Russian-Libyan Venture Plans $6.73 Billion Power Projects in Africa and Middle East

Russia's state-owned power plant developer, Technopromexport (Moscow, Russia), and Libya African Investment Portfolio (LAIP) (Tripoli, Libya), a state-owned investment fund, have joined to construct and operate power-generating facilities in six African states--Algeria, Egypt, Ghana, Libya, Namibia and Uganda--and Yemen in the Middle East. The two firms have established a joint venture company, Laptechno-Power, for this undertaking. LAIP will finance these projects, the total cost of which amounts to $6.73 billion.

Laptechno-Power will first undertake the construction of a 1,250-km electric transmission line with a capacity of 400-kW in Libya. Technopromexport has reportedly concluded the topographic survey for the project. The firm has also drafted a preliminary design and proposed a commercial offer for three sections of the transmission line, including the 470-km Tobruk-Benghazi section, the 400-km Tobruk-Adjabia section and the 380-km Sirt-Beni Walid-Abu Argub section. Another project that tops the priority list is a hydropower plant with a power generation capacity of 300-MW on the Blue Nile River in Uganda.

On April 17, 2008, Russia and Libya entered into a memorandum of understanding for mutual cooperation in the power sector during a visit to Libya by Russian President Vladimir Putin. Technopromexport and LAIP entered into an agreement in November this year to establish Laptechno-Power as a general contractor for turnkey construction projects in Africa and the Gulf region.

LAIP, a part of the Libyan Investment Corporation, was established in 2006 with an initial investment of $5 billion as a fund committed to financing projects in African nations. LAIP is currently funding projects in diverse sectors, including agriculture, aviation, real estate, and oil refining and distribution.

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