Anonymous insiders from Elektroprivreda Bosne i Hercegovine revealed Strabag from Austria is seeking EUR 20.5 million for a hydropower project that essentially failed in 2016, Dnevni avaz wrote. News on the process initiated at the International Court of Arbitration in Brussels has been withheld for a while. At the same time, the utility based in Sarajevo wants even bigger damages from the former leader of the consortium responsible for the construction of Vranduk.
It’s been months since Strabag AG officially demanded to be compensated by one of Bosnia and Herzegovina’s three state-owned electricity producers and distributors, according to people with knowledge of the matter. Sources from public enterprise Elektroprivreda Bosne i Hercegovine dd told Dnevni avaz that the Austrian company claims BAM 40 million (EUR 21.5 million) in damages related to the failed Vranduk project.
The start of the process in Brussels at the International Court of Arbitration within the International Chamber of Commmerce was expected, but the news has been withheld, the report adds. EPBiH is said to be seeking EUR 30 million from the former leader of the consortium which was selected four years ago for the hydropower plant.
Works began in July 2016, but activity soon slowed and Strabag formally pulled out in July of the following year. The endeavor was valued at BAM 114 million. The main contractor, which included Končar – KET from Croatia as a junior partner, sunk the deal after EPBiH refused to provide an additional BAM 20 million.
The arbitration follows unsuccessful negotiations on a settlement. The article adds the utility with headquarters in Sarajevo was advised by its Austrian lawyers to be silent about the start of the process.
The media outlet said unnamed sources from the company told it both sides are currently filing documents and suggesting how to proceed. The main hearing will apparently be held at year-end.
EPBiH proposed to the European Bank for Reconstruction and Development in 2018 for Končar and Euro-asfalt to take over the job, but it was rejected. EBRD decided the site should be returned to its original state.