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Azerenerji addresses to government on gross violation of contract liabilities by Barmek

Oil&Gas Materials 23 February 2006 18:51 (UTC +04:00)

In January Barmek Azerbaijan, the energy distribution company, transferred 10bn manats to Azernerji JSC instead of 62bn manats, Trend reports referring to a news release spread by Azerenerji. Every year Barmek reduces the amount of payment, envisaged in the contract.

According to Etibar Pirverdiyev, the President of Azerenerji, they addressed to the government in relation to gross violation of the contract liabilities by Barmek. Energy production costs 200 manats per unit, while it sold to Barmek for 71manats. Despite it, Barmek does not pay event 30 manats for received energy. It leads to crisis situation both at Azerenerji and the national energy system.

Non-payment of the sum by Barmek causes problems on disbursement of loans and their interest rates to international banks by Azerenerji. These funds were allocated for construction of new power stations and sub stations. Besides, the Company breaks up the program on internal investment and repair-preventive work, violate liabilities on transfer of funds to the public budget and evolve problems with payment of salary.

As a result of such acts Azerenerji may face with sanctions of banks, decrease of attractiveness. Other energy distribution company Bayva made a decision on cessation of activities in pari causa.

Husseyn Arabul, the head of Barmek, told Trend that from December to January the Company paid 24bn manats. The total transfer exceeded 62bn manats. Besides, in December 2005 Azerenerji carried out unsanctioned operation on mutual settlement. In accordance with the rule, Barmek receives funds from SOCAR for distributed energy and transfer them to the account of Azerenerji. Azerenerji transfers the funds back to SOCAR for the fuel, used at energy production. In December 2005 Barmek remained aside from this campaign. The same time SOCAR pays around 15bn manats to Barmek per month.

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