Iran plans international tender for two new nuclear power plants

Iran plans to issue an international tender for the construction of two new nuclear power plants in the coming months. Iran’s intentions were spelled out by Mohammad Sa’idi, the deputy director of the country’s Atomic Energy Agency, in a speech delivered to the World Nuclear Association (WNA) in London in September.

Sa’idi said that Iran’s Majlis bill called for the production of 20 000 MW of electricity from nuclear energy in the next 20 years. He said the construction contract from the two plants with total capacity of 2000 MW would be awarded taking into account both technical and security considerations. He added the bill envisioned using foreign investment.

In the past Iran has sought Russian help to build the Bushehr nuclear power plant. The Iranian delegation to the WNA meeting claimed that proposals to cooperate internationally on the new power plants indicated Iran’s peaceful and legal intentions regarding its nuclear programme.

Finance agreed for Jebel Ali ‘L’

South Korea’s Hyundai Engineering and Construction (HECC) has agreed a $325m muti-tranche funding facility with Arab Bank to build phase 2 of the Jebel Ali ‘L’ power and water station in Dubai.

HECC is the EPC contractor appointed by the Dubai Electricity and Water Authority (DEWA) and along with Italy’s Fisia Italimpianti, will be responsible for building the 1200 MW and 363m cubic litres desalinated water facility. The project is due to be completed in 2008.

Arab Bank is the sole arranger mandated for the $175m performance and advance guarantee facilities and the $150m import letter of credit and refinancing facility to support HECC’s performance obligation and procurement under the $696m EPC contract with DEWA.

Five compete for South African private power plant contracts

Five consortia including international energy companies have been shortlisted by South Africa’s minerals and energy department for build, own, operate (BOO) contracts for two gas fired power plants in Eastern Cape and KwaZulu-Natal provinces.

The two contracts are worth $1bn. The new plants will effectively break the monopoly on power generation enjoyed by Eskom in South Africa although Eskom has agreed to enter into exclusive 15-year agreements for the combined 1050 MW power output.

US based AES is part of a consortium including Tiso Energy and Lereko Energy, which is bidding for the contracts. The Inkanyezi consortium, which includes French group Suez and India’s Tata Power, is leading a group along with Standard Bank. International Power has teamed up with HSBC Bank and two African companies to bid and a fifth consortium is led by Malaysia’s YTL.

Privatization of Bahrain’s electricity industry gathers momentum

Bahrain’s Al Ezzel independent power plant project, signed in July, could be the first in a series of private projects and could lead to further privatization of electricity production and also of the country ports, according to Finance and National Economy Minister Abdulla Saif. The deal for Al Ezzel Independent Power Producer (IPP) in Hidd proves that privatization is a very viable option, he said.

Shaikh Ibrahim said Bahrain was continuing to expand its distribution network in anticipation of the extra electricity generated by the plant. “We have already awarded three contracts for new substations and are planning to award three more shortly,” he said.

Belgian-Gulf consortium Tractebel EGI and Gulf Investment Corporation (GIC) entered the contracts with the Bahrain government to design, build, own and operate the Al Ezzel IPPs.

Russian genset market volatile

A new report from researchers Frost & Sullivan shows that despite rapid growth in recent years, Russia’s $183.4m genset market remains highly volatile and risky. The report forecast that the market will grow to $353.7m by 2011 as Russia’s economy continues to grow, offering the potential for substantial profits.

Uncertainties surrounding the power reform process has prompted Russian industry to focus on future power prices and grid reliability, motivating companies to purchase their own genset.

Iraq exhausts power budget

Iraq’s new electricity minister Mohsen Shlash says the country’s 2005 budget for electricity projects has been used up and that he is in discussions with western donors to accelerate disbursement of their pledges in order to speed up reconstruction. Shlash said that the country’s strategy relies on donors financing an estimated $20bn worth of projects by 2010 in order to raise power capacity to 18 000 MW.

News digest

Armenia: The Japan Bank for International Cooperation, which financed the reconstruction of the Electricity Network of Armenia (ENA), has questioned the legality of a deal which transferred the rights to manage ENA to a Russian subsidiary of RAO UES.

Azerbaijan: Wärtsilä is to supply five gas fired power plants with a total output of 450 MW to Azerbaijan under a contract worth €30m ($36.8m). Construction of the first 80 MW plant is underway.

Czech Republic: A unit at the Temelin nuclear power plant close to the Czech Republic’s Austrian border faces a shutdown for renovation of its turbines following a number of malfunctions in the non-nuclear part of the facility.

Czech Republic: Power auctions undertaken by CEZ at the behest of the Czech energy regulator have resulted in a 14.3 per cent year on year increase in prices. Prices were driven up by traders’ expectation of profits from power exports.

Iraq: Prime Minister Ibrahim Ja’afari has opened the new 216 MW Baghdad South power plant. The new plant consists of two 108 MW gas turbine generators capable of burning residual fuel oil, supplied by the nearby Doura refinery.

Romania: Romanian utility Transelectrica will invest €900m ($1.1bn) in infrastructure improvements in the period to 2013 with funding coming from the EBRD and EIB as well as the company’s own resources.

Russia: Power utility Lenenergo is being divided up into four companies as part of Russia’s power reform process. Finland’s Fortum, which owns one third of Lenenergo, will receive three seats on the board of each company.

Russia: Russia is to lay an undersea high voltage interconnector costing $350m under the Baltic Sea capable of supplying 1000 MW generated by the Leningrad nuclear power station to Finland.

Saudi Arabia: The chairman of the Infrastructure Committee of the Jeddah Chamber of Commerce has forecast that Saudi Arabia will need to invest $10bn every year until 2025 in its power and water infrastructure.

UAE: Abu Dhabi’s publicly listed national power company Taqa has acquired 60 per cent of the shares in the Fujairah power plant run by Union Water and Electricity Company, which is scheduled to be privatized.

Ukraine: Delays in removing nuclear fuel from the Chernobyl nuclear power station are costing the country €15m ($18m) a year, a Ukrainian deputy minister has revealed. The minister also said that Ukraine would no longer use French firm Framatome for building a second storage facility.