations, the consortium agreed to provide irrevocable debt relief of EUR20 million out of a total contract worth EUR57 million and 30 million lei (EUR6.7 million), Euro Insol said in a statement.
Under the contract, which was signed in 2004, the German-Austrian consortium committed to update and refurbish 20 installations owned by Hidroelectrica. Works started in 2006, but were temporarily suspended because the Romanian company couldn’t honor its financial obligations.
Hidroelectrica also obtained a 10% discount on a contract signed with Germany’s Voith Hydro to upgrade its hydropower plant on the Lotru River, Euro Insol said.
Upgrade works started in 2007 and were completed last year. Hidroelectrica took a EUR66 million loan from the World Bank to finance the project.
Hidrolectrica, Romania’s top energy producer, has filed for insolvency in June this year and is currently undergoing reorganization. The company has total debt worth EUR1.13 billion to 839 private creditors. (EUR1=RON4.4672)