Bosnia: “BiH Electric Power Industry” will inject new capital into mines “Kreka” and “Djurdjevik”, SEE Energy News
“BiH Electric Power Industry “will divert funds planned for capital investment in 2014th in order to provide funds to recapitalize “Kreka” and “Djurdjevik” who were damaged in floods.
It will be done by reduction the amount of funds planned within the capital investments allocated for the thermal power plant “Bugojno” for 1 MEUR, while the amount of funds planned for the mine recapitalization will be increased by 1 MEUR.
This relocation of assets does not change the amount of planned funds for “BiH Electric Power Industry” investment for 2014th which amounted to 217.466 EUR.
The continuity of the coal production and sale in mines “Kreka” is jeopardized due to the extent of damage in the mine “Sikulje”, why it is obvious that this company may have trouble in liquidity maintenance, or that they will not be able to use its own funds to meet the obligations to suppliers, employees, liabilities arising from various taxes and other obligations. This would threaten the mining operations and bring into question the coal delivery to the EP BiH and other customers. Given that, EP BiH will recapitalize “Kreka” with 767.000 EUR through payment the cash funds which will provide significant support of the liquidity maintenance.
Also, mine “Djurdjevik” informed EP BiH that damages caused in this mine, and due to which the production at surface mines Potocari and Visca was stopped, could not be repaired with their own funds, so the implementation of business plans, but also current operation and obligations maintenance were jeopardized .
Because of the financial consolidation and the company strengthening “BiH Electric Power Industry” will recapitalize the mine “Djurdjevik” with 256.000 EUR.
Decisions on the “Kreka” and “Djurdjevik” recapitalization should be adopted by the Assembly of EP BiH on July 24th 2014, and the deadline for their implementation is 30 days.
In EP BH note that this transaction will not be a cost than long-term investment and will not affect the company’s financial results in 2014th.
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