To:-
The Rt.Hon. Emad Khamis,
Minister of Electricity,
MOE,
Syrian Arab Republic
21st November 2011
CC to Dr Mashfej
By Email from Navy Group Cyprus, Dr Tom Davies.
Email:- navy
Tel: 0035799989910.
Dear Minister,
Once again, it was my honour and privilege to meet with you at your office yesterday.
I confirm my request that your purchasing committee considers all aspects of our offer with the greatest of speed, as the four TGF9 GE units in stock at present are held to my name only, and may be re-allocated beyond my control until l can formally contract for their purchase.
Such loss would delay the delivery from new supply of any one or all four units, to be estimated as 18 months from the date of order, and require further calculation of our financial part of our offer.
I am prepared to meet with you at three days notice for any reason that may be of any assistance, and am always available by phone to arrange an appointment or prepare information requests by private email.
Below are the details of the finances as adjusted as the addendum to my last email to your office.
I have adjusted these figures to be at cost to ourselves, knowing that the virtue of such an arrangement in your favour will be of great assistance to your Country.
In return, l request that such contract we agree is balanced to be more financially flexible in our favour with regard to the expedition of payment terms, due to the fact that we have removed any margin for error or delay, and l therefore underline our requirement for the provision of comfort by prime bank confirmed BG in consideration at the time of each step.
DETAIL OF FINANCIAL ADJUSTMENTS
1/.
At the signature of contracts, we will require a prime bank confirmed bank guarantee ( Nu. 1) for ninety seven million Euros in order to secure retention of the supply of the four TG F9 units in stock and register the order for the other two new ones.
These 4 units can then be held to our order for a period of six months, and all funds paid are deducted from the total purchase value at payment prior to shipping CIF to the port of Tartus,
and the two new ones can be facilitated to begin manufacture, according to a procedural reference for payment in full.
(NOTE:-
a/.
The shipping to a site by your committee member from the Ministry of Transportation need have attention to the issue of size of each TG unit, at it is 210 Metric Tonnes and the size of a house, as detailed in our original issue specification documentation.
Due to this issue, my suggestion to site the power plant at a location as near to Tartus port as possible adds to this subject, or the facility to move any distance by road each TG unit may have impossible obstacles.
Such was the case in Nigeria recently, when they Government had to wait four years for bridges to be completed before the units could be sited, and they suffered storage damage as a result.
b/.
The Port of Tartus need supply us with pre- contract confirmation that they are able to off load such sized cargo safely.
c/.
The provision by contract of an LPG terminal at Tartus capable of supplying the power plant directly, which will be expandable to cope with enough supply over 25 years for a power plant of 4,000MW capacity.)
2/.
The second step is the provision of a BG Nu.2 for 130% of the entire cost of the TG units and the ordering of two from new supply, including shipping CIF to Tartus, and at our bank’s acceptance of issue of this BG, the cancellation of the first one.
The value therefore is net E220M Euros, and the BG value at issue is E286M Euros.
This BG need be opened and rolled over each year for the period of the contract.
3/.
The third step is the provision of a BG Nu. 3 for 130% of the entire cost of the BOP and installation.
This can be stepped, but must facilitate the site location and transportation and infrastructure as costs that are variable and must be agreed and confirmed to be adjustable according to new, changing, or additional requirements for the proper working of the power plant.
The addition of works for extension of the national power grid, an adequate water supply and road link need be detailed when a site is agreed, and contracts for these provisions may be discussed and detailed then as you wish.
This is with specific reference to the agreed idea for expansion of the lucrative sale of electricity to Lebanon, where further pylons and cabling will required.
The value of this BG is E390M Euros, and need follow the same procedure in practice as point 2/.
( NOTE:-
The extra contract for the supply of natural gas by pipeline from Iraq Basra region or KRG Regional Government, should be considered as an alternative to supply by sea of LPG.
As such, an LPG terminal at Tartus port may be considered at a smaller scale- enough to supply the existing proposal- whilst such a pipeline installation is commissioned and becomes operative. )
4/.
I have reduced the overall face value by E80M Euros, and the provision for expedience has been reduced from 10% of installation costs to 1% ( inclusive).
As such, our intended contract should be balanced by a closer implementation relationship before and during construction that will preclude and of our mutual interests from becoming a problem or an issue.
This sum need not be paid in hard currency by your Government.
By virtue of special international financing arrangements, we are able to operate outside of current and traditional practices.
Only the provision of a trade by contract for crude oil equal to a monthly amount for the contracted period need be begun at the date of contract or before, and the maintenance, as detailed previously.
Such sum equates to the contracted amount of crude to be agreed and provisioned with a degree of flexibility to reflect changing aspects of support as may be required between us, to expand and facilitate the power plant and its support services, by note within this intended contract, and/ or reference to a further ability to provide additional or separate contracts.
5/.
The traditional use of a Governmental issue of LC opened against a BG by supplier in return, need therefore not be accounted, and forms the basis of an entirely different method of project funding, which is off balance sheet.
Being off balance sheet, the Governmental balance of payments is untouched, and the appliance of economic strategy in practice is enhanced for the entire period of the financial operation of the contract.
6/.
For further details, please may l refer you back to our last issued amendment to our original proposal, of earlier this month.
I look forward to any advice or assistance that you may be able to offer with regard to the operation of our intentions, and to working together long term for the betterment of your Country and its people.
Dr Tom Davies
Vice President
Navy Group Cyprus
( Navy Group International)
Tel. 0035799989910
Email:-