Due to nature of its activities and the fixed contractual framework within which the Company operates we foresee no major change in the Company’s activities.
Due to tariff structure contained in the Power Purchase Agreement, the Phase I revenues stands reduced beginning the last quarter of 2011. This trend will continue and is not reflection of the operational performance of the Company, but is solely dependent on the agreed tariff structure for the life of the project.
Year 2016 will see end of 20 year term of Phase-1. As per the conditions of the Power Purchase Agreement, the fixed capacity fee for Phase 1 plant and fixed capacity fee for the transmission network will end in September 2016. The Company will continue to run the Phase-1 units till 2020 at which time the plant assets including Phase-II will be handed over to the government. Transmission network are scheduled to be handed over in 2016.
However, the Company is eagerly awaiting an outcome of the study undertaken by the regulatory authorities which among other things could determine the continuity of operations beyond the initial term stated in the Power Purchase Agreement. The Company is committed to explore all possibilities to enhance shareholders returns and will seek shareholders’ approval if and when any such opportunities arise.