Azerbaijan to assess expediency of attracting foreign loan for project

Business Materials 26 February 2013 16:09 (UTC +04:00)

Azerbaijan, Baku, 26 Feb. / Trend I.Khalilova /

Azerbaijan's national water operator (Azersu JSC) is preparing to submit to the Cabinet of Ministers the final credit agreement for the renovation and expansion of the water supply and sewerage system of the city of Khirdalan. The Saudi Fund for Development plans to allocate $35 million for funding the project, the government informed Trend.

"Prior to this we must receive reviews from ministries of economic development and finance," the government spokesperson said.

Preliminary work provided under the project was discussed during the recent visit of the Azerbaijani delegation to Riyadh which took place on February 11-15, resulting in the signing of the protocol.

The total project cost is estimated at $75 million, 47 per cent of which is planned to be financed through a loan from the Saudi Fund. Credit resources are offered for a period of 20 years with a grace period of five years and a rate of two per cent per annum.
"Given that the development of the project along with the Saudi Fund for Development has begun prior to the announcement of conservative policies for attraction of foreign loans by Azerbaijan, the negotiations with the financial institution continued.

"However, the final decision on implementation of this project through the loan provided by the Saudi Fund will be made after submission of all documents. Depending on the validity of the loan, the administration of the president may authorise the credit agreement with the Fund," the government said.The project will start in the second half of 2013.

The project provides for creation of a water supply network with a total length of 159 kilometres. Potable water will be supplied to the city from the Jeyranbatan complex of water treatment plants. Water will flow into the three new reservoirs (+82 Masazir, +120 Masazir and +118 Absheron) with a capacity of 20,000 cubic meters each and then in drift mode by the main line into the city.

Construction of the sewerage network in Khirdalan will begin following the commissioning of a new sewage collector. At present, waste water in Khirdalan is transferred to the Hovsan aeration station for treatment. In future, it will be transferred to the treatment plant with a capacity of 200,000 cubic meters per day which is under construction near the village of Lokbatan.

Construction of a tunnel type collector with a seven kilometres length from Khyrdalan to Khodzhasen has started for delivery of municipal wastewater in drift mode to the installation.

Construction works within the project are to be completed in late 2014. Implementation of the project will contribute to improvement of provision of services in the field of water supply and sewerage to over 100,000 residents of Khirdalan.