by David Stepanyan
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.
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 agreement was signed by the Armenian Minister of Energy and Natural Resources Armen Movsisyan, Garry Levesley, Executive Vice President and Regional CEO for ContourGlobal Eastern Europe and Director of Vorotan Hydro Cascade Sassoun Khachatryan in the presence of Armenian Prime Minister Tigran Sargsyan. Sargsyan expressed Armenia's interest in cooperation and new investment projects with the U.S. participation.
Garry Levesley, Executive Vice President and Regional CEO for ContourGlobal Eastern Europe, stated: "I am delighted to be signing this transaction on behalf of ContourGlobal today. I look forward to working closely with the Government of Armenia and its State Agencies on this critical project in the coming years. ContourGlobal has extensive knowledge and experience in operating in the region and looks forward to adding these significant power plants into our portfolio and making further improvements and investments in them."
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.