CET Palas Steam Power Plant in Constanta Transferred to the Public Assets
CITR, the leader of the restructuring and insolvency market in Romania, announced that the CET Palas steam power plant in Constanta, owned by Electrocentrale Constanta, has been transferred to public state assets, through the successful completion of the mechanism provided for in Emergency Ordinance no. 60/2019. This mechanism was the first such transfer in Romania. The asset’s transfer value is of RON 107.7 M, against the market value set in the insolvency procedure.
“The power plant transfer is a solution identified by the CITR team, as judicial administrator of Electrocentrale Constanta, in its mission to save the company’s activity by ensuring the continuity of production of hot water and heat carrier in the Municipality of Constanta. The transfer represents one of the pillars for restructuring Electrocentrale Constanta’s activity. The long-term strategy is to include CET Palas within an operationally and energy efficient SACET, able to self-support. This highly complex process was carried out with the support of the Constanta City Hall, the Ministry of Energy, and the Ministry of Public Finance, who provided a lot of involvement, openness, and a long-term vision,” said Florin Constantin, CITR Partner.
An industrial asset of interest for the national power system, the CET Palas power plant used to belong to Electrocentrale Constanta, one of the few economic operators in Romania that could meet the legal requirements on the transfer of such assets under the special provisions of Ordinance 60/2019.
“The mechanism involved the transfer of the CET Palas power plant to the property of the Romanian State and under the management of the Ministry of Energy, as well as the extinction of budget debts held in procedure by the Ministry of Public Finance. Today, the mechanism was completed through the transfer of the asset to the public holdings of UAT Constanta. Thus, the long-term strategy of integrating CET Palas into SACET Constanta has been achieved,” said Andreea Gaisteanu, Senior Insolvency Practitioner, CITR.
The process is closed by the approval of the Government Decision on transferring the asset from the State public holdings to the UAT Constanta’s public holdings, adopted on June 22nd, 2023.
About Electrocentrale Constanta
Electrocentrale Constanta became insolvent on 24.05.2019 because of the major losses along the thermal energy supply chain. CET Constanta’s main creditors are: S.N.G.N. Romgaz, S.N.T.G.N. Transgaz, RAJA Constanta, Tinmar Energy, Electrica Furnizare, Electrocentrale Bucuresti, and NAFA.
Societatea Electrocentrale Constanta is the only producer of thermal energy in the form of hot water (over 95%) necessary for heating and for the preparation of domestic hot water, which provides heat carrier for the centralized thermal energy supply system for consumers in the Municipality of Constanta. The company holds the CET Palas power plant, opened in 1970. The fuel used to produce thermal energy is natural gas.
Electrocentrale Constanta is a classified National Critical Infrastructure (NCI) and is under the special protection and regulation provided by GEO no. 98/2010 on the identification, designation, and protection of critical infrastructures.
The reorganization plan proposed by CITR for the insolvent company Electrocentrale Constanta was confirmed by the bankruptcy judge on September 27th, 2022, after having been approved by over 98% of the company’s creditors. The main restructuring pillar undertaken through the reorganizing plan was successfully completed by the implementation of the datio in solutum mechanism, ensuring in the long-term the commitment to maintain the supply of hot water and heat for the population of the Municipality of Constanta.
About CITR
CITR has been the insolvency and restructuration market leader in Romania ever since 2008. With an experience of over 22 years on the insolvency and restructuring market and over 1,100 projects managed over time, CITR is managing assets worth EUR 1 billion on a yearly basis and is distributing over EUR 100 million to creditors each year, in its mission to save the value of Romanian companies with an impact.
CITR is a company of Impetum Group, the first Romanian group dedicated to maximizing business value in each stage in a company’s life, with the aim of creating a positive impact on the economy.
