Estonia to build oil shale plant in Jordan

  • 2008-05-08
  • Staff and wire reports

Selling coal to Newcastle: Liive announced plans to bring Baltic expertise to the Middle East.

TALLINN - Eesti Energia (Estonian Energy) announced on April 30 that it has signed a contract with the Jordanian government and the state-owned power company to build the Middle East country's first oil-shale fueled power plant.
Under the agreement, Estonian Energy will have the exclusive right to develop the construction of a 900 megawatt power plant, including all the lengthy preparations needed before the actual building can begin, the company said.
The deal's value was not announced.

Estonian officials lauded the unprecedented agreement, which will finally allow the Baltic state to capitalize on its unique status as an oil shale-reliant state.
"It's worth pointing out that one Estonian enterprise has undertaken such a massive project," said Economic Affairs Minister Juhan Parts, who traveled to Jordan to participate in the signing of the deal.
Khaldoun Qutishat, the Jordanian minister for energy and mineral resources, said the project was a breakthrough for the Middle East country since a shale oil plant would help it realize the decades-long aspiration of reducing independence on imported energy in one of the world's most volatile regions.
Indeed, for Jordan, a net energy importer, the prospect of developing an oil shale industry was probably too enticing to pass up.

"The power plant to be built in Jordan would be the first considerable oil-shale fueled power plant operating outside Estonia," said Estonian Energy Chairman Sandor Liive.
"We will have the wonderful opportunity of applying the knowledge and skills accumulated in Estonia in the valuation of oil shale and getting energy out of that mineral resource," he said.
Estonian Energy will provide its know-how, while the capital necessary will be borrowed from major investors, the company said.
In addition to the power plant, Estonian Energy may also help construct a facility for producing liquid fuel from oil shale, which would be a boon for Jordan.
The Estonian utility has presented its proposal, and talking on a possible deal will soon be launched.
Estonia is the most oil shale-reliant state in the world, getting some 80 percent of its energy needs from the fossil fuel.

Eesti Polevkivi (Estonian Oil Shale), the mining arm of Estonian Energy, extracted a total of 16.3 million tons of oil shale in the business year ended in March, the biggest amount in the last 15 years.
In all, the company sold 17.2 million tons of oil shale in the 2007-2008 business year.

Liive told an energy forum on May 5 that there was no reason to delay deregulating Estonia and other EU member states' electricity markets and that moving the 2013 deadline forward would bring more clarity to the market.
As he explained, investors are busy creating electricity generation capacities in which a significant part of income comes from subsidized energy, and in such an atmosphere there is little wish to establish a free market for energy production.
By opening up the energy market earlier than 2013, investments would be more rational and reflect capacities capable of coping in a normal, competitive environment.
Considering the present situation, a speedier opening of the Estonian market would mean a rise in the price of electricity, as the open market price is higher than the current, regulated one, Liive admitted.
Under current plans, the electricity market will open for corporate customers in 2009 and then for households in 2013.