OREANDA-NEWS. October 23, 2009. The Azerbaijani government and Azerenerji OJC (national energy operator) have obtained next success in foreign financing for the construction of electric power station Canub nearby Ali-Bayramli (Shirvan) thermal station (capacity: 750 MW).

At the same time Canub’s capacity has been increased from 780 MW in compliance with the original plan up to 800 MW.

The Islamic Development Bank (IDB) reports that its Board of Directors considered and approved a USD 200 million loan for station’s construction within the framework of co-operation with Azerbaijan for period until 2012.

Originally the IDB was ready to extend a loan of up to USD 130 million but as a result, agreed to increase the loan sum up to USD 200 million requested by the Azerbaijani government.

Earlier Azerenerji indicated efficiency of the Canub project.

According to Azerenerji’s vice president Marlen Askerov, the cost of Canub construction will be less compared to other stations.

“We expect to put this station into operation until the end of 2010,” he said.

Initially commissioning of Canub to operate on both gas and black oil was scheduled for late 2009.

Within the project Azerenerjitikinti LLC signed a contract with General Electric (US) for 4 gas turbines and 4 generators.

American company GE is to implement the contract for 13 months. Canub LLC that was appointed responsible for the turnkey project is to sign contracts with some more known companies for equipment supplies within the turnkey project.

Azerenerji itself failed to raise in time a loan from foreign banks for the station, despite it received the Azerbaijani president’s consent on the occasion). The EUR300 million loan for 10-year period under governmental guarantee would cover 50% of the project cost.

Canub power plant to operate on both gas and black oil will be commissioned by the end of 2009. But the lending banks’ loan proposals had validity for restricted period for which Azerenerji “forgot to sign a loan agreement with them. Now the station can be financed only by Azerbijan State Budget 2009.

In parallel Azerenerji blocked the construction of the first private power station by South Korea’s KEPCO. This private station almost would not cede to Canub on its capacity.