TALLINN — Eesti Energia plans to start the construction of an enormous shale oil plant in Vaivara County near Narva in spring 2010.

Eesti Energia’s investment decision was made in summer 2009 and currently the construction site is being prepared for the construction to start in spring.

“We will shortly make a contract to deliver a new steam turbine for the new shale oil plant which is also one of the key elements of the new factory,” Marina Bachmann, a spokeswoman for Eesti Energia told Baltic Reports.

The oil plant will cost nearly three billion krooni (€191 million) and the state-owned Eesti Energia is willing to cover this investment from its own budget. The company is negotiating with banks for a loan to cover expenses. According to Bachmann, the new factory will consume 2.26 million metric tons of oil shale and will produce 75 million cubed meters of shale oil gas, which is used in electricity production.

By 2016, Eesti Energia plans to enlarge the plant to include the manufacture of liquid oils, which will be twice as valuable as the shale oil produced today. The plant then would consume 10 million tons of oil shale per year and produce 30,000 barrels of liquid fuels per day.

However, the enlargement of an enormous oil plant by 2016 would need 18.5 billion krooni (€1.2 billion), including the three billion krooni needed for constructing the plant.

“This investment decision will be made in 2012 and we will need additional investments for enlarging the oil plant,” Bachmann said.