DRMNO - China Engineering Machinery Corporation (CMEC) on Monday began assembling modern mining equipment at a mine here in order to increase its production for the Electric Power Industry of Serbia (EPS) in a project worth $123 million.

Serbian state officials and those from the Chinese embassy met at the Drmno mine, where representatives of EPS and CMEC signed a decision to begin works on installing equipment.

Serbian energy and mining minister Aleksandar Antic said at the signing ceremony that the beginning of the installation of the ECS (Excavator-Conveyor-Spreader) system would provide an additional three million metric tons of coal per year for the functioning of the new block unit at the Kostolac power plant, also being constructed by CMEC.

"By 2020, Serbia will get its first new block-unit energy facility that has the capacity of 350 megawatts, which will significantly influence our energetic security. The first precondition for us to use the new block unit is to have enough coal here in Drmno, and for this we need a modern ECS system that will increase the production of coal," Antic explained.

He concluded that the works at Drmno were important for Serbia and its whole energy system together with the construction of the new block unit because "this is the only way EPS can continue producing energy for the accelerated development of Serbia."

The project, to be completed in 47 months, foresees installation of an ECS system to the Drmno coal mine consisting of a rotary excavator, eight conveyors with 12 km-long conveyor system and a spreader with the capacity of 8,500 cubic meters per hour, as well as two new substations.

Acting general director of EPS, Milorad Grcic, estimated that "this day presents a beginning of new era for the municipality of Kostolac and the city of Pozarevac, and it's a guarantee for a bright future of this region."

He explained that ECS system was everything Drmno mine needed to increase production from nine to 12 million tons of coal, that it would pay off in five years while it would be in operation for the next 39 years, which would provide Serbia with necessary energy security.

"This system complies with the highest EU standards and environmental protection, and will provide an additional three million tons of coal per year. Completion of works should coincide with the completion of the new block with the capacity of 350 megawatts. Without this coal, our energy sector could not function," Grcic said.

Chinese ambassador to Serbia Li Manchang referred to the project as yet another achievement of the strategic partnership between Serbia and China.

The works on installing the ECS system are a part of the second section of the Kostolac B Power Plant project that has a total value of $715.6 million, 85 percent of which were provided by EXIM bank.

According to a CMEC statement, the new excavator will be installed by the end of the month, works on the conveyor will begin in February and once that is completed the company will proceed installing substations, a conveyor system, and other elements.