Russian firm opts out of Iran power plant project

May 12, 2006 23:08

A Russian company said Friday that it had abandoned a US $500 million project to build a thermal power plant in Iran because of Iranian authorities' refusal to raise the contract price in compensation for rising costs, news reports said. The Tekhnopromexport company said that in 2001 it signed a preliminary agreement with Iranian authorities to build the Tabas thermal power plant and develop a coal mine intended to produce coal for it, according to a statement carried by the ITAR-Tass and RIA Novosti news agencies. It said that foot-dragging by Iranian officials had resulted in the project becoming unprofitable because of rising costs. Tekhnopromexport said that it wanted to raise the contract price to US $800 million, but Iran refused.

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