IDB Submitted a Draft Credit Agreement within Financing Reconstruction of Mingachavir HPS

Business Materials 5 April 2007 18:17 (UTC +04:00)

Azerbaijan, Baku/ Trend , corr. I. Khalilova / The Azerbaijani Government is completing work on the project of a credit agreement for reconstruction of Phase II of the Mingachavir Hydroelectric Power Station, a source in the Azerbaijan Cabinet of Ministers told Trend today. The Board of the Islamic Development Bank (IDB) approved the project with a credit of $80 million in January 2007. After the technical aspects of the agreement have been clarified with IDB, domestic procedures to sign it will be commenced.

According to the draft credit agreement, IDB presents the credit for the term of 15 years, with the lax period of three years, at the interest rate at 5.95 %. The funds will be presented on a mechanism of "leasing". The total value of the project is estimated at $105 million, with $25 million coming from the State.

Works on the Mingachavir Hydroelectric Power Station within Phase I, were carried out as far back as the late 1990s. Financed by IDB and EBRD, generators and sub-stations were replaced along with the installation of an on-land control (operating) desk. On the whole, approximately $40 million was spent on those activities ($12.5 million granted by IDB and $21 million by EBRD).