Chinese state-owned company Guangdong Power Engineering Corporation and Attarat Power Company (APCO), a majority of which is owned by Eesti Energia, have signed a deal to build a 554-megawatt oil shale plant in Jordan.
APCO chose the Chinese company out of six bidders and signed a pre-contract at the end of last year.
The news is another major step in Eesti Energia's venture in Jordan, having signed a contract to sell electricity to the state for the next 30 years at the beginning of the month.
The price will be half of the 150 euros per megawatt/hour currently paid by the state, but far more expensive than the between 30 and 50 euros MWh paid by Estonian consumers.
The electricity sale contract was a precondition for the building contract, which in turn will lead to the financing round. Andres Anijalg, head of Eesti Energia's Jordan project, said Chinese banks will now begin a technical and financial analysis of the project.
He said construction could begin in the next 12 months, and the first power could be produced at the end of 2018.
The estimated cost is around 1.75 billion euros. Eesti Energia could relinquish part of its 65-percent piece in APCO to co-fund the project.