Meghri Dam Construction to Start by Feb.

Meghri Dam Construction to Start by Feb.Meghri Dam Construction to Start by Feb.

Construction of the Meghri Dam on the Aras River near the Iran-Armenia border will commence within 2 months, managing director of the Iran Water & Power Resources Co. (IWPCO) said, ISNA reported.

"Due to changes in the water flow of Aras and climate changes in the region, power generation capacity for each country was decided to decrease from 130 MW to 100 MW," Mohammad-Reza Rezazadeh said, adding that the diameter of the plant's tunnel will also shrink by 100 centimeters to 7.5 meters.

Meghri Dam, also known as the Aras Dam, is a hydroelectric complex under construction near Armenia's southern town of Meghri on the Iran-Armenia border. Construction started in 2012 and is expected to be completed by 2016.

The project consists of two power plants; the Ghare Chiler (also Gharachilar or Karachinar) on the Iranian side and Meghri in Armenian territory.

Assessments for construction of the Ghare Chiler plant has been completed, but Meghri requires further in-depth studies.

Financial and banking constraints between the two countries were an obstacle for development of the Meghri dam in the past two years. However, the Islamic Development Bank (IDB) has plans to fund the project, according to Rezazadeh.

IDB is a multilateral development financing institution based in Saudi Arabia. It has 56 member-states, and Iran, Saudi Arabia, Turkey, Egypt and Qatar are major shareholders.

Last week, energy officials from Iran and Armenia met in Tehran and discussed the dam project and an electricity-for-gas deal, among other things. Based on agreements, Iran will import electricity from Armenia during peak demand in exchange for gas.

Any increase in the level of imports would depend on the volume of gas exports to the northwestern neighbor.