ArmInfo. Construction work on the Kap Reservoir in the Shirak Province has been suspended.
Early yesterday morning, a protest by construction workers took place at the reservoir construction site. The protest was prompted by the unilateral termination of the contract with the contractor, the Chinese company Shanxi Construction Investment Group, by the Territorial Development Fund of Armenia, the project's client. According to one of the construction workers, they received information about problems with the project's financing. As a result, dozens of people-drivers, construction workers, and support staff (approximately 100 people, according to them)-have been left without explanation. The relocation of residents of the village of Jradzor (the new village, located next to the reservoir, is planned to accommodate approximately 350 residents) has also been suspended.
Factor.am has learned that the Ministry of Territorial Administration and Infrastructure (MTAI) has begun the process of terminating the contract with the construction company. This information was confirmed by MTUI press secretary Sona Harutyunyan. "The contract termination process was initiated at the ministry's initiative. Contract deadlines were violated, and the planned work was not completed according to schedule. Currently, 16% of the work has been completed," Harutyunyan said in an interview with Factor. It's worth noting that the construction work was carried out by the Chinese company Shanxi Construction Investment Group.
Construction of the Kap Reservoir began in 1975 and was suspended due to the 1988 earthquake. The reservoir, with a design capacity of 110 million cubic meters, is located in the Shirak region, 22 km northwest of Gyumri, in the Akhuryan River valley. The reservoir's foundation stone was officially laid on May 18, 2023. The first phase of construction was scheduled for completion in April 2026. The first stage of the program plans to complete construction of the reservoir, which will have a capacity of 25 million cubic meters of water. The second stage is planned to increase the infrastructure to 60 million cubic meters.
The project includes the construction of auxiliary structures for the Kap Reservoir dam, equipping hydrological observation points on the Akhuryan River (from Lake Arpi to the Akhuryan Reservoir), constructing additional stations, and creating a centralized database (SCADA system). Completion of the dam and its auxiliary structures will primarily ensure the safety of downstream settlements and improve water supply to 12,325 hectares of land in the Shirak region and on the right bank of the Akhuryan Reservoir. It will also enable the replacement of mechanical irrigation with gravity irrigation on 2,280 hectares of land, saving 1.3 million kWh of electricity per year. Regular irrigation will increase agricultural production, and the installation of a reliable water metering system will improve water management and monitoring.
The project is financed by a KfW loan and co-financing from the Government of the Republic of Armenia. The total project budget is ?95.2 million, including ?68.5 million in borrowed funds. The loan agreement entered into force on June 29, 2019, with a final disbursement deadline of December 30, 2019, but was later extended to June 30, 2024. At the end of December 2024, the Cabinet of Ministers extended the period of access to these credit funds until December 30, 2026.
