Saturday, February 1 2014

The Vorotan Hydro Cascade brought sustainable profit to the state budget of Armenia and the decision on the sale of the Cascade was inexpedient, Armenak Dovlatyan, Head of the Green Party of Armenia, said at a press conference on Saturday.  

According to Dovlatyan's estimations, the annual turnover of the Cascade is 95 mln USD, with 50 mln USD of it being the profit. So, the 70 mln USD needed for modernization of the Cascade would totally have paid off if the Government had allocated those funds. One more problem is the problem of drinking water. "It is obvious that the world will face a serious shortage of drinking water in the near future. In this light, we wonder who and how will dispose of the immense water resources of the River Vorotan. I suppose that the US, which has bought the Vorotan Hydro Cascade has extensive plans on the use of the Vorotan water resources", said Dovlatyan. He added that the Government should give an intelligible answer to this important question. 

In the meantime, Dovlatyan considers this deal noteworthy because it is the first large project being implemented by the United States, not Russia.  
Khachatur Marozyan, Head of the International Association of Lawyers and Psychologists, thinks that anyone having at least a slight idea of business, knows that assets should be developed, not sold. He thinks that the primitive decisions taken by the Government, including the one on the sale of the Vorotan Hydro Cascade, demonstrate that Armenian officials lack state thinking.    

Earlier ArmInfo reported that on January 29 ContourGlobal and the Government of Armenia announced that they signed an agreement for ContourGlobal to purchase and modernize the Vorotan Hydro Cascade, a series of three hydroelectric power plants totaling 405 MW on the Vorotan River in southern Armenia, for a purchase price of $180 million USD. Under the terms of the agreement, ContourGlobal Hydro Cascade, a direct and wholly owned subsidiary of ContourGlobal, will own and operate the three hydroelectric facilities located on the Vorotan river and will supply power to the Armenian grid under a long-term power purchase agreement. ContourGlobal will also invest $70 million over the next six years in a refurbishment program to modernize the plants and improve their operational performance, safety, reliability, and efficiency. ContourGlobal expects the modernization to create 150 near-term jobs in addition to the 150 long-term technicians employed at the plants. The Vorotan Hydro Cascade is one of the largest and most flexible power generating facilities in Armenia and the Caucuses.

This acquisition represents the largest single U.S.  private investment in Armenia's history and the first U.S. investment in Armenia's energy sector. The Vorotan Hydro Cascade accounts for roughly 15 percent of the installed capacity of Armenia's electricity system and provides sufficient energy to power 250,000 homes. ContourGlobal is a New York based international power-generation company with approximately 3,500 MW in operations or under construction in 17 countries and on four continents.  ContourGlobal's 1,650 employees manage, own and operate a portfolio of 33 power plants utilizing a wide range of fuel types and technologies including renewable energy production based upon Hydro, wind, solar and biomass, as well as an extensive fleet of conventionally powered thermal power plants. In the wider Eastern Europe area, ContourGlobal currently owns and operates approximately 1100 MW of power generation businesses in Bulgaria, Ukraine, Romania, and Poland.