The Minister of Economy and Sustainable Development Natia Turnava declares that strategic projects like the Namakhvani HPP should be implemented under the leadership of the state, but not with the participation of 100%-share.
ENKA, investor company of Namakhvani project worth of USD 800 million, has closed its offices in Tbilisi and Kutaisi. As BM.GE has been informed, most of the company’s employees have already left their jobs.
According to the Minister, when high economic growth in the country is important, energy development and the implementation of large energy projects are an essential component for these processes. Therefore, the state should play a leading role in such projects, because the implementation of such projects is not so easy in Georgia.
"Georgia has no experience in the construction of large-scale dams in recent history. There was a very big break after the big projects implemented in the Soviet Union. Historically, during this period, a negative attitude towards large energy projects was formed from the 90s. There were so many factors in reality that it is not easy to build such a large project now, especially when it involves a private foreign investor who has his own goals and, first of all, it is the profitability of the project. They prefer less risky projects. Sometimes, investors are not ready to show the appropriate flexibility and patience in this regard, so the responsibility shifts to the state. State leadership in such projects is inevitable; This does not mean that the state should do it 100% with its own funds, but the state should play a leading role.
Strategic energy projects must be developed under any circumstances, Namakhvani project has shown that if the state is a leader, it raises more confidence towards the strategic projects," the minister said.
According to Natia Turnava, the state is ready for this type of project and resources are always available for such projects, because energy security and economic growth depends on it.
At the same time, Natia Turnava notes that negotiations are underway with ENKA before the arbitration dispute, so that the investor can leave the project based on the mutual negotiations.
"Regardless of how our further relations with ENKA or any other investor will develop, and whether the investor will be able to establish proper communication around the project, this project itself should not be damaged. We will try to close this case without arbitration dispute with the investor. If we see that the investor is ready to become more flexible and communicate with the population, as well as answer the environmental issues correctly and has a will to return, we will talk about that as well. But, if it turns out the investor prefers to leave, this should be done without dispute, on the base of mutual negotiation," Turnava explained.
The Namakhvani HPP was one of the largest energy projects in the history of independent Georgia.
However, ecologists and local residents were strongly opposed to the construction of the power plant, fearing that a project of such a size would increase the seismic activity, change the local microclimate and damage local villages.
Over a half year-long protest against the construction of the Namakhvani Hydropower Plant project took place last year and participants of the rally, led by Varlam Goletiani, the leader of Rioni Gorge Defender’s civic movement demanded from the government to abolish “anti-state” contract.
On the background of the protest, Turkish contractor company ENKA Renewables LLC, who had intended to construct the Namakhvani hydro power plant on the Rioni river in western Georgia, notified the government of Georgia that it was terminating the USD 800 million project in the country.
The statement published by the company read that the reason for the cancellation of the contract with the Georgian government was the violation of the terms of the contract and force majeure.
