U.S.-Ukraine Energy Trade and Investment Conference

INFORMATION ON INVESTMENT PROJECT

Project Title:

“Installation of 450 MW Power Unit No. 4 with Steam And Gas Turbine-Generator Set at Kharkiv Heating And Power Plant 5 (ТЭЦ-5)”.

Kind of Activities to Be Invested: Production of electric and heat power.

Way of Investment Attraction: Attraction of credits.

Purpose: To increase the output of electric and heat power, to reduce fuel rate for sold electric and heat power.

Customers: The electric power is supplied into the wholesale market through Specialized Separate Division «ENERGORYNOK» of National Power Company «UKRENERGO». The shortage of electric power for Kharkiv Region exceeds 500 MW×h. The heat power is supplied to the wholesale buyer — State Enterprise «KHARKIV HEAT NETWORKS». The shortage of heat power for Kharkov totals 900 Gkal

Competition: The electric and heat powers are competitive products in case of their combined production. At present, the heat power market competitors are heating boiler houses of «KHARKIV HEAT NETWORKS» and «KHARKIVENERGO». In Kharkiv Region Kharkiv Heating And Power Plant 5 (ТЭЦ-5) produces 25% of electric and heat power.

Design Capacity: Electric power: 2800 mill. kW×h (US $84.0 mill.)

Heat power: 1500 thou. Gkal (US $9.15 mill.).

Investment Volume: US $400,000 thou., including US $154,000 thou. Ukrainian Party contribution.

Structure of Investment Expenditures (US $ thou.):

• Development of Project: US $8 mill.
• Ordering of equipment: US $98 mill.
• Mounting of equipment: US $115 mill.
• Other expenditures: US $25 mill.

Additional conditions: Expected term of investments repayment: 16.4 years. The output of the produced electric and heat powers depends on the quantity of the supplied gas. The demand for electric power exceeds its supplies. The heat consumption is determined by the wholesale buyer.

Availability of Resources:

• production areas: 100%, on agreement with Investor,
• power resources: 100%,
• raw materials,
• semifinished products,
• components: 0%,
• technology: 0%,
• transport facilities: 100%,
• licenses: 0%,
• labor force: 100%,
• communication: 100%.

Payback Warranty: Pledge, bank guarantee, insurance.

Project Development Stage: Proposal for Project.

Other Information on Project: The introduction of 450 MW Steam And Gas Turbine-Generator Set (ПГУ-450) at HEATING AND POWER P1ANT 5 (ТЭЦ-5) shall provide the planned profitability 20%, fuel rate for production of electric power 230 g/kW×h, fuel rate for production of heat power 140 kg/Gkal. For the purpose of comparison with performance of the Project, it is necessary to point out that Zmiyiv State Regional Steam-Power Plant is characterized by fuel rate for production of electric power 360 g/kW×h and the independent boiler houses of «KHARKIV HEAT NETWORKS» are characterized by fuel rate for production of heat power 166 kg/Gkal.

Main Products: Electric and heat powers.

Turnover for Main Products: US $74,114 thou.

Fixed Assets: US $35,137.0 thou.

Authorized Capital: US $51,955.7 thou.

Output of Production in 1998:

• Electric power: US $62892 thou. (2047 mill. kW×h).
• Heat power: US $11222 thou. (1942 thou. Goal).

Special Properties of Products, Licenses, Patents, Know-How: License of VR (Verkhovna Rada) No. 0115 for right to conduct business activities in production of electric power. Registration No. 661 dated 24.04.98.

Main Products: Electric and heat powers.

Customers:

• Electric power: Specialized Separate Division «ENERGORYNOK» of National Power Com­pany «UKRENERGO».
• Heat power: State Enterprise «KHARKIV HEAT NETWORKS»

Competition in Kharkiv Region: 

• Electric power: Zmiyiv State Regional Steam-Power Plant (75% of market).
• Heat power: State Enterprise «KHARKIV HEAT NETWORKS» and «KHARKIVTEPLOENERGO» 75% of market).

Other information:

Foundation year: 1979.

Foreign participation: Unavailable.

Number of employees: 1015

• Main personnel: 922.
• Engineers: 125.
• Non-production personnel: 93.
• Chief officers: 18.

Form of Ownership: State type.

Organizational and legal form: State Enterprise subordinated to Ministry of Power Engineering of Ukraine.

Stage of Privatization: The Enterprise is not privatized.

Share of State Ownership: 100%.

Divisions: Unavailable.