MoU signed for Shirvan power plant

31 May 2002

A local/Japanese team has signed a preliminary agreement for the development of a new power plant on build-operate-transfer (BOT) basis. It is the latest in a series of BOT power schemes under discussion (MEED 26:4:02).

A partnership of Iran Power Plant Projects Management Company (Mapna) and Japan's Sumitomo Corporationon 22 May signed a memorandum of understanding (MoU) for the fifth local BOT power project, the 1,000-MW combined cycle Shirvan plant, which will be located in Khorassan province. The client is Iran Power Development Company (IPDC), the company in charge of Iran's private power programme.

IPDC had initially planned to tender the project in May, but revised its plans following the unsolicited submission of a proposal by the local/Japanese consortium earlier this year. The estimated Eur 600 million ($557 million) plant is the fifth BOT project undertaken by IPDC.

IPDC recently added a sixth scheme to its private power programme, a new open cycle station to be located in South Isfahan. The company signed an MoU with Mapna in late April to carry out the construction of the 600-MW plant, which may be turned into a combined cycle station at a later stage.

Mapna, through its Dubai-registered affiliate Mapna International, also has a 30 per cent stake in the project to develop the 1,000-MW combined cycle Parehsar station, Iran's first BOT scheme. The partners in the project are Italy's Sondel, which holds a 50 per cent stake, and Germany's Dillinger Stahl (DSD)at 20 per cent.

WestLBand Mediobancaare joint advisers on the scheme (MEED 25:1:02).

Negotiations are ongoing between IPDC and Saudi investors Xenel Industriesand Saudi Ogerabout the development of another two BOT projects. The Saudi Oger-led consortium, which comprises a major European developer and Japan's Nissho Iwai, is pressing ahead with negotiations for the 1,000-MW Ali Abad combined cycle station.

Xenel is negotiating to reach a final agreement in October for the construction of a 1,000-MW combined cycle station in Tabriz.

On another scheme, negotiations about a final agreement for the advisory mandate for the combined cycle, 1,000-MW Jalal power plant are ongoing between IPDC and ABB Financial Services (MEED 26:4:02).

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