News digest

Algeria: SNC Lavalin has awarded Alstom an order worth around g1.4m ($1.7m) to supply the Alstom ALSPA P320 Decentralized Control System for its 880 MW CCGT power plant located at Skikda.

Bulgaria: The Bulgarian Privatization Agency moved the deadline for the sell-off of seven electricity distribution companies to July 9 from 25 June after potential buyers requested more time to carry out due diligence for the three available packages.

Iraq: Washington Group International announced that it and its subcontractors are now employing more than 1000 Iraqi citizens to help rebuild Iraq’s electrical, water and other critical infrastructure. Washington Group has been awarded four major contracts in the region by the Program Mangement Office of the Coalition Provisional Authority and the Army Corps of Engineers.

Jordan: The $300m Jordanian Gas Transportation Pipeline project is expected to achieve financial close shortly. The project is part of a regional pipeline project that aims to transport gas from Egypt to Jordan, Syria, Lebanon and beyond.

Namibia: Namibia is undertaking a feasibility study into the possible construction of a $950m combined cycle gas turbine plant located at Oranjemund, around 800 km from Windhoek. The plant would be rated between 800 and 1600 MW and would use gas from the Kudu gas fields.

Romania: Five foreign companies have shown interest in the privatization of Romanian power distribution companies Electrica Oltenia and Electrica Moldova, said the country’s trade minister. These are AES of the US, Greece’s Public Power Corporation, Germany’s E.ON, Union Fenosa Intenational of Spain and Czech firm CEZ.

Slovakia: Slovakia is to sell the state’s remaining shares in west Slovakian power distributor Zapadoslovenska Energetika. E.ON is expected to bid for the 41 per cent of the company that is to be sold to a strategic investor with a further ten per cent to be sold to the capital market.

Turkey: The Turkish government is planning to launch tenders to sell power distribution companies in five or six regions in October 2004 as part of its privatization process. Privatization of power generation facilities is scheduled to begin in a year’s time.

UAE: Areva’s Transmission and Distribution division has been awarded a g70m ($85m) contract from the United Arab Emirates’ Ministry of Electricity and Water for the design and installation of a new high voltage substation in Dhaid to enable interconnection between the various Emirates’ power grids.

Nigeria approves funding for five new power plants

Nigeria’s federal government has given its approval to funding of around N25.1bn ($188m) out of the 2004 budget towards an investment programme that will see five new power plants constructed across the country.

Liyel Imoke, Nigeria’s minister for power and steel said, “We expect in the next two to three years we should see over 1400 MW of new capacity into the national grid”.

Projects each costing $148m are planned for Papalanto in Ogun State and Omotosha Ondo in Ada Abia State.

Most of the finance for these projects has been secured through the Exim Bank of China with Nigeria’s federal government providing the down payment of 35 per cent of the value of the contract.

The credit facility is to be repaid in instalments over a 12-year period.

The 414 MW Ajaokuta project is expected to cost $237m with Alaoji expecting to add 300-400 MW at a cost of about $148m. The 150 MW Ughelli project will cost $54m.

The addition of the new power plants by 2007 will enable Nigeria to narrow the gap between the demand for electricity, which is currently estimated at about 5000 MW, and the current peak capacity of 4000 MW.

Irish to transform Kosovo Energy

ESB International (ESBI), a subsidiary of Ireland’s national electric utility ESB, has won a UN-sponsored contract to restructure the Kosovo Energy Corp. (KEK). The contract is valued at g3.7m ($4.5m) and ESBI will be supported by its subcontractors TSI/Eskom of South Africa and Vattenfall Europe.

The contract is seen by the UN Mission in Kosova (UNMIK), which currently controls KEK through the Kosova Trust Agency, as a strategically important project for the development of Kosovo’s economy.

The contract includes everything from electricity generation to billing and even mining. ESBI will oversee KEK’s operations for an initial two-year period with the main objective being the transfer of managerial skills from the international team to local workers.

PB completes Nigeria study

Consulting firm PB Power has completed a nine-month study that will assist in the commercialization of Nigeria’s electricity system ahead of an eventual privatization.

PB Power was appointed by Nigeria’s Bureau of Public Enterprises (BPE) to identify what additional equipment would be required in order to promote electricity trading between the various components of the country’s electricity supply network, which is owned by the national Electric Power Authority (NEPA).

PB Power’s role included the preparation of documentation and specifications to enable NEPA to procure equipment needed as well as NEPA staff training. An earlier project also carried out by PB Power, alongside PricewaterhouseCoopers had valued NEPA’s assets and estimated the future expenditure needed for expansion of the power system to support the growth in electricity demand.

Russian genco sale plan approved

The Russian government approved in June a plan for selling wholesale electricity generating companies at special cash auctions, although the price for shares in the gencos has yet been decided. However, prime minister Mikhail Fradkov is reported not to have signed the decree and is seeking more fine-tuning, leaving progress in the country’s reform process uncertain.

Under the reform process, ten wholesale gencos will be created from the existing federal power plants currently operated by national utility RAO UES. The six thermal gencos will be sold to private investors at auctions, while the hydroelectric gencos will remain under government control.

It is also unclear whether the country’s hydro plants will be bundled together into a single company or into four companies as originally planned. The government is reported to be studying the issue.

Bulgaria resumes nuclear project

Bulgaria has announced plans to complete the construction of its second nuclear power plant on the river Danube. The prime minister, Simeon Saxe-Coberg, said the Belene development would help maintain Bulgaria’s position as the leading exporter of electricity in the region.

Construction of the plant originally started in the late 1980s but stalled in the 1990s. A feasibility study is due shortly and five companies have submitted offers to complete construction of the facility: Skoda of the Czech Republic, US-based Westinghouse, Russia’s AtomStroyExport, France’s Framatome, and Canada’s Atomic Energy. Preliminary estimates are that the cost of the project will be $2bn.

Bulgaria closed down two units at its Kozloduy nuclear plant in 2002 after they were declared unsafe by the EU.