Romanian Railway Co. Doubles Losses

• Debts exceed 3 billion RON

Eight months through the year, State-run Romanian Railway Company SA (Caile Ferate Romane - CFR) landed 667 million RON in turnover, down by 11.8 per cent from the corresponding period of 2008. CFR officials told BURSA that losses incurred in the referenced period amounted to 509,155,212 RON, nearly double the 360,459,570 RON lost in the first eight months of 2008.

At the end of August 2009, CFR SA reported overall debts in the amount of 3,021,711,007 RON, of which 896,142,690 RON to the State and 2,063,819,094 RON to suppliers. "Our largest creditors are Electrica, Telecomunicatii CFR, Informatica Feroviara and Interventii Feroviare," CFR SA representatives mentioned.

Eight months through the year, CFR SA reported receivables in the amount of 756,510,288 RON. The company"s primary debtors are CFR Calatori (passenger railway transportation), CFR Marfa (freight railway transportation) and Grup Feroviar Roman (the Romanian Railway Group).

The management of CFR SA further told BURSA that the necessary budget for railway infrastructure investments needed this year had been defined at 1 billion RON, but the State had only allocated 170 million RON, equal to less than 20 per cent of the requirement.

• Campina - Predeal line, ready next year

The rehabilitation of the railway line between Bucharest and Simeria is one of CFR"s largest ongoing projects. The Bucharest - Campina sector (92 km) has been completed already. Works were performed between 2001 and 2005 for a total cost of 274 million EUR (200 million EUR from the European Investment Bank and 74 million EUR from the State). However, the rehabilitation of the Campina - Predeal sector (48 km) is still in progress. The overall value of the works is 308,694,768.44 EUR, of which 231,729,441 EUR from ISPA and 159,080,440.44 EUR from the State. The execution is scheduled to take three years (2007 - 2010).

The feasibility study for the Predeal - Brasov sector (27 km) was created by ISPCF in 2006 and is currently being reviewed by Italferr SpA. The financing for the creation of the technical design needs to be identified in 2010. The rehabilitation of the Brasov - Sighisoara sector (128.5 km) is in a similar situation, as the feasibility study was made by ISPCF SA in 2004 and reviewed by Italferr SpA in 2004. Preliminary design documents were defined earlier this year, whereas the technical design will be delivered by Italferr in 2010. The same is valid for the Sighisoara - Coslariu sector (98 km) and for the Coslariu - Simeria sector (70 km).

• Bucharest - Constanta railway rehabilitation, also in 2010

The rehabilitation of the Bucharest - Constanta railway is another major project currently executed by CFR SA. The project has been divided into three sectors: Bucharest North - Baneasa (already finalized in 2006 - 2008), Fetesti - Constanta (in progress, scheduled for 2006 - 2009) and Bucharest Baneasa - Fundulea, Fundulea - Lehliu - Fetesti (in progress, scheduled for 2007 - 2010). The cost of the first two sectors has been estimated at 508 million EUR, of which 234 million EUR is provided by JICA and 274 million EUR by the Government of Romania. The third sector has a planned cost of 370.1 million EUR, of which 231.7 million EUR from ISPA and 138.4 million EUR from the Government of Romania.

Other major investments of CFR SA include the installation of an electricity network on the Doaga - Tecuci - Barbosi sector, the setup of a dispatch centre to coordinate the operations of the Galati Railway Hub, the installation of an electricity network on the Piatra Olt - Podu Olt sector and the construction of the bridge at Gura Lotrului.