PRESOV, May 27th, 2010

The investment group Slavia Capital wants to invest in geothermal energy in the cadastre area of the village of Teriakovce near the city of Presov in eastern Slovakia. Chairman of Slavia Capital Board of Directors Peter Gabalec signed Thursday a Memorandum of Understanding with Presov Mayor Pavel Hagyari and Mayor of Teriakovce Miroslav Angelovic. Partners with their signatures agreed to proceed jointly in implementation of the project. Its goal is to make use of geothermal energy to generate electricity and heat, for free-time activities with the opportunity to build an aquapark and a salt spa that will support tourism in the region, as well as for agricultural purposes to heat greenhouses.

Investment manager at Slavia Capital Peter Kusnir said that the amount of investment costs of the whole project will be known only on the basis of results of a feasibility study, first estimations are around the amount of EUR 30 million. Costs for drilling wells for each thousand meters are estimated at approximately 1 million euros. Since this is an investment preserving the environment, Slavia Capital in cooperation with both self-governments wants to make use of the opportunity to receive non-returnable financial means from European Union funds. They want to obtain them in the first stage for drill wells and then for technologies and their assembly. The project does not rule out the possibility to invite a strategic investor at a later stage. The investment should bring the city of Presov more than 400 new jobs.

Slavia Capital is interested in a 40-year old test geological hole drilled in search of crude oil. According to its representatives, it should belong to SPP or the state. Two years ago the city of Presov carried out a technical and geological study that confirmed a rich source of warm mineral water with a temperature of 125 degrees of Celsius in a depth of about 3,000 meters. The water is salty which extends its usage to salt spas. Mr. Hagyari stated at the press conference that the city is willing to move exploration rights related to the territory to the investor as it does not currently have financial means for such activities. Lands, namely fields, around the drill hole are owned by private holders and the village of Teriakovce, which has 27 hectares of land close to the drill hole.