Iraq’s Qaiwan Group is on schedule to commission the first phase of its Barzian power plant in the second quarter of 2016, according to executive board member Fehmi Konyar.

“We are expecting the first phase of the power plant to be commissioned in April or May,” Konyar said in an interview with MEED. “After it has been commissioned we will begin to discuss phase two with banks and contractors.”

The first phase of the Barzian power plant will be simple cycle facility with capacity to produce 442MW.

The second phase will convert the facility to a combined cycle power station, increasing its capacity to 662MW.

The project’s budget, including both phases, is $600m according to the project-tracking service MEED Projects.

Speaking to MEED, Konyar said that Qaiwan is planning a public tender process for the second phase of the project, but did not give details on when the tender is scheduled to be issued.

Turkish contractor Enka was selected as the engineering, procurement, and construction (EPC) contractor for the first phase of the project.

On 17 March Qaiwan announced that it had secured two loans worth a total of $105m to help fund the development of the Barzian power plant.

Deutsche Bank, has acted as the mandated lead arranger (MLA), structuring bank, and facility agent for an eight-year $75m buyer credit. The Dubai branch of Lebanon’s Bankmed acted as co-MLA and co-lender for the loan.

The deal is backed by Compagnie Française d’Assurance pour le Commerce Extérieur (Coface), which manages public export guarantees on behalf of the French state, acting as France’s Export Credit Agency.

US-based GE has also arranged a five-year, $30 million commercial loan.

“The cost of financing on the two loans arranged by Deutsche Bank and by GE is less than it would cost the region of Iraqi Kurdistan to borrow if it went to international markets,” said Fehmi Konyar.

Kurdistan was expected to make its debut on international capital markets in July 2015 with a $500m-$1bn sale of quasi-sovereign debt.

The debt sale was delayed and is still yet to take place.

In July 2015 Kurdistan was expected to pay 11-12 per cent a year to borrow for five years.