IRAN ISSUES ADDITIONAL 25-MLN-EURO CREDIT TO ARMENIA FOR NEW POWER LINE

Interfax
May 29 2012
Russia

Iran has issued Armenia an additional credit worth almost 25 million
euro to construct the third, 400 kW Iran-Armenia overhead power
transmission line, general director of Armenian state-owned CJSC
High-Voltage Power Lines (the project's client) Saak Abramyan told
Interfax.

The credit agreement has already been signed, and Armenia expects to
receive the funds in June, after which full-scale construction will
commence, he said.

According to the contract, the power line's construction should be
completed within 18 months of the credit's opening.

The project is slated to cost 107.9 million euro, 83.083 million
of which were provided by the Export Development Bank of Iran last
September. The Armenian government is supposed to co-finance the
remaining 24.817 million euro; however, it has turned to the Iranian
side for additional funding due to a lack of financial resources.

Another Iranian financial organization, which Abramyan declined to
name, will provide the additional funds. The credit will be issued
under similar terms - for a five-year period with a grace period
in the first two years at a rate of CIRR+1% (commercial interest
reference rate).

Armenia is obligated to pay back the credit with supplies of
electricity.

At present, the two countries are joined by two 220 kW power lines.

After the third line is commissioned, combined throughput capacity
will increase from its current 350 MW to 1,200 MW. In the context of
this project, there are also plans to build the 440/220 kW Noravan
electrical substation in Armenia's Gegharkunik region.