Capex for the Georgian section of BTK to exceed $ 160 million

Business Materials 24 February 2014 20:05 (UTC +04:00)

Baku, Azerbaijan, Feb. 24

By Emil Ismayilov - Trend:

In accordance with the project budget of Marabda-Kartsakhi LLC, which is the operator of the Georgian section construction of the Baku-Tbilisi-Kars (BTK) railway, the total volume of expenditures for the implementation of the project will make up $ 170 million in 2014.

The project on LLC`s budget for 2014 was reviewed during the meeting of the BTK Coordination Council held in Baku on Feb. 24.

The budget covers rehabilitation, reconstruction and construction works of Marabda-Tetritskarov and Chalka- Akhalkalaki railway sections; construction of Akhalkalaki station with consideration of creation of points for change of passenger and freight cars and cargo transshipment, construction of the Akhalkalaki railway station, Akhalkalaki- Kartsakhi railway section, technical and architectural construction supervision, and project expertise.

Capital expenditures of the company in the amount of $164.2 million dollars are planned for this year, the project states.

Over $156.83 million (95.51 percent) out of the total capital expenditure will be spent on construction work, more than $ 2.07 million for designing, more than $3.8 million - technical and copyright supervision, a little more $868,000 - on project expertise , $ 273,740 - funding of the measures for construction provided by the legislation, about $ 306,000 - expenditures for independent expert, as well as $ 33.400 provided for other expenses.

Earlier, the head of Azeryolservis JSC (road transport infrastructure) of the Azerbaijani Ministry of Transport, Javid Gurbanov said that the completion of the construction of the Baku-Tbilisi-Kars (BTK) railway, which will connect Azerbaijan and Turkey will be possible by mid-2015.

In total, as part of the construction of the Baku-Tbilisi-Kars railway, the length of which will make up 180 kilometers, the work on 100 kilometers of the railroad tracks have already been completed. Furthermore, it is also planned to launch a test locomotive from Azerbaijan to the Georgian -Turkish border in late 2014 under the project.

Azerbaijan has allocated a $775 million preferential loan to Georgia for the construction and reconstruction of the Georgian section of the Baku-Tbilisi-Kars railway.Funding for this project from the State Oil Fund of Azerbaijan is carried out in accordance with a presidential decree on the 'Implementation of measures within Baku-Tbilisi-Kars project' dated Feb.21, 2007.

In accordance with the agreement signed between the Azerbaijani and Georgian governments, the funds have been transferred to Marabda-Kartsakhi Railway LLC through the International Bank of Azerbaijan. Marabda-Kartsakhi Railway LLC was created for designing, construction, rehabilitation, reconstruction and operation of the Marabda section - border with Turkey and relevant infrastructure facilities.

As of January 1, 2014, the State Oil Fund (SOFAR) has allocated $464.1 million to the BTK project.

Some $32.7 million was allocated from SOFAR for implementation of the project in 2013, compared to $ 151.5 million in 2012.

Some 132.311 million manat is scheduled to be allocated for the BTK project in accordance with the State Oil Fund budget for 2014.

Some $431.3 million was allocated until January 2013 for financing the project.

It is planned to construct a new 105 kilometer branch railway as part of the Baku-Tbilisi-Kars project. In addition, the section of the Akhalkalaki-Tbilisi-Marabda railway will be reconstructed in Georgia which will increase its capacity to 15 million tons of cargo per year. It is planned to build a center in Akhalkalaki for the transition of trains from the existing train tracks in Georgia to the European one.

Peak capacity of the corridor will be 17 million tons of cargo. This figure will be at the level of one million passengers and 6.5 million tons of cargo in the initial stages.

The official exchange rate for Feb. 24 is 0.7845 AZN / USD.

Translated by S.I.
Edited by C.N