(Yicai) Nov. 1 -- Norinco International Cooperation intends to raise a maximum of CNY960 million (USD130 million) in a private placement of shares to finance the construction of a 125-megawatt photovoltaic power plant in Bosnia and Herzegovina, the Chinese construction engineering firm said yesterday.

Norinco plans to issue new shares to no more than 35 specific investors, the Beijing-based company said in its private placement financing proposal released yesterday.

CNY724 million (USD101.6 million) of the proceeds will go towards the solar power station, which will be located in the city of Stolac approximately 90 kilometers from Sarajevo, and the rest will be used to supplement working capital, it said.

The project will use the Build-Own-Operate model, Norinco said. Construction should take one year and the operation period is 25 years. The payback period, including the construction phase, is expected to be just under nine years.

Norinco first announced its intention to build a PV power station in the European country in May. At the time, it said the project would cost EUR110 million (USD120 million), which included EUR13 million (USD14.13 million) to buy an 80 percent stake in the solar project’s operator Aurora Solar and EUR96.86 million for engineering construction.

The European Union plans to phase out coal-fired power by 2030, Norinco said. This means that the renewable electricity generated by the solar plant will be in demand. Bosnia and Herzegovina also sell electricity to neighboring countries thanks to the interconnection of the European power grid, providing favorable market conditions.

Norinco has already built a wind power station with a capacity of 156 MW in Croatia, which generated 460 million kWh of electricity last year, according to the company's 2023 annual report.

Despite the news, Norinco’s share price [SHE:000065] closed down 1.9 percent at CNY10.09 (USD1.40) today.

Editor: Kim Taylor