Armenian Grids seeks $38 Mln from JBIC

Armenian Grids seeks $38 Mln from JBIC

June 21 2004

Yerevan. (Interfax) – Armenian Grids expects to sign an agreement with
Japan Bank for International Cooperation (JBIC) later this month for
a loan worth $38 million to finance energy projects, company General
Director Yevgeny Gladunchik said Friday.

He said $30 million would be used to reconstruct low-voltage power
plants acquired during privatization and $8 million would be used to
buy and install 150,000 electric meters.

JBIC representatives will visit Yerevan June 21 – 28. Gladunchik said
the loan would be used by the end of 2006.

The Armenian government and JBIC signed a loan agreement in 1999 to
finance the reconstruction of 33 power substations. The money was
never received because Armenia began privatizing its power grids.

The loan will be used to modernize just 30 substations since prices
for energy equipment have risen substantially in the past five years,
he said.

Armenian Grids must pay $2 million on the loan each year. The loan
will be provided for 30 years at 1.8% annually. Britain’s Midland
Resources Holding Ltd bought 100% of Armenian Grids for $12.15 million
in November 2002.