Canadian-based renewable energy developer Reservoir Capital Corp. said Milan-based Torno Global Contracting will acquire a 20% stake its Brodarevo 1 and 2 hydro power projects in southern Serbia.
Under a Framework Letter of Intent signed by the two companies, Torno will support the Brodarevo projects and will develop jointly with Reservoir Capital other energy and infrastructure business in the region, the Canadian company said in a statement posted on its website on Wednesday.
Reservoir and Torno also plan to work together on the company’s nearby Vrutci hydro power project and to jointly target the acquisition and development of several hundred megawatts (MW) of primarily hydro electric projects in the region by 2015, the statement said.
Under the terms of the agreement with Reservoir, in return for the Brodarevo equity stake, Torno, which will act as general contractor for the development, will provide financial and technical support to Reservoir for the completion of feasibility work to define the best construction price; completion of a Power Purchase Agreement to sell the power into the market; completion of permitting for construction; and project financing and execution, the statement said.
Reservoir Capital said it is nearing completion of Pre-Feasibility Studies on the Brodarevo projects, defining technical feasibility, conceptual design and scope of work.
According to preliminary estimates, the annual output at the Brodarevo 1 site, with installed capacity of 24.6 MW, is seen at 96.97 gigawatthours (GWh) with construction costs projected at 42.2 million euro ($58.2 million), Reservoir Capital said in February.
The Brodarevo 2 site, with installed capacity of 30.6 MW, is estimated to have a potential for an annual output of 123.41 GWh and will cost 49.577 million euro, the company said at the time.
Torno Global Contracting S.p.A. (www.torno.com) is active in infrastructure construction.
Reservoir Capital (www.reservoircapitalcorp.com) has applied for a 32 MW license at Vrutci, holds four geothermal exploration licenses and is studying various other hydro electric and geothermal opportunities in the region.
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