Operating Company to be Established for Construction of First Private Electric Station in Azerbaijan

Oil&Gas Materials 16 February 2008 14:49 (UTC +04:00)

Azerbaijan, Baku, 16 February /corr. Trend I.Khalilova / Azerbaijan Investment Company (AIC) JSC, in co-operation with South Korean Company of Kepko, began establishing an operating company to realize the project on construction of a private thermal electric power station in Alat settlement (near Baku), AIC Deputy Executive Director, Riad Gasimov, said. Currently the consultants are working on the charter of the company.

The consultants of Azerbaijani Economic Development Ministry on the project are BNP Paribas, Allen & Overy, MGB, Mott MacDonald which includes Azerbaijani juridical company McGregory. and Kepko's consultants include HSBC bank and juridical company Baker & McKenzy

"I think that the operating company will be registered by summer. The period of beginning construction of the station has been fixed for 30 June," Gasimov said.

According to him, currently the key talks between Kepko and Government of Azerbaijan focus on the sale of the electricity produced in the station.

"The closing decision will be made by the government. We think that this is a beneficial project and investors display an interest in it," Gasimov said.

Kepko proposes to construct the station for $720mln with 818 megawatt capacity which will operate on natural gas.

Construction and management of the station was proposed by the company on a 25-year term.

Should the parties reach an agreement, the electric station will be constructed within 3 - 3 years.

It will be the first private electric station with such a capacity in Azerbaijan.