Baku, Fineko/abc.az. Azerenerji OJSC (Azerbaijan state electric company) and Japanese Bank for International Cooperation (JBIC) have not got out of difficult situation formed following failure to choose the contractor for construction of the second combined cycle gas turbine at Severnaya hydropower electric station (the project is financed by a JBIC loan).

The Azerbaijani government informs that two attempts to conduct a tender procedure on contractor choice were cancelled, and the parties not only stopped their efforts but declined from co-operation prospects as all.

“At the same time liabilities for unspent JBIC loan finances keep accumulating. Both parties are ready to halt them, but JBIC standards do not stipulate such practice. Search of a way out of the form situation will be probably commissioned to the Ministry of Finance of Azerbaijan,” a government source said.

Earlier Bakhruz Sadikhov, deputy director of Azerenerji’s Department of Technical Solutions & Production said that in the near future they were going to announce the third tender to select contractor as the previous two ones gave no positive results. And if the third tender fails to choose the company to meet all the requirements, then Azerenerji will implement the project by itself. But the third tender has not been announced.

The problem with choice of the contractor in the second tender appeared after refusal of Mitsui/Huidai alliance to reduce cost of its bids for the construction and Azerenerji’s non-readiness to supply equipment for the project by itself.

Earlier within the tender it was disqualified the second tender participant (China’s CNEEC) because of lack of bank guarantee.

CNEEC requested $403 million for its services and Mitsui/Huidai $448 million.

In connection with no progress in choice of the contractor Azerenerji considered prospects of applying to JBIC with a proposal to stop its loan validity. Such a step would allow avoiding the payments for unused balance of allocated loan funds. Azerenerji offered to stop loan validity for uncertain period. At the same time neither the Azerbaijani party nor the Japanese party refused from co-operation with the loan.

Originally expenditures on Severnaya 2 plant were expected to be $306 million and it was planned to launch the 2nd plant project in the 3rd quarter of 2007. The 400 MW combined cycle power plant project will be financed from the JBIC credit of Y29.280 bn (over $275 million) for 40-year period with 10-year grace term under rate of 0.75% per annum.

The feasibility study of the project was made by alliance of consulting companies TEPSCO (Japan)-Enprima (Finland) in 2004. But project evaluation of $310 million does not cover real expenditures.

Today value of 1 kWh of generating capacity is $820-$830. In case with Severnaya 2 real value can range $328 million up to $332 million.

The tender was announced for engineering of four 220 KV power lines and a 220/110 KV substation, supply, construction and assembly works, testing, and commissioning. Construction period is 27 months. The tender is conducted on turn-key principle. Tender participation cost was AZN 900. Commissioning of the 2nd combined cycle power plant is scheduled for 2009.

13.08.2008 10:53