Kardan NV has announced that a consortium of Sinohydro Corporation and GE ((previously Alstom Hydro) has signed a principle construction agreement for a 340MW pumped storage project in Israel.
In a statement, Kardan said that project developer Star Pumped Storage Ltd, in which Kardan's subsidiary Tahal Consulting Engineers Ltd (TCE) holds a 40.5% stake, signed the EPC agreements with the consortium in a deal valued at around EUR 394 million.
In addition, an 18-year operating and maintenance agreement was signed with GE Renewable Energy Ltd which would amount to around EUR 3.7 million. The agreement includes possibilities to end the deal early if required.
The terms of the two agreements are subject to approval of the banks financing the project. In addition, the completion of both agreements is subject to financial close of the entire project, which is expected in the third quarter of 2016.
Tahal expects that the early work (according to a separate agreement) will start immediately, and that the main construction process will begin towards the end of 2016. The project is expected to take approximately 52 months to complete.
In addition, the board of directors of TCE has decided that TCE should sell part of its holdings in the project, in order to continue developing the core areas and growth engines of Tahal Group.