Monday, June 23 2014

 The only positive thing about privatization of the Vorotan Cascade of HPPs is investment of the U.S. capital in Armenia's energy system, Robert Kocharyan, the second president of Armenia, said in an interview with yerkir.am.

He said the most attractive element of energy generation in Armenia is sold on a very obscure scheme in circumvention of the effective law and neglecting the Parliament's views. "Inherently, the deal on sale of the Vorotahn HPPs resembles a sale of some old office furniture," the second president said. According to him, the contract on sale of the Vorotan HPPs is drafted very asymmetrically. It is not in favor of Armenia, as it leaves Armenia no chances in case of legal proceedings. 

"Obviously, such wrong deal will lead to an increase in the electricity rate in Armenia. Actually, the ordinary citizens will again suffer from the mistakes and greed of statesmen. There is an impression that the contract was drafted without participation of the Armenian party. It is not too late to revise or even disclaim that contract. The deal was so unlawful that the persons involved in it will be brought responsible one day.  It is just a matter of time!  Although, it is a very obscure deal also for the buyer,"  Kocharyan said.  Earlier, Head of the Public Services Regulatory Commission Robert Nazaryan said the license of the Vorotan Cascade of HPPs will be extended. He said that sales deal is not competed and with the issue of the license that process will be significantly speeded up. 
On 29 January 2014  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.

To issue the license (and recognize CountourGlobal as the owner) a closure act is required. However, a provision in the sales contact claims that each of the parties has a right to terminate the deal if it is not completed within 75 calendar days.  However, the Head of the Government Staff - Minister David Haroutiunyan said the parties have extended the deadline for completing the deal to meet the interests of the investor. 
Earlier, Deputy Minister of Energy and Natural Resources Areg Galstyan told reporters that the Government revises some provisions of the contract on sale of Vorotan Cascade of HPPs, but the deal will not be canceled.  He said that there are some technical issues that are being verifies by the parties.  However, he could not say if the American party has already provided the funds under the contract.