Attarat Power Company (APCO) announced last week that following the comprehensive negotiations conducted since early 2014, it has signed a 30-year Power Purchase Agreement and other project agreements with the Hashemite Kingdom of Jordan to construct a 554 MW (gross) oil shale fired power generation capacity in Jordan.
Attarat Power Company is indirectly owned by Enefit (Eesti Energia AS), YTL Power International Bhd of Malaysia and Near East Investments Limited of Jordan.
APCO has signed Power Purchase Agreement with NEPCO, Jordanian national electricity company, whose obligations are backed by the Hashemite Kingdom of Jordan. Term of the agreement is for 30 years from project financial close and NEPCO has a right to extend the term by additional 14 years. Power will be supplied at a very competitive levelised tariff that comprises of capacity and energy components and takes into account a royalty payment of 1,5 JD for every mined ton of oil shale. The tariff will uniquely for Jordan have very limited linkage to oil or commodity prices.
Construction of the power plant is expected to commence over the course of the following 12 months after conducting financing due diligence and finalising the funding arrangements. The power plant is scheduled to start generating electricity for local consumption in the second half of 2018.
APCO's oil shale fired power plant is expected to reduce the Kingdom's expenditure on energy imports by more than JD 350 million per year, in addition to creating 3,500 jobs during construction and 1,000 jobs during operations. The investment value of the project is 2.2 billion USD, making this the largest externally financed project in Jordan to date.
Jordan, which imports about 96 per cent of its energy needs annually at a cost of over one-fifth of the gross domestic product (GDP), has an estimated 70 billion tonnes of oil shale reserves, which makes it the fourth largest hub for oil shale in the world, according to the Natural Resources Authority (NRA).