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Uzbekistan signs 10-year deal on power supplies to Afghanistan

21 September 2019

(Translation from original in Russian) A 10-year contract on electricity supplies from Uzbekistan to Afghanistan has been signed. At the initial stage, 4.2bn kWh [of electricity] will be supplied and the amount will subsequently increase up to 6bn kWh.

[Uzbekistan's] Natsionalnyye Elektricheskiye Seti company and the DA Afghanistan Breshna Sherkat energy company signed the 10-year "take-or-pay" contract on electricity supplies on 20 September, a Gazeta.uz correspondent has reported.

Uzbekistan has regularly supplied electricity to Afghanistan since 2002. Over that period, the amount of supplies increased from 62m kWh to nearly 2.6bn kWh, the figure expected for the end of 2019. The contracts have so far been concluded for a year.

"The contract is for 10 years. It provides for electricity supplies year-round, not on a seasonal basis," Uzbek Deputy Minister of Energy Sherzod Khojayev said following the signing ceremony. He said that at the initial stage, 4.2bn kWh will be supplied, with the amount eventually increasing up to 6bn kWh.

Khojayev said that although it is a take-or-pay contract, the Uzbek side has met the Afghan partners halfway and has "quite significantly eased the terms".

"Taking into account the complicated situation in Afghanistan, we agreed on a more flexible schedule for supplies to not make them pay fines," the deputy minister said.

Earlier an Uzbek Energy Ministry official said the contract was one of the terms set by the Asian Development Bank to finance the construction of a new power transmission line Uzbekistan's Surkhon to Afghanistan's Pol-e Khomri.

During Afghan President Ashraf Ghani's visit to Uzbekistan in December 2017, the governments of the two countries signed an agreement on construction of the 500-KW power line Surkhon-Pol-e Khomri. In April [this year], Uzbekenergo [energy company] began construction of the power line on Uzbekistan's territory. The 260-km-long power line will enable Uzbekistan to increase electricity supplies to Afghanistan by 70 per cent - up to 6bn kWh a year. The project is scheduled to be finished by the end of 2020.

The project, which is estimated at 150m dollars, will be funded by the governments of Afghanistan and Uzbekistan, with the latter allocating 45m dollars.