ELCEN, the state-owned company that produces the heat and hot water distributed in Bucharest, agreed yesterday to pay a small part of its debt to state-owned natural gas producer Romgaz, namely RON 6 million (EUR 1.3 million).

ELCEN’s total debt to Romgaz amounts to over EUR 71.6 million. The partial payment will cover the gas ELCEN needs this week to continue producing electricity and hot water. If Romgaz stops gas deliveries to ELCEN and the energy company halts production, then Bucharest’s residents who are connected to the public heating and water distribution system will no longer receive hot water.

ELCEN is currently in a difficult situation after RADET, the company that distributes heat and hot water in Bucharest, which is owned by the municipality, has announced its insolvency.

ELCEN, which has a lot of money to recover from RADET, has also filed for insolvency. ELCEN’s suppliers, of which Romgaz is one of the biggest, are worried that they will no longer be paid, which is why Romgaz announced on Monday that it would stop gas deliveries to ELCEN.

The partial payment was decided on Tuesday, in a meeting that took several hours, where Romgaz and ELCEN representatives participated. The measure, however, is valid only until next week.

editor@romania-insider.com