After foreign companies withdraw, Albania’s government says it is looking into building a new half-a-billion euro power plant on the Drin River with government funds.
TIRANA, Feb. 4 – After a deal with foreign investors to build a fourth large hydro-electric power plant on the Drin River fell through, the Albanian government said this week it will build the plant itself if that’s what it takes to get the project done.
If the 500-million-euro Skavica Hydro Power Plant is actually built, it would rival only the Durres-Kukes highway as a public works project implemented in Albania after the fall of Communism.
Speaking to reporters this week, Prime Minister Sali Berisha said companies that had shown interest in a concessionary project withdrew because of the international financial crisis.
“After all calculated costs are in, the project has cost a minimum of a half a billion euros, or even more. In extreme cases we may take other shareholders, but the government will have a leading role, whether KESH builds it and the government will serve as guarantor for the loans or whether the government builds it directly with budget funds,” Mr. Berisha said.
Preparation of the project might take up to two years as the construction would create a large lake in the area that could reach the Macedonia border to the east.
“Within this mandate we should start work and in the next mandate we can turn this into the next major infrastructure work in the country,” Prime Minister Berisha said.
The Skavica project is more than 30 years old, as it was first planed in 1978, but it was not implemented due to lack of funds.
Skavica is south of Kukes in the Diber region and on the Black Drin River, before it meets with the White Drin near Kukes.
According to the government, because Skavica would be the first dam on the Drin when it enters Albania, it would significantly improve the extensive flooding situation seen in areas south of Shkodra, as it offers an early barrier against the waters.
The project was originally given to an Italian-led consortium, Tassara-Geotecna-Kinglor (TGK), requiring an investment of 664 million dollars.
TGK had said 70 percent of the project would be financed through bank loans, and the group itself will finance the other 30 percent.
As TGK withdrew for lack of funding, Norwegian company Statkraft, the largest company in Europe in the field of hydro-power showed some interest, as did RVE of Germany. But ultimately things did not work out because of the financial crisis.
“We have two alternatives. The first is to go to tender again. But the second alternative, which we are now favoring, is for the Albanian government to take over construction,” Prime Minister Berisha said Wednesday.
