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Transelectrica to Accept the Terms of the Government of Georgia on Deoffshorization

The company Transelectrica, which plans to invest in the construction of a giant Khudoni Hydro Power Plant , will fulfill one of the conditions set by the Government of Georgia – to refuse registration in the offshore zone.
Despite the fact that the Indian company Transelectrica Limited  owns a  branch Transelectrica Georgia registered in Georgia, it is going to fulfill this condition, and refuse registration   in the offshore.

According to the Technical Director David Mirtskhulava, Transelectrica  is currently waiting for a response from the government, which must submit for consideration its own version of a Memorandum between the company and the Ministry of Energy.

Under one of the conditions,  electricity that will be produced by KhudoniHPP might  not be exported and be completely consumed inside  the country for 15 years.

“The state requires financial guarantees for USD  5 and 10 million on the 1st and 2nd stages of the project. We are willing to provide such guarantees; the only question is the timing. The state requires obtaining 5 000 000  guarantee after registering the land on which it is planned to build a hydroelectric power station, while we believe that it is better to do it after environment  impact assessment  study of the  project  is completed – this is due to the fact that conclusions about the environmental issues are crucial. If the conclusion is positive, it will mean that the project is given the green light as well asforeign banks that participate in financing the construction. As for the second, 10 million guarantee, it must be provided after permission to start construction work is given,”- said David Mirtskhulava.

With regard to long-term rates, then in his words, it will be possible after financial and investment side of the issue will be calculated together with the banks. Ministry of Energy of Georgia will be also involved in the process.

“In this regard, we offer the maximum flexibility and forward proposals from the Ministry of Energy” – he notes.

According to him, as soon as the work on the harmonization of all the documents is over, Transelectrica founders  will arrive in Georgia to  sign all contracts with the government. It is assumed that this could happen before the end of the year.

The company’s founders visited Georgia in March 2014. According to them, the company has extensive experience with implementing such large projects.

“We can  all assure that the project will be implemented with all the international standards. Work is proceeding on the standards established by the World Bank, so many well-known international organizations are involved in it, “- Mirtskhulava adds.
The company plans to invest USD  1.2 billion in the construction of  a giant KhudoniHPP.