OSLO, Norway, June 27, 2002 (PRIMEZONE) -- Statkraft and Norfund have jointly established Statkraft Norfund Power Invest AS (SNPI), on 50/50 basis and with NOK 1 billion in start-up capital. The company's object is to invest in, develop and operate hydropower projects in emerging markets. The two partners have complementary competence. Statkraft has a great deal of experience in planning and operating hydropower plants in Norway and Asia, Norfund creates economic growth in developing countries by investing in private enterprises, and it has a great deal of international experience and competence.
"We are extremely pleased to have Norfund as our partner in this offensive international commitment," said Bard Mikkelsen, Chief Executive Officer of Statkraft. "With our competence in the field of hydroelectricity and their international experience, the foundation is laid for a company with considerable development potential in a world that is has an increasing demand of non-polluting, renewable energy."
"Energy is a precondition for development and there is a great need to produce more energy in developing counties," said Per Emil Lindoe, Managing Director of Norfund. In Norway, we have a high level of competence in the field of hydropower, and Statkraft is one of the major players that we are happy to co-operate with. I am convinced that the investments will generate positive development effects and at the same time provide good financial results."
New Opportunities for Norwegian Competence
Over the last few years, the Norwegian hydropower industry has experienced a reduction in the activity level and in investments. At the same time, the international hydropower market offers a lot of potential to players with competence and financial strength. The need for electric power in developing counties is rising sharply. New developments are needed and the ongoing de-regulations, changes in environmental demands and changes in market mechanisms create business opportunities for companies with competence in these fields. The growth in power production in developing counties is estimated at four-five per cent per annum through to the year 2020, which is more than twice the expected growth in the industrialized world.
Many existing energy companies recognize the need for technical upgrading and consolidation of ownership structures, and are open to possible take-overs. The Norwegian competence network, industrial companies and consultants alike can be employed and strengthened through SNPI's international efforts.
Environmentally Friendly Hydropower Plants
SNPI's business concept is to plan, develop and possible purchase environmentally friendly hydropower plants and operate these on a commercial basis. To start with, SNPI will concentrate on projects in Asia and Latin America.
Initially, the companies will each invest NOK 500 million in the company, and existing projects under the auspices of Statkraft International will be transferred to SNPI. The intention is that the company shall have a capital base of NOK 5 billion within four or five years. In the longer term, it is expected that the company will be listed on the stock exchange.
Arve Johnsen is Chairman of the Board of the new company and Christian Rynning-Tonnesen, Executive Vice President of Statkraft is Vice Chairman. Eistein Andresen, a graduate engineer with a wealth of experience in the power sector has been appointed Managing Director. Key people from Statkraft International and Norfund will join SNPI, which is operative from today.
Positive Development Through Profitable Operations
SNPI will prioritize projects with a good return and an acceptable risk. The company will exercise active ownership with stakes of at least 20-50 per cent in relevant energy projects. Projects that are not controversial from an environment point of view and with favorable development costs will be given priority. Initially, focus will be on Asia and Latin America, but other markets will also be considered.
Statkraft SF is Norway's largest hydropower company with about 12,000 MW installed capacity, more than 2,000 employees and more than 100 years' experience in developing and operating hydropower projects with what at any time is state-of-the-art technology. The company has a great deal of international experience and is currently operating two hydropower projects abroad, in Nepal and Laos respectively.
Norfund (Norwegian Development Fund for Developing Countries) creates jobs and capital in developing countries by investing in profitable private business activities in a range of fields. Together with Britain's CDC, Norfund owns Aureos Capital, a fund management company that has 80 employees in ten countries. Norfund and Aureos have helped create or manage companies in development counties that employ some 60,000 people.