Company developing first oil shale plant seeks extension on October deadline

AMMAN — The company developing Jordan’s first oil shale power plant has secured $17 billion but will seek a government extension on the October 1 deadline to finalise “routine procedures” to secure financing for the project.

The Attarat Power Company (APCO) has already signed a memorandum of understanding with the Bank of China and the Industrial and Commercial Bank of China, with a guarantee from state-owned China Export and Credit Insurance Corporation (Sinosure), to obtain a $1.7 billion loan to finance the plant.

“The rest of the funding needed for the plant will be provided by stakeholders in the project… Now that we have secured the majority of the money needed for the project, a few more routine procedures are required before a final deal is reached with the lenders and before construction starts,” he said.

The company is a wholly owned subsidiary of Enefit Jordan BV, which is itself owned by Enefit (Estonia’s Eesti Energia AS), Malaysia’s YTL Power International Berhad and Jordan’s Near East
INVESTMENTS Limited. 

The $2.2 billion, 470-megawatt (MW) project is expected to be operational in the second half of 2018, as stipulated in a deal signed with the Jordanian government in 2014.

The consortium recently expressed concern over its abilty to secure financing for the project after many agencies, including the International Finance Corporation, the European Bank for Reconstruction and Development and the Islamic Development Bank, among others, either rejected applications for funding or showed no interest in financing the project. 

The project, anticipated to create 3,000 direct jobs during the construction phase and 700 jobs for ongoing operations, is expected to utilise Jordan’s vast reserves of oil shale, estimated at more than 70 billion tonnes.

The energy sector has been central to the economic reforms in the Kingdom, as Jordan currently imports around 97 per cent of its energy requirements, as the National Electricity Power Company  ran a JD3.45 billion a deficit in 2014, and an outstanding debt to the Jordan Petroleum Refinery Company at JD558 million.