Azerbaijan, Baku, 31 October / Trend / Azerenergy Open Joint Stock Company (OJSC) and the Asian Development Bank (ADB) will sign a new cooperation plan in the field of power engineering by the end of 2008, Marlen Asgarov, the Vice-President of the OJSC, said.
According to Asgarov, cooperation plan between Azerenergy and the bank has been coordinated for five years and it will be realized in 2009. The plan was developed within the framework of the rehabilitation project of electricity transmission lines in Azerbaijan.
The project costs $240mln. A total of $160mln of this amount falls on loan of the ADB and Azerenergy will allocate the rest amount of means.
In September the Board of Directors of the Bank confirmed allocation of $160mln to realize this project. The project envisages construction of double circuit 220Kv transmission line from the Mingachevir Hydropower Station to the Absheron substation. Moreover, it is planned to unite 220/110kV substation with 110kV electricity transmission line.
The project targets to increase capability of electricity transmission systems and to reduce regional imbalance in the economic growth through adequate and reliable power supply, as well as to expand opportunities electricity transmission and to improve quality and reliability of power supply.
In July the Asian Bank held negotiations with the government of the country on loan agreement. In accordance with the agreement, loan will be issued to Azerbaijan for 25 years with 5-year grace period and libor+0.2% of interest rate.
It is expected that a loan agreement will be inked during the visit of Haruhiko Kuroda, the President of the Asian Development Bank (ADB) to Azerbaijan, scheduled for 20 November.
The Government cooperates with the ADB since 1999 and so far, the bank has issued loan by $304mln to the country under a state guarantee.