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Azeri Ministry files a lawsuit on Barmek Azerbaijan

Politics Materials 30 June 2006 18:04
Azeri Ministry files a lawsuit on Barmek Azerbaijan

The Minster of Economic Development of Azerbaijan has filed a lawsuit at the Economic Court on International Disputes on Barmek Azerbaijan, which manage the Baku and Sumgayit energy network. The Ministry said that it was linked with the serious shortcomings fixed in the activities of the company. They were revealed during the inspection held by special commission, established by the Ministry of Economic Development at Barmek Azerbaijan to check up the implementation of liabilities set in the contract with the government.

Despite the commencement of the legal hearings the commission will continue the check-up. In accordance with the terms of the contract, starting from 2006, Barmek is committed to pay the charges for energy purchased from Azerenerji. Under the contract, on the first year of management Bakielektrishebeke should pay 50% of the energy charges, on the second year 55%, third 60%, fourth 75% and fifth 100%.

In accordance with the report of the company, in the first quarter the company purchased from Azerenerji in the amount worth 44.7m manats, while the collection from consumers totaled 22.8m manats. Barmek comes out with two proposals at the government on increase of energy tariffs and compensation of debts of the first category subscribers (strategic facilities) by the government.

Earliet the head of the commission, Mikayil Jabbarov, the Deputy Minister for Economic Development, stated We did not undertake a responsibility on increase of tariffs, as Barmek urges.

There are also disagreements on the amount of investments. The company stated the investments amount to $291m, whereas as of the governments calculations the investments are lower than this sum.

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