“Russia had signed an agreement with Iran to build the 1,400-megawatt thermal power plant in 2016, but the project stalled owing to administrative and funding problems. Now the Russian government has issued a guarantee for a $1.4 billion loan to fund the construction of the power station in southern Iran,” the Energy Ministry’s news portal Paven quoted Ardakanian as saying.
“The project is estimated to cost $1.7 billion. Today, we received the guarantee for the $1.4 billion loan and we will provide the rest.”
Russia’s Power Machines, a Saint Petersburg-based engineering company, has been recently contracted by Moscow to use Russian funds to build the 1.4-gigawatt power plant. Iranian companies and manufacturers will also contribute to the project.
In 2016, Iran's Thermal Power Plants Holding Company signed a contract with Russia’s Technopromexport to build the power plant comprising four units of 350 MW each. However, the project never saw the light of day.
Now with the change of the contractor and loan guarantee, the facility is expected to be built over the next five years.
Power Machines Company is a global power engineering entity and one of the world’s top 10 industry leaders in terms of installed-equipment volume. It has a wealth of experience and expertise in engineering-design, manufacturing and supply equipment for thermal, nuclear and hydro power plants.
TPPHC is responsible for organizing government activities in thermal power generation by planning, developing, managing and operating power plants based on the policies of Energy Ministry.
“The project is considered a key step toward stabilizing electricity network in normally underprivileged regions in the south and southeast of the country,” Ardakanian said.
The construction of Sirik power station in Hormozgan Province will create 3,000 jobs and 500 more will work at the plant when the first unit comes on stream.
Sirik County overlooks the Strait of Hormuz, between the Persian Gulf and the Sea of Oman.
Thermal power plants in Hormozgan Province have an installed capacity of over 3,000 MW and there are plans to increase output to 7,000 MW by 2024.
In 2019, Thermal Power Plants Holding Company had signed a memorandum of understanding with the Power Machines Company, based on which the Russian firm was to finance the project to modernize and develop the 1,850-MW Ramin Power Plant in Ahvaz, Khuzestan Province.
Russian officials have often voiced interest in expanding economic ties with Iran. The two sides have held wide-ranging talks on ways to promote collaboration in the fields of energy, railroad and aviation.
Russia has also carried out the construction of the first unit of Iran’s sole nuclear power plant in Bushehr Province. It came on stream in 2011 and reached full capacity (1,000 MW) the following year.
In 2014, Iran signed a contract with the Russian company Rosatom and its subsidiaries to build two more reactors on the same site.
Russia is expanding its footprint in Iran's nuclear energy sector against a backdrop of growing political and economic cooperation between the two sides.
Moscow took over the construction of Bushehr Nuclear Power Plant from the Germans in 1995 and commissioned the plant in September 2011 despite technical hurdles and international restrictions.
The second and third Bushehr reactors are scheduled for launch in 2024 and 2026 respectively.