VERBUND: "Solving the Coal Question at the Negotiating Table"

1/18/2000Wien

“Draukraft has not gone back on its proposed amending of the coal supply contract with GKB,“ Mr. Johann Sereinig, Member of the VERBUND Board of Management and the Draukraft Supervisory Board, commented press reports pertaining to this matter.

According to Mr. Sereinig the companies involved are striving to find a solution for the problems around brown coal at the negotiating table.

As for now, the results of the ongoing negotiations remain to be seen; then the competent bodies in the companies will work on this subject.

The Board of Management of VERBUND pointed out again that the coal supply contracts with GKB cause annual losses of several hundred million Austrian shillings for Draukraft. In the past, the excessive charges for coal were compensated via the official electricity tariff. As the electricity markets have been liberalized, there is no such public pricing anymore. Now the losses are passed on immediately to VERBUND and Draukraft, its subsidiary.

On the basis of its obligations under the Stock Corporation Law the Board of Management of Draukraft is, therefore, forced to strive for bringing the contract into line with the new conditions in an appropriate way; even more so, as the losses incurred may assume a dimension threatening the company’s existence.

According to Mr. Sereinig, the Board of Management of Draukraft is aiming at a negotiated solution with GKB in the near future. A positive decision of the EU-Commission concerning the question of refunding the stranded costs for Voitsberg will also be of essential importance in this connection.