by David Stepanyan
Sale of the Vorotan Cascade of HPPs to U.S. was a reasonable effort to keep the economic and foreign political balance after accessing the CU, said Deputy Head of the Caucasus Institute Sergey Minasyan commenting on the above deal to ArmInfo.
As it was reported earlier on January 29, ContourGlobal and the Government of Armenia announced that they have 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. ContourGlobal will 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.
"I think, the given deal shows Yerevan's aspirations to preserve its economic and political contacts in the USA and the EU simultaneously accessing the CU. Consequently, the Government will further search ways to make a new agreement, a facilitated version of AA and DCFTA, with the EU at the same time implementing the road map of accession to the Customs Union. Armenia needs a document that would allow it to further integrate into Europe so that it does not run contrary to Moscow-led Eurasian projects," Minasyan concluded.
Vorotan Cascade of HPPs consists of three hydro-power plants with a total capacity of 404MW. The Cascade operates year-round thanks to its two reservoirs and helps regulating the frequencies of power exchange from Iran to Armenia and the vice versa. The designed capacity of the Cascade is 1.16 bln kWh electricity annually. Vorotan Cascade of HPPs CJSC was 100% state company under jurisdiction of the Ministry of Energy and Natural Resources of Armenia before the latest deal. The Vorotan Hydro Cascade is one of the largest and most flexible power generating facilities in Armenia and the Caucasus. It needs modernization and 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.