Pale District Heating

signed

Provision of a sovereign loan of up to EUR 7 million to the state of Bosnia and Herzegovina, to be on-lent to the Municipality of Pale (the "Municipality") through Republika Srpska ("RS") and to be implemented by the municipally-owned district heating company, Gradske Toplane Pale (the "Company"). EBRD's financing will be complemented by an investment grant in the amount of up to EUR 3 million from Switzerland's State Secretariat for Economic Affairs ("SECO"). The proceeds of the loan will be used to finance part of the modernisation programme for the district heating ("DH") system of the Municipality of Pale (the "Project"). The Project will consist of the following components: (i) the construction of a new boiler house with the acquisition of a 10MW biomass boiler, a 10MW back-up natural gas boiler and two 100 m3 heat accumulation tanks; (ii) the replacement of the existing pipeline network as well as the installation of a central seasonal storage and heat substations with monitoring and forecasting systems; and (iii) acquisition of relevant goods and equipment (chip shredder, tractor etc).