The ESB is investing about £40 million (€50.8 million) in a fibre-optic cable in advance of its bid for a third generation (3G) mobile licence.

The State company said it hoped to bid for a licence in partnership with an international mobile phone company.

The general manager of ESB Telecoms, Mr John McSweeney, said it had identified "two or three" potential partners, but declined to reveal who they were. However, no partnership would be formed until final details on the competition were released by the telecoms regulator, Ms Etain Doyle.

The managing director of the ESB's engineering and commercial business division, Mr Sean Wyse, said it had "fairly detailed discussions" with potential partners.

The ESB was confident it could use the "backbone" fibre system and retail outlets throughout the State to roll out a mobile service quickly, as required by Ms Doyle.

However, Mr Wyse said it would require "a lot of support" from a partner. If no partner was secured, he said the ESB would proceed with the construction of the fibre network anyway.

If the ESB secured a 3G licence, it anticipated revenues worth "hundreds of millions".

The fibre network, which will wrap around wires on the existing electricity system, could be used by other 3G licence holders in that scenario. The system used to develop a fibre of "48 core" strength anchored on the power network was developed by a British group, ALF Focas.

Mr McSweeney would not comment when asked whether the ESB had held discussions with the US group Motorola. In the mid-1990s, it bid unsuccessfully with Motorola for the second mobile phone licence won by Esat Digifone. That partnership was known as Unisource.