DUSHANBE, August 30, Asia-Plus — Tajik government’s decision to break a US$1 billion contract with Rusal (Russian Aluminum) for construction of the Roghun hydroelectricity power station (HPS) has put top managers of the Russian aluminum giant into a state of perplexity, Russia’s news agency RBK Daily said. 

We will recall that Tajikistan''s government made the decision to break the contract with Rusal on Wednesday, August 29.  A joint stock company established by the Central Asian country''s government would take up the remaining work to build the facility.

After the contract was signed in October 2004, Tajik authorities and Rusal failed to reach an agreement on the completion of the project, and work was not started.

While commenting on the decision, the head of Rusal''s Dushanbe office, Konstantin Zagrebelny, said he had not received any notification from the Tajik authorities. "Such agreements cannot be severed unilaterally," he said, refraining from giving further comments. 

RBK Daily cited Rusal''s press service as saying that the company has made every effort to fulfill its obligations under the contract.  

Under the contract, Rusal pledged itself to invest in the construction of two electrolysis workshops with an annual capacity of 100,000 tons in the Tajik Aluminum Plant in Tursunzoda  and build a new aluminum smelter in the south of Tajikistan with an annual capacity of 200,000 tons.  The company was also going to invest in completing the construction of the Roghun hydroelectric power station on the Vakhsh River, which would supply the new plants with electricity, part of which would  be exported outside Tajikistan.  It was Russia''s largest investment project in Central Asia and amounted to more than 1.2 billion US dollars.  

According to RBK daily, Rusal’s press service noted that the company had invested $50 million-$70 million in Tajik projects, having prepared feasibility study for the plant.  Construction work has been held up due to disagreements between Rusal and the Tajik government over the size of the dam.

President Rahmon offered to set up international consortium to complete construction o the Roghun station.  The head of Barqi Tojik (Tajik electric systems) power holding, Sharifkhon Samiyev, noted that Rusal had to date invested $247,000 in the Roghun project but not $50 million as Rusal stated.      

Some Russian experts hold that removing from the project is not so big loss for Rusal.  The Roghun hydroelectricity project its was scarcely interesting for the company, which hoped to participate in privatization of the Tajik aluminum plant.  Tajikistan refused to allow Rusal going ahead with its privatization plans and stated last year that it is not going to sell the plant.    

Other experts say that the issue of cooperation between Rusal and Tajikistan has become politically motivated.  “Tajiks wanted higher dam to regulate the river flow in order to dictate terms to Uzbekistan,” said Sergey Borovikov.  

President Emomali Rahmon told an international electrical-power conference in Varzob on October 27, 2007 that Tajikistan will start the construction of the Roghun hydropower plant in 2007 on its own.

The 3,600 MWt Roghun hydroelectric plant is to generate 13 billion kWh of electricity per year.