Russia's UES board approves creation of third wholesale genco

Moscow (Platts)--29Nov2004

Russia's power monopoly UES has approved the creation of one more wholesale
generation company (WGC) and two more territorial generation companies (TGCs)
as part of Russia's power sector reform, UES said late Friday. The approval
included the creation of 6,096MW TGC-1, and of 2,362MW TGC-13, two of the
planned 14 territorial generation companies. The board also gave the go-ahead
for WGC-4 with the charter capital of Rb8.2-bil ($290-mil), whose creation is
to be completed in the first quarter of 2006. The 8,530MW WGC-4 is the third
of the six thermal generation companies that UES plans to approve before
year-end. WGC-5 and WGC-3 were endorsed earlier this fall. The wholesale
generation companies are being created as fully-owned subsidiaries of UES and
are subject to a subsequent privatization. But to dismay of potential
investors, energy and industry minister Viktor Khristenko said last week that
the sale of WGCs was not expected earlier than in 12-18 months, the time
necessary for the new companies to be completely set up.

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