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State to be Involved in KhudoniHPP Project

State to be Involved in Khudoni HPP Project

According to David Mirtskhulava, Technical Director at  Transelectrica Georgia, KhudonHPP construction will commence in spring 2016 and is scheduled to be completed in 2022.

He says a Memorandum with the government of Georgia was actually agreed late last year, when investors arrived in Georgia at the invitation of the Ministry of Energy. In Mirtskhulava’s words, the Memorandum envisages a purchase of electric power by the state for twelve months and the company’s refusal to register in the offshore. He says the Indian company Transelectrica Limited is ready to fulfill this condition, and refuse registration in the offshore, the company is likely to move to the Dutch investment. In this regard, the two sides have agreed.

He notes after signing the Memorandum, procedures will be strictly defined such as a re-review of the environmental impact assessment, also numerous research events were held. Afterwards a construction permit will be obtained and then construction will begin. According to Mirtskhulava, the state’s participation in the project is to be achieved, the company would welcome it, because such large projects is not possible without the state support. However, he notes that the state’s involvement in management will affect any project, the government’s share should be minoritial. The company agrees on the 20% state equity participation in the project.

Mirtskhulava explains , the state’s involvement is not envisaged in the Memorandum, in this case ownership structure will change while the Memorandum remains the same. He adds that equity issues will be resolved in the near future, Deputy Energy Minister Irakli Khmaladze also pledged to resolve the issue in the near future. As for the protest regarding the project, the project’s technical director says that the best world experience will be applied. General points of agreement will be found with the local population, – says Mirtskhulava and notes that no other project has been studied so thoroughly in the energy sector and in his opinion, this is how all projects should be studied. Mirtskhulava claims negotiations began last August and ended in December, during this period “Transelectrica” transferred a fee for the land to the region where the construction will be carried out.