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  • Vorotan dam cascade

    Vestnik Kavkaza, Russia
    July 23 2014

    Vorotan dam cascade

    23 July 2014 - 12:51pm By Susanna Petrosyan, Yerevan. Exclusively for
    Vestnik Kavkaza


    Disputes over the legitimacy of the sale of Armenia's Vorotan dam
    cascade to U.S. company Contour Global Hydro Cascade (CGHC) continue
    in Armenia. The three-level dam cascade on the River Vorotan (Syunik
    Province) will have an output of 404.2MW, an average of 1.16 billion
    kilowatt hours annually. The Armenian government and CGHC signed a
    contract: the U.S. company will pay $180 million for the cascade in
    six years and $70 million of investments for its modernization. Any of
    the sides has the right to cancel the deal if they fail to implement
    it in 75 days.

    The deal was supposed to be signed in mid-April. Justice Minister
    Ovannes Manukyan said that the process was slow because the list of
    facilities for privatization needed clarifying. Absence of
    explanations provoked speculations about foreign influence. U.S.
    Ambassador to Armenia John A. Heffern warned Armenia about the
    consequences of refusing to sign the document. In his words, it would
    become a signal for Western investors. Realization of the document
    would, on the other hand, demonstrate the opportunities and potential
    of Armenia in making deals, proving the readiness of Armenia for major
    contracts.

    Grayr Manukyan, an economic columnist of 1in.am, is adamant that the
    real reason for the problems with the contract is pressure from the
    Kremlin. The latter, in his words, does not want the U.S. to
    strengthen its economic influence in Armenia.

    The key dispute is the legality of the deal, the cascade was sold
    without parliament's approval. The Vorotan cascade was not on the list
    of enterprises for privatization and the government skipped the
    parliamentary procedure when signing it. The vagueness of the deal is
    so obvious that two Armenian ex-presidents have spoken out against it.
    "By selling the Vorotan cascade, Armenia lost its sovereignty. It is
    nothing but a crime of the century," said Levon Ter-Petrosyan.
    According to Robert Kocharyan, the best energy asset of Armenia was
    being sold in a very dubious manner: "The people responsible for the
    sale will hardly have a chance to avoid responsibility. It is a very
    ambiguous acquisition for the purchaser too."

    Experts explain that the economic activation of the U.S. and interest
    of American business in strategic energy facilities of Armenia is a
    response to Armenia's plans to join the Eurasian Economic Union. The
    logic of foreign players is fair, it is aimed at preserving and
    expanding influence in Armenia. The only thing unclear is the logic of
    Yerevan. What interests do the Armenian authorities have?

    Alexander Karapetyan, an ex-member of the Energy Ministry, said that
    the government had decided to refrain from privatization of the
    Vorotan cascade, a regulator of the energy system, according to
    studies of experts in the 2000s. "If the facility operates to make
    profit, it will not regulate peaks and falls in the energy system
    properly. Its output depends on the needs of the system. It is the key
    facility of our system, it has great strategic value."

    In this case, the foreign political element does not serve Armenian
    interests, which require the Vorotan dam cascade to remain under state
    control.


    http://vestnikkavkaza.net/analysis/economy/58037.html

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