Enel Says Slovak Project at Risk as Expansion Costs Rise

Enel SpA (ENEL)’s nuclear power plant expansion in Slovakia is at risk unless the east European country’s government “quickly” approves a plan to increase financing for the project, the company’s Slovak unit said.

Works at two additional reactors at the Mochovce site operated by Enel’s Slovenske Elektrarne AS may be halted unless its owners agree to boost spending by 800 million euros ($1.03 billion), Jana Burdova, a spokeswoman for the company, in which Enel has 66 percent, said in an e-mailed statement today. The project’s “complexity and a need to meet the latest safety standards” boosted building costs.

The Slovak government, which holds the remaining stake in the utility, didn’t back higher spending plans at a shareholder meeting yesterday as it needs more information on the project, Economy Ministry spokesman Stanislav Jurikovic said by phone today.

Slovenske, based in the Slovak capital of Bratislava, has allotted 3 billion euros for the project, which is expected to be completed in 2015, making it the largest private investment in the country. The upgrade is part of Enel’s plan to boost generation capacity in the country, which is seeking to regain self-sufficiency in power production following the shutdown of Soviet-era reactors.

Italy’s Enel bought a majority stake in Slovenske from the Slovak government in 2004. The utility, whose net income rose 22 percent to 457 million euros in 2011, has stopped paying dividends to finance the expansion of the Mochovce site, where two reactors have been operational since late 1990s.

To contact the reporter on this story: Radoslav Tomek in Bratislava at rtomek@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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