(MENAFN - Daily News Egypt) The withdrawal of companies from the feed-in tariff projects will not affect the programme, which aims to produce 1,995MW of solar energy, said Minister of Electricity Mohamed Shaker.
He told Daily News Egypt that the withdrawal of the funders from the first phase was the result of the companies' insistence on international arbitration, contrary to the determined site of the Cairo Regional Centre for International Commercial Arbitration.
He explained that it was agreed with the companies interested in continuing the project in the second phase that Paris would be the site for external arbitration, while Cairo will be set for local arbitration.
He said that investors who were able to complete the financial closing have signed contracts. He noted that offers are being examined by the Egyptian Electricity Transmission Company to ensure the health of the financial closure, adding that the Ministry of Finance will sign the agreement soon.
The list of companies that signed contracts include Scatec Solar, Infinity, Fas Energy, ARC for renewable energy, Mag engineering and contracting, and Elf Energy Egypt.
The nine companies that adhered to the first phase of the feed-in tariff projects must secure 85% of the project's cost from foreign banks and 15% from local banks. They also agreed to hold arbitration in Egypt.
According to the Ministry of Electricity controls, all companies that signed the power purchase agreement and submitted financial closure must complete a set of documents and proedures within 10 days, including obtaining the legal opinion and insuring the project.
As for the Dabaa nuclear power plant, Shaker said that they agreed with the Russian side to sign the final contract for the nuclear plant by the end of this year.
Russia will provide Egypt with a loan worth 25bn to finance equipments for construction and operation of the nuclear power plant in Dabaa.
Shaker said that Russia will grant Egypt the first tranche of the 25bn loan after signing the contracts.
He noted that they agreed with the Russian side to launch a training campaign for the station in April, and they will start training 1,711 people to work at the station.
He said that the first nuclear reactor at the Dabaa nuclear power plant will kick off nine years following the signing of the contracts; the second, six months after that; the third, one year from operating the first one; and the fourth, operating 12 months after the third kicks off.The loan will be used to finance 85% of the value of each contract of constructions, services, and equipment for the projects; while the remaining value will be financed locally.
The loan is for 13 years between 2016 until 2028, at an interest rate of 3% per annum.
Nuclear power is currently securing 17% of the world's electricity needs. Egypt's perfect strategy to provide electrical power to citizens and secure social and economic development is to rely on nuclear power backed by renewable energy sources such as solar, wind, biofuel, and geothermal heat.