ATHENS (Dow Jones)--State-controlled Greek electric company Public Power Corporation SA (PPC.AT) said Wednesday it aims to proceed with the construction of an 880 megawatt power in joint venture with a local steelmaker.
"The management of Halyvourgiki SA and Public Power Corporation SA have decided to propose to their boards of directors the approval of a draft memorandum of understanding for the construction and operation of an 880 megawatt natural-gas fired electricity generation unit," PPC said in a statement.
The MOU calls for the creation of a separate joint venture company which would be 51% owned by steelmaker Halyvourgiki, and 49% by PPC.
In form, the MOU closely resembles a similar, and highly controversial deal between PPC and Germany's RWE AG (RWE.XE) unveiled late last year and is expected to be voted on by the PPC board at its next meeting Jan. 29.
That deal calls for the construction of two 800MW power plants and the acquisition of two secondhand gas turbines, as well as joint initiatives in the natural gas and renewable energy sectors. It also foresees PPC taking a minority 49% stake.
The last point, namely PPC's minority interest, has generated strong opposition from the company's powerful labor union, Genop. The union sees the MOU with RWE as a step towards the further privatization of PPC and has previously moved to block its adoption.