11 december 2017

Central Asia news

Tajikistan raised $ 500 mln assisted by Raiffeisen Bank and Citibank to complete Rogun hydroelectric power station

19.09.2017 13:52 msk

Ferghana


Construction site of the Rogun dam
The National Bank of Tajikistan announced the successful debut and sale of government securities on the world market to complete construction of the country's main strategic site, the Rogun hydropower plant (HPP). As the National Bank reports, a working group from Tajikistan led by the first deputy chair of the National Bank, Jamoliddin Nuraliev, with the assistance of investment Raiffeisenbank and Citibank, took part in the road show with major global investors and successfully issued and soled government securities worth $ 500 mln to continue the construction of Rogun.

According to the country's regulator, investors from the US purchased 38 percent of the bonds, the UK 24 percent, from the EU countries 35 percent and about 3 percent investors from Asia. The yield of coupons on bonds is up to 7.125 percent per annum.

"After successful negotiations, bids for investors to purchase government bonds in Tajikistan increased to $ 4.5 bln, and the yield on coupons on bonds fell from 8 percent to 7.125 percent per annum. Along with the acquisition of bonds, international investors also expressed their readiness to establish mutually beneficial cooperation with the Republic of Tajikistan, using other ways of investing," the NBU reports.

The road show of government bonds of Tajikistan passed in London, Zurich, New York and Boston. According to the National Bank, during the event, the Tajik working group held talks with more than 300 representatives of major investment companies such as Goldman Sachs, Black Rock, Pimko, Morgan Stanley, Fidelity, Wellington Mentoring Group and JP Morgan.


First Deputy Chair of the National Bank of Tajikistan Jamoliddin Nuraliev presents Rogun's bonds to investors

To complete the Rogun HPP, Tajik authorities issued securities worth $ 1 bln. On 21 July, the Tajik parliament approved the government's proposal to introduce government securities to finance the energy sector, Ozodi Radio (the Tajik service of Radio Liberty) recalls. In total, the country's main energy project needs about $ 4.5 bln to complete its construction.

According to the Ministry of Finance, thanks to the sale of shares of the power plant among the Tajik population they could collect over $ 80 mln. The Tajik government allocated about two bln Tajik somoni ($ 227 mln) from the state budget to complete the Rogun HPP.

The construction of the hydropower station began in 1976 but frozen after the collapse of the Soviet Union. In 2004, Tajikistan signed an agreement with the Russian RUSAL to complete Rogun. But the parties did not agree on the issue of equity participation, as well as the height and type of the dam (RUSAL proposed to erect a concrete dam 285 meters high and Tajikistan - a 335 meters stone dam), and terminating the agreement in 2007. At the same time, Tajikistan announced the continuation of the construction of the HPP on its own.

Upon completion of the construction, the 6-unit Rogun HPP will have the world's highest dam and generate 13.1 billion kilowatt-hours of electricity per year. Tajikistan plans to solve the problem of power shortage in the country in the autumn-winter period by the introduction of the waterworks.

In 2016, the Government of Tajikistan agreed to construct Rogun with the Italian Salini Impregilo S.p.A. company, which is considered one of the most trustworthy companies in the world in the construction of hydroelectric facilities. The amount of the agreement was $ 3.9 billion, which will go for the design, procurement of equipment and construction of dams, tunnels, waterways and the engine room. At the end of 2018, the contractor promises to launch the first two units of the HPP. In total, the HPP construction will last 13-14 years.

Fergana News Agency