Daily News Egypt

Government to re-negotiate implementation of Dairut, Nowais electricity projects - Daily News Egypt

Advertising Area

Advertising Area

Government to re-negotiate implementation of Dairut, Nowais electricity projects

Financial guarantee, arbitration will not impede contracts completion

The government is to resume negotiations to set up electricity power plants after agreeing upon some pending items in the contracts. The government also agreed to establish other plants that had been discussed earlier.

Mohamed Shaker, minister of electricity and renewable energy, said the ministry is about to complete the agreement and the signing of contracts for a number of projects. These projects are for the production of electricity through coal and solar energy and the combined cycle.

He told Daily News Egypt that the ministry approached concluding the contract of establishing Dairut power plant. The ministry approved the technical and financial aspects of the project and there are some legal provisions that need to be resolved. He continued that the financial guarantee and arbitration in case of dispute will not stop the implementation of the agreement with Acwa Power company.

The Ministry of Electricity seeks to produce 2,250 MW of Dairut power plant, which will be the first project of its kind that operates through BOO system (Build-Operation-Ownership). This system gives the land to investors through the usufruct system for 25 years. The investment in the project is estimated at about $2.1bn.

He added that the ministry will sign four agreements with Acwa Power to establish Dairut power plant, including the power purchase agreement, the supply of gas, the governmental guarantee, and the usufruct of land.

He mentioned that the Ministry of Electricity is in the final stages of completing the agreement with the Emirati company Al-Nowais to establish power plant operates by coal at a capacity of 2,640 MW in Oyoun Mousa Area. All technical and financial negotiations were completed. Contracts are currently under review.

The estimated cost of the project is roughly $4.5bn, and maritime quay that will receive the imported coal is a closed container in order to reduce emissions, in accordance with the environmental requirements of the World Bank, the Ministry of Electricity and New and Renewable Energy, which signed a memorandum of understanding with Al-Nowais company in September 2014.

Shaker said that the Ministry of Electricity seeks to diversify production sources. The establishment of the coal station will take three to five years. “The first coal station will be connected to the national grid by 2020,” he added.

Shaker reveled that a number of companies have applied to sign up for the first phase of the solar energy-provision agreement for feed-in tariff projects. Once these companies conclude the project’s financial closing, the final contract to purchase energy will be signed.



Advertising Area

Breaking News

No current breaking news

Receive our daily newsletter