PM Đukanović speaks at ceremony of laying first metres of Italy-Montenegro undersea energy cable on Montenegrin side

Milo Đukanović, Prime Minister of Montenegro:
(Speech at the ceremony of laying the first metres of the undersea energy cable on the Montenegrin side of the Adriatic) 
Cape Jaz, 4 October 2016

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Ladies and gentlemen,

I want to welcome you on behalf of the Government of Montenegro and to express satisfaction with this very important event - the laying of the first metres of the undersea energy cable on the Montenegrin side of the Adriatic, which will link our country to Italy.

This event marks the new stage of the strategic project implemented by the Italian state company Terna and Montenegrin Transmission System (CGES). Italian side has already installed 136 km of the energy cable, which maximum length between Pescara in Italy and Cape Jaz is 455 km. Not far from here the CGES is building the Lastva substation and 400-kV Lastva-Čevo-Pljevlja transmission line. The total value of the entire project, which is planned to be completed by the end of 2018, is over EUR 800 million.

Within a few years, this project has been accepted as a strategic interest not only of our two countries, but also of the Western Balkans and the EU. It also plays a role of swift energy development generator in the region, which paves the way for new Trans-Balkan Corridor. It combines the interests of the Energy Community, as well as the countries of the Western Balkans. This is confirmed by the fact that the EU - Western Balkan Investment Framework supports this project with a EUR 25 million worth grant earmarked for the construction of 400 kV Pljevlja - Bajina Bašta interconnection.

The undersea energy cable is unique due to its exceptional technical challenges that we overcome successfully thanks to the professional reputation of our strategic partners, the Terna company. Works are carried out through the bottom of the Adriatic Sea at a depth which reaches up to 1200 metres, with direct current transmission nominal capacity of 1000 MW. Montenegrin Transmission System, which is majority owned by the state, in partnership with one of Europe's largest operators of electricity transmission, confirms the ability of local companies to participate in the implementation and such complex projects.

The benefits from the implementation of the undersea energy cable project, which will link Montenegro and the region with a strong and stable energy market of Italy and Europe, are already visible. This converter station from Lastva Grbaljska, to Cape Jaz where we are now, implies involvement of over 500 people and more than 30 local companies. During the most demanding phase of the project, over 200 people will be employed every day.

In addition to this section, there is a need for significant involvement of local labour force and construction operations at the construction of the Lastva substation and along a 4 KV transmission line from Lastva, via Cetinje, Nikšić, Šavnik, Žabljak and Pljevlja. It is expected that dozens of new highly skilled workers will be needed for maintaining the new part of the system.

After the link is commissioned, Montenegro will pearn significant revenues based  on the CGES's share in the total capacity of the cable - 20% of the installed 1,000 megawatts

Electricity transmission in the region through this direct interconnection will also make profits. Another benefit for Montenegro is that its electric power system will be directly linked to regional and European markets. By creating an integrated market for electricity and increasing competition, industry and citizens will be allowed to be supplied on the basis of lower wholesale energy prices.

This project will contribute not only to a greater openness of our power system, but also the economy as a whole. It is a confirmation that the optimum use of available resources is the most important condition of dynamic economic development, which will be easier achieved through the integration into the European single market in all sectors, including energy.

The implementation of the undersea energy cable project has given fresh momentum to decades-old idea of the exploitation of the Montenegrin energy potential. A few days ago, on 29 September, we signed a contract for the construction of the Block II of Pljevlja Thermal Power Plant. Construction of the Krnovo wind mill is in the final stage. Interest in Morača and Komarnica hydro power plants has been growing more intense. Those who are familiar with the situation in this sector think that the undersea energy cable represents a positive impulse to recently completed major energy facilities in Bosnia and Herzegovina (Stanari Thermal Power Plant) and Albania (Hydro Power Plant Banja). This illustrates the effectiveness of the EU enlargement to the Western Balkans, and also confirms the commitment of the countries of the region to future development based on respect for the highest European standards. It also enables Montenegro to become an energy tie between the Western Balkan states and EU.

In addition, the completion of these works will enable Montenegro to strengthen and modernise its transmission network in coastal areas, as well as in the northwestern part of the country.The first results are already visible. The project will enable a far greater level of security and reliability of supply, which is one of the key assumptions of current and future major investments in tourism. On the other hand, opening a new energy corridor in an area where there is significant untapped energy resources creates the preconditions for new large-scale investments in the energy sector. Successful harmonisation of these two development objectives will undoubtedly contribute to improving the quality of life of our people and the rapid achievement of European levels of development.

Thank you for your attention!