Czech power utility CEZ said it was looking into possible partnerships and synergies to increase production at its 1,260 megawatt coal-fired power plant in Bulgaria.

"This does not necessarily mean selling the thermal-power plant of Varna," the company, which provides electricity to more than 2 million households and businesses in Bulgaria, said on Monday.

CEZ said possible partnerships for Bulgaria's second-largest coal-fired thermal plan in the Black Sea city of Varna could include a vertical integration with a coal supplier.

The company also said in its statement that it planned to double investment to modernise its power grid in Bulgaria this year from last year's 94 million levs ($65 million).

CEZ did not give any other details about its plans for the Varna plant and the company was not immediately available for further comment.

Last year, CEZ contracted consultants WorleyParsons to oversee the construction of a planned 880 MW gas-fired unit at the Varna plant and was due to take a final investment decision in October. Since then, CEZ has not provided any updates on the project.

The new plant, estimated to cost 800 million euros, was to replace three ageing units at the Varna plant which should be closed by 2012 to meet stringent EU environmental norms.

CEZ took over the plant in 2006 after acquiring the power distribution grid in western Bulgaria, which includes the capital Sofia.

Reuters; Balkans.com