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ENRON GLOBAL POWER & PIPELINES ANNOUNCES
POLAND POWER PLANT AS A DESIGNATED DEVELOPMENT PROJECT
FOR IMMEDIATE RELEASE: Friday, May 16, 1997
HOUSTON -- Enron Global Power & Pipelines L.L.C. (Ticker symbol: EPP) today announced that Enron has identified a proposed 116-megawatt, natural gas-fired combined heat and power plant in Nowa Sarzyna, Poland, as a designated development project for EPP's project portfolio.
In April 1997, an Enron subsidiary, Elektrocieplownia Nowa Sarzyna Sp. z.o.o. (ENS), signed a 20-year power purchase agreement with the Polish Power Grid Company for the development of the facility, which has a capital cost of $120 million and will be located on the grounds of the Organika Sarzyna Chemical Works (OSCW). ENS will provide steam to OSCW and to the City of Nowa Sarzyna. Enron owns 97.5 percent of the project and JAC (Poland) Ltd., a Warsaw-based consulting firm, owns the remaining 2.5 percent.
"We are pleased that Enron is developing the first privately owned independent power project in Poland and we believe the plant would be a strong addition to our portfolio," said Rodney L. Gray, chairman and chief executive officer of EPP. "Construction of the facility is expected to begin in the fall of 1997 with commercial operation targeted for early 1999. We anticipate that Enron would offer EPP an interest in the facility shortly thereafter."
Under the Purchase Right Agreement that EPP has with Enron, designated development projects must be offered by Enron to EPP at prices which meet certain projected minimum earnings, cash flow and internal rate of return criteria. Two other designated development projects are a 478-megawatt power project in Turkey and phase one of the Dabhol power project in India, both of which are under construction.
As announced on Wednesday, May 14, Enron has submitted a formal merger proposal to the outside directors of the EPP board. They will appoint independent financial and legal advisers to assist in the evaluation of this proposal, and their evaluation is expected to take several weeks.
EPP's assets consist of interests in two power plants in the Philippines, one power plant in both Guatemala and the Dominican Republic and natural gas pipeline systems in both Argentina and Colombia.
Enron Global Power & Pipelines, majority owned by ENRON, is traded on the New York Stock Exchange under the ticker symbol, "EPP."
For additional information please contact:
Carol Hensley
(713) 853-6498
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