(MENAFN - Jordan Times) Construction of the Kingdom's first oil shale power plant is expected to start next year after negotiations are finalised by the end of 2011, an official from the Estonian company working on the plant said on Monday.
Andres Anijalg, project director at Enefit's Jordan Oil Shale programme, said his firm is in the final stage of negotiations with the Ministry of Environment and the National Electric Power Company to establish a 600 to 900 megawatt direct combustion power plant operating on oil shale.
"Hopefully, the negotiations will be finalised by the end of the year, so we can start constructing this plant by early next year," he added during the Jordan Energy Investment Summit, which started yesterday.
Anijalg said the cost of operating a power plant on oil shale is "significantly lower" than operating it on diesel, heavy oil or gas.
"Speaking from our experience in Estonia, we have shut down the plants that operate on gas because we found it much cheaper to generate electricity from oil shale," he explained.
Enefit, an affiliate of Eesti Energia, is one of the three companies working on extracting oil shale in the Kingdom.
The Estonian company is one of the largest oil shale-to-energy companies in the world, with around 100 years' experience in exploiting the resource, according to Anijlag.
The government signed a 44-year product-sharing agreement with Eesti Energia in 2010, under which the firm will extract oil shale in the central region, producing up to 40,000 barrels of oil per day by 2019.
The two-day energy summit gathers over 80 investors from around the world to discuss investment opportunities and challenges in Jordan's energy resources, including oil shale, renewable energy and natural gas, according to organisers.
"Developing our indigenous resources should be a pillar of our energy policy," the summit's chairman and former director of the Natural Resources Authority (NRA) Maher Hijazin stressed in an address at the opening ceremony, citing oil shale as "a real story of success".
Hazem Al Ramini, head of the policies and contracts division at the NRA, noted that there are still "environmental concerns when resorting to oil shale extraction", adding that work is under way to draft laws and by-laws to enforce and develop environmental monitoring.
In addition to Eesti Energia, Karak International Oil, a subsidiary of the UK registered Jordan Energy and Mining Ltd., and the Royal Dutch Shell Oil Company are also working to tap the Kingdom's oil shale resources.
Jordan's oil shale reserves extend over more than 60 per cent of the country and amount to an excess of 50 billion tonnes.
Under the national energy strategy, electricity produced by oil shale is to account for 14 per cent of the Kingdom's energy mix within the next decade.