Wednesday, September 14 2016 18:20
Alexandr Avanesov

Armenian Prime Minister is cautious in the issue of new investor of Nairit plant 

Armenian Prime Minister is cautious in the issue of new investor of Nairit plant 

ArmInfo. Armenia's newly appointed Prime Minister Karen Karapetyan informed today at the parliament that in the nearest future he will meet with potential investors of Yerevan Nairit Plant.

According to him the government and he personally are concerned not over the investors' proposals but lack of any long-term 10-15 years forecast on prices for energy sources. Karapetyan stressed that the matter concerns the third or fourth attempt to make investments in the plant. And if there is no specific forecast the deal may become quite risky. However, if there are logical proposals from business community the issue maybe discussed. "I haven't gotten familiar with the details of the deal yet, we will discuss it in details", the Prime Minister stated.

To note it was earlier reported that Head of Armenian community in Slovakia Ashot Grigoryan has recently announced that his holding "EU Asia Business Finance Center" is ready to invest 20 mln USD and to up to 150 mln EUR in re-launch of production on Nairit plant. Nairit Plant has been idle since April 2010. Throughout six years the Armenian government responded to numerous appeals of the former employees that the plant will be re-launched as soon as investor is found. "EU Asia Business Finance Center" holding has an Iranian partner who is ready to provide gas for operation of the plant free of charge as an investment.  Holding is ready to pay 1EUR for operation of the plant for 5 years in case it is exempted from taxes for that period and its debts to state are canceled.

To note, at the moment the debts of Nairit Plant amount to 50 billion AMD (about 130 million USD).  The Plant's shares were given as security against the CIS InterStateBank's 70 mln USD loan provided in 2006 for 5 years - till late Dec 2011 - at 12.5% p.a. In 2006, 90% of Nairit Plant's shares were sold to Rhinoville Property Limited (UK). The latter owns an 89,999% stake in the plant, Armenian Ministry of Energy and Natural Resources - 4,496%, Gazprom Armenia CJSC (previously ArmRusgasprom) - 3,596%, and Yerevan Thermal Power Plant - 1,907%. In 2015 the World Bank conducted a financial and technical audit at Nairit Plant at the request of the Armenian Government. The WB considers the re- launch of the plant to be inexpedient because it will need at least $250 mln. But even if investors are found, the WB experts do not think the product will be competitive, because it will have a high prime cost. Most experts were saying that the results of the WB audit can be considered as recommendations to the Plant's bankruptcy process, which has in fact started.

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