ELE Endesa SA Ads

Endesa Will Invest Euro 1.4bn to Develop Various Energy Projects in Galicia in the Next Five Years Reganosa, a company in which Endesa holds a controlling stake and which is constructing a regasification terminal in Mugardos-Ferrol, signed a syndicated loan for Euro 416 million in Madrid today to finance this project. Among others, the plant will supply an 800MW combined cycle plant that Endesa is building in As Pontes. Both initiatives form part of Endesa's Capex Plan. BBVA and Caixa Galicia are the leaders of this financial operation, in which Banca Intesa, BNP, Cajamadrid, Caixanova, ICO and Royal Bank of Scotland are also taking part; Caixa Galicia is the credit agent. The loan is for Euro 370 million, which the group will use to construct the regasification plant at Mugardos and the gas pipeline network. An additional credit line will also be made available to cover the VAT charge on the investment - Euro 46 million - bringing the total loan to Euro 416 million. The financial consortium was selected through an international tender which Endesa's Finance Division helped Reganosa to organise. The tender attracted an enormous amount of interest, with 16 proposals being put forward. The main Euro 370 million credit will be structured as a 25-year project finance loan. This amount, plus the company's shareholders' equity, will be sufficient to construct the regasification plant and start commercial operations in early 2007. Reganosa was created specifically to build and operate the Mugardos-Ferrol regasification plant. Endesa holds a 21% stake in this company, in which Union FENOSA Gas, Sonatrach, the Tojeiro group, the Galician regional government and financial institutions Caixa Galicia, Banco Pastor and Caixanova also hold shares. The plant will have two 150,000m(3) LNG storage tanks. The outer shell of the tanks and the loading line have already been completed and the global execution of the project stands at 60%. In a year's time the terminal is scheduled to receive its first methane tanker to cool the tanks after which the test period will start. Commercial activity is slated to begin in the first quarter of 2007. When it reaches normal operating levels, Reganosa will supply the gas network with the equivalent of 8% of Spanish gas demand. A large part of the plant's regasification capacity will be used by Endesa to fuel an 800MW combined cycle plant to be built in As Pontes on top of the 1,400MW coal-fired plant which is already operating in this area. This coal-fired power plant is currently being transformed to use imported coal exclusively once the adjacent mine is closed down in 2008. In addition to these projects, Endesa plans to build a new coal terminal in Ferrol, with capacity to unload some five million tonnes of this fuel. A wind turbine factory will also be constructed in Ferrol and as part of the Group's extended wind farm plan (more than 800 additional MW). In total, Euro 1.4 billion will be invested in Galicia by the company over the next five years - the biggest investment package seen in this region in several decades. Today, Endesa has a large and diverse generation business in Galicia with 1,400 MW of thermal capacity, 438 MW of wind farm capacity and 376 MW of hydro capacity. Although the Reganosa project should revitalise the manufacturing framework of Galicia, it also has a national scope as it will mean a new entry point for gas in the Iberian peninsula which should help to create a more balanced Spanish gas system. It will also diversify gas supply in terms of where it comes from and who the suppliers are. * This document may contain certain forward-looking statements regarding anticipated financial and operating results and statistics that are subject to risks and uncertainties as well as to material risks, changes and other factors which may be difficult to predict, including, without limitation, those factors described in the Documento de Registro de Acciones of Endesa filed within the Comision Nacional del Mercado de Valores and in the Form 20-F of Endesa filed within the Securities and Exchange Commission, both for the fiscal year ended December 31, 2004. For all of these forward-looking statements, we claim the protection of the safe harbour for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.