The Italian company is seeking Euro 66 million in compensation at the Arbitration Court while the Albanian government is seeking 12 million euros through power corporation KESH
TIRANA, Nov. 7 – The Albanian state-owned power corporation KESH and the Italian company building the Vlora thermal power plant are facing trial at the International Court of Arbitration in Paris over financial disputes. The dispute comes after Italy’s Mire Engineering was not awarded all money by the Albanian government for delaying the World Bank-funded project. The Italian company is now seeking Euro 66 million in compensation at the Arbitration Court while the Albanian government is seeking 12 million euros through power corporation KESH, according to a document made available by the State Advocacy office, which has also announced a tender for Nov. 14 to select a legal firm that will represent KESH in the trial.
The Vlora thermal power plant should have been made operational since May 2009, but the project was delayed because of a failure in the plant’s cooling system. Because of delays KESH asked the World Bank to suspend a Euro 10 million payment to the company and execute a Euro 5 million guarantee, local media report.
The Vlora thermal power plant, a new 97 MW USD 112 millions low-sulphur distillate oil fuelled power plant, available for use since two years, has not been put to use because of high fuel costs. The only hope is the Trans Adriatic Trans Adriatic Pipeline (TAP), the only international natural gas project including Albania in its route, whose stakeholders are currently negotiating exclusively with the Azerbaijani authorities to transport gas from the Caspian to Italy. Experts have often criticized the high cost of electricity produced by the Vlora power plant which at13 lek per kWh, is twice higher compared to the cost of imported electricity.
