Romania's Government will disburse another RON 97 million (EUR 20 mln) of state aid to the coal and power complex CE Hunedoara, currently under insolvency.

The company will use the money to finance the closure of two coal mines: Lonea and Lupeni, News.ro reported.

The state aid is part of a broader action taken by the Government and already notified to the European Commission, according to the documents.

Out of the total amount, RON 12.4 mln will cover the severance payments for the miners made redundant, RON 0.54 mln for the redundant miners' professional conversion, and the bulk of the money will be spent for closing the mines (RON 20 mln), rehabilitation of the former mines (RON 37 mln) and preparing the ground for cultivation (RON 27 mln).

Lonea and Lupeni mining perimeters are among the oldest in the Jiu Valley coal area, with an extensive mining structure on several exploitation levels (horizons).

CE Hunedoara owed RON 6.1 billion (EUR 1.3 bln) to its creditors in the fall of 2019 when it entered insolvency - mostly to other state-owned companies. Its revenues had plunged over the previous years, and the company entered a vicious circle after it was not able to pay for the CO2 certificates - which generated penalties and major cash flow problems. 

(Photo: Pixabay)

andrei@romania-insider.com