METROPOLITAN Galaktion of Stara Zagora led a blessing of the waters and consecrated a symbolic key last Wednesday to launch what is said to be the largest power project in Bulgaria, the Bulgarian News Agency (BTA) reported.

National Electric Co-mpany (NEC) executive director Vassil Anastassov handed the key to Tom Ray, chief executive of Maritsa Iztok AD.

The ceremony was also attended by Prime Minister Simeon Saxe-Coburg, MPs and town mayors.

Four units of the Maritsa Iztok 3 thermal power plant with a total output capacity of 840 megawatts are to be rehabilitated and upgraded and to acquire de-sulphurising sections. The 580 million euro project is financed by ten banks in Europe, including four in Bulgaria.

The project is creating 500 jobs and involves the award of sub-contracts worth 150 million leva to Bulgarian companies.

"Bulgaria is the place for investors to be, right here and right now," said Geoffrey Roberts, President and CEO of Entergy Wholesale Opera-tions. US-based Entergy is among the project contractors.

Saxe-Coburg described the investment in the project as "particularly important for the national economy and a clear signal to international investors".

He said this was "the first large project of environmental importance meeting European standards and so important for the living and health of people in Bulgaria".

Asked by a reporter whether he expected another similar project to be launched this year, Saxe-Coburg said he was "pessimistic about it, considering the domestic economic situation".

In April 2002, Entergy and Italy's ENEL reached agreement on the financing of the rehabilitation project for Maritsa Iztok 3. The partners have formed a joint venture, Energiina Kompaniya Maritsa Iztok 3 AD, controlled by the NEC (27 per cent), ENEL (44 per cent) and Entergy (29 per cent).

After the project, coal supplies will be provided under long-term agreements with the Maritsa Iztok Mines and the entire output of the power plant will be sold to the NEC.

The chief contractor in the rehabilitation of the Maritsa Iztok 3 plant is a consortium between Germany's DSD Dillinger Stahlbau GmbH and RWE Industrie-Losungen GmbH. The project will be finalised in 3.5 years.

Of the project cost of 580 million euro, 348 million euro will be provided by Entergy and Enel and the banks. The European Bank for Reconstruction and Development is providing 112.1 million euro; France's Credit Agricole and Societe Generale, Italy's Midiocredito and Austria's Bank Austria Creditanstalt are providing 140.7 million euro; and the Black Sea Bank for Trade and Development 20 million euro. Bulgaria's Bulbank, United Bulgarian Bank, Biochim and SG Express are also participating in the financing with a total of 75 million euro. The International Investment Guarantee Agency (MIGA) is to provide political risk insurance to the foreign banks.

These are the first 580 million euro of a total of one billion euro investment expected this year in Bulgaria's energy sector. The rest of the money is expected to come from the privatisation of power distribution companies.