Strabag to compensate Croatia's Koncar KET for losses from abandoning deal in Bosnia

Austria’s Strabag, which is pulling out of the construction of Vranduk hydro power plant (HPP) in Bosnia, will compensate its partner in the project, Croatia’s Koncar KET, for any resulting losses, Koncar said on Wednesday.

A joint venture company of Strabag and Koncar KET signed a turnkey contract with Bosnian power utility Elektroprivreda BiH to build Vranduk HPP in January 2016, but the Austrian company is now seeking to quit the project following pricing issues, Koncar said in a Zagreb bourse filing.

Namely, Strabag had sought to increase the contract's price during the preparatory period, after which EPBiH threatened to break the deal. Strabag was, however, the first to lodge a request for the termination of the contract, with negotiations still ongoing.

The 19.6 megawatt Vranduk - Elektroprivreda BiH's first HPP construction project after the war in Bosnia - was expected to generate 100 GWh of electricity per year, increasing the share of renewables in the country's power output and reducing carbon dioxide emissions.

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