Romanian state-controlled natural gas producer Romgaz (SNG) has officially terminated the contract for the development of the Iernut gas-fired power plant, signed in 2016, News.ro reported.

The contractor was the association Duro Felguera (Spain) - Romelectro (Romania).

The reason for terminating the contract is the non-execution, in time, of the contractual obligations by the contractor.

Initially scheduled for completion by the end of 2019, the plant is not yet ready, and Romgaz is currently estimating how much work is needed.

The Romanian gas company wants to complete the plant as quickly as possible. Romgaz hired the contractor to build a modern gas-fired plant for EUR 260 mln on the location of the Iernut power plant taken over from thermal power group Elcen in exchange for RON 658 mln (EUR 146 mln) worth of debt.

The main equipment and basic engineering were supposed to be provided by Duro Felguera, and Romelectro was supposed to take care of the construction - assembly works, the detailed engineering part, and the delivery of the auxiliary equipment.

Romgaz has planned investments of RON 15.69 billion (over EUR 3 bln) by 2025, mostly in offshore projects in the Black Sea. Of this amount, the company wants to invest RON 3.66 bln (EUR 730 mln) in electricity production at the Iernut and Mintia power plants, and renewable energy projects.

(Photo: Romgaz Facebook Page)

andrei@romania-insider.com