OREANDA-NEWS. July 25, 2008. The Ministry of Economic Development (MED) of Azerbaijan has almost completed the process of contract talks on a project of construction of a garbage processing factory nearby Baku.

Asker Alakbarov, the director of the MED Department of Foreign Investments & Technical Assistance Coordination, said that today they would coordinate the last part of package of contract agreements with France’s CNIM (it will undertake build construction and management of the enterprise).

“We expect the last part of the package will be ready for submission to the Cabinet Ministers on July 29. Earlier part of agreements has been presented to the Cabinet,” Alakbarov said.

The project cost will be known only after the sides accord the package matter.

CNIM will undertake 20-year management of the garbage processing factory and then this period can be prolonged by another 10 or 15 years. No tax or other subsidies are expected.

The draft contract says of 36-month construction of the factory from the moment of contract signing, including three or four months for surveys and making of an environment assessment impact report.

CNIM will be supplied main equipment by Martin (this firm along with CNIM is a member of the same group of companies).

The tender procedure for the enterprise construction was closed on February 11, 2008. UK’s Currie&Brown is the MED’s consultant in the project.

The bids for the tender were received from CNIM (France), EVN (Austria), Enconi (Germany) and Mosekostroy/Mossptsstroy (Russia).

The construction will be funded from State Budget, although the issue of raising of finances from international markets will also be considered. State Investment Programme 2008 envisages allocation of over AZN 100 million that fails to cover whole project cost.

Azerbaijan scheduled start of construction of the garbage-processing enterprise in the first half of 2008. The factory will incinerate 500,000 of wastes a year.

There are three landfills around Baku. The new garbage complex is to process at least 600 000 tons of domestic waste a year that means creation of 1 or 2 factories.

Under primary estimate, the project expenditures totaled about USD 300-400 million. Then expected garbage processing grew up to 775,000 tons.

As a result, Azerbaijan decided to build two factories to process by 500,000 tons of garbage. One of them will be located in Baku and another in a region. At the moment speech is about the first of them.

EBRD has claimed its interest to finance the garbage complex project.