Gaza Power Project

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A Power Purchase Agreement was signed in June 1999, between Palestinian Energy Authority and Palestine Electric Company, a public shareholding company in Gaza, to build, own and operate a 140 MW power plant. Financing is based on 30 percent equity and 70 percent debt. One third of the equity shall be owned by the public, one third by PEC and one third by Enron Middle East subsidiary company. The debt will be held mainly by the Arab Bank. The initial term of agreement is 20 years, with the option of being extended for two additional five year periods. The price structure consists of fixed capacity and O&M payments. Fuel for the plant will be supplied and paid for by the PEA. ABB of Sweden was awarded the construction to engineer, procure and construct the power plant. Enron will do the operation and maintenance of the project. Consolidated Contractors International Company (CCIC), a major shareholder in the original project, helped to salvage the project in February of 2002 by buying up the 33.5 percent stake held by the scandal-ridden American energy trading corporation Enron. CCIC is now a 42 percent partner. None None