Dubai-based Investment Company, Rasia, Awarded $3 Billion Railway and High Speed Road Projects in Armenia

Thu Jan 24, 2013 7:50am EST

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Rasia, China Communications Construction Company, and South Caucasus Railway to
cooperate with the Republic of Armenia
YEREVAN, Armenia, Jan. 24, 2013 /PRNewswire/ -- Pursuant to an instruction by
the President of the Republic of  Armenia, Minister  Gagik Beglaryan  of the
Ministry of Transport and Communication of the Republic of  Armenia  announced
the launch of the Southern Armenia Railway and Southern Armenia High Speed Road
Projects, a strategic infrastructure investment for  Armenia  valued at
approximately  US$3 billion.  

During a presentation, signing ceremony and public announcement attended by
senior government officials, ambassadors, investment and sovereign funds, and
corporate executives from  Armenia,  China,  Russia, the  United Arab Emirates,
and  Iran, a tripartite Memorandum of Understanding on regional cooperation
towards the development of the Southern Armenia Railway was signed between Rasia
FZE, South Caucasus Railway CJSC, and the Ministry of Transport and
Communication of the Republic of  Armenia.

The Southern Armenia Railway is anticipated to be a 316km long electrified
single track railway, which will connect Gavar, near Lake Sevan, to the southern
border of  Armenia  by Meghri and will be integrated with the existing central
railway system of the Republic of  Armenia, operated by South Caucasus Railway
CJSC and the operating railway system of Iran.  The Southern Armenia High Speed
Road, to be constructed in  Armenia's southern province of Syunik, is
anticipated to be a 110km long expressway connecting the town of Sisian to the
southern border of  Armenia  by Meghri.

Both projects will form a part of the International North-South Transport
Corridor, which will play a pivotal role in improving regional connectivity and
driving economic growth along the Corridor, and will create the shortest
transportation route from the ports of the Black Sea to the ports of the Persian
Gulf.  When the projects are completed, transport costs and times for the region
are expected to improve substantially, fostering greater regional trade and
economic growth while dramatically strengthening the Armenian economy.  The
implementation of these projects is envisaged by the electoral program of the
President of the Republic of Armenia Mr.  Serzh Sargsyan  and is among the top
strategic priorities for the Republic of  Armenia.

In 2012, the Republic of  Armenia  signed with  Dubai-based investment company,
Rasia FZE, two concession agreements for the vitally important transport
projects in order to develop them on a Public-Private Partnership basis.  The
concession terms provide specific periods for completing feasibility studies,
engineering designs, project financing and construction and are followed by a
30-year operating period, renewable by Rasia for an additional 20 years.  Among
other strengths, the concession terms confer upon Rasia the right to freely
establish freight rates and tolls while providing protection from competing
projects. Chairman and CEO of Rasia, Mr.  Joseph Borkowski  said, "As the key
missing link in the International North-South Transport Corridor, the projects
have attracted significant regional interest from both strategic and financial
partners waiting to participate in their development."  Rasia is already
implementing a consortium-based strategy for the feasibility, design, financing,
development and operation of the projects.

Rasia has successfully negotiated and recently signed framework and commercial
agreements with China Communications Construction Company Ltd, one of the world
leading companies involved in railway, high speed road, tunnel, bridge, and port
construction, to become the lead member of the development consortium. 
Feasibility study works commenced on  December 31, 2012.

The territory along the North-South Transport Corridor is endowed with
significant natural resources, which has already attracted a number of foreign
companies who have made major investments in the region.  Mr. Borkowski
indicated that, "Rasia and its consortium members will aim to boost potential
local and international transit freight volumes by investing in the development
of mineral and agricultural projects along the Corridor.  We have already held
early stage discussions with  China  state-owned enterprises regarding potential
joint venture investments in mineral and agricultural projects which will have
the effect of enhancing the economic appeal of the railway and road projects. 
There will be additional effort to seek the involvement of nations, and
companies, benefiting from the Corridor including  Russia,  Iran,  India  and
the countries of  Europe,  Central Asia, and the Gulf Cooperation Council
("GCC") in order to enhance regional trade relations."

Rasia also entered into a cooperation agreement with Hayah Resources, a global
natural resources investment group backed by ultra-high net worth families in
the GCC and Chaired by UAE businessman  H.E. Rashid Al Malik; this investment
group will focus on mineral investments along the Corridor and the development
of the railway and high speed road projects.   

The implementation of the projects is already marked by strong regional
cooperation.  Three separate Memoranda of Understanding were previously signed
between the respective Ministries in the Republic of  Armenia  and the  Islamic
Republic of Iran  related to the construction of a direct railway connection
between  Armenia  and Iran.  Rasia has recently entered into negotiations with
the Ministries for signing a new tripartite Memorandum of Understanding unifying
the efforts for developing direct railway communication between  Armenia  and 

During the announcement presentation, Mr.  Viktor Rebets, General Director,
South Caucasus Railway CJSC elaborated on the work already completed in  Armenia
 in support of a North-South Transport Corridor. Mr. Rebets stated "During the
period between 2008 and 2012, our investment program exceeded 90 billion drams
(US$225 million) which was allocated by Russian Railways OJSC. A massive
reconstruction program of railway infrastructure was implemented using these
funds including track and station facilities, systems of electrification and
power supply, communication, centralization and blocking."  

During this time, as a part of the infrastructure modernization program, more
than 300 km of track, 160 technological objects, 33 artificial structures, 130
km of contact network, and 140 km of power lines were repaired.  In 2012, 3
major railway bridges that were built in 1898 were commissioned including the
Zamanlinsky bridge, the Satanikamurj bridge, and the bridge on the
Kober-Tumanian span. Infrastructure improvements over the past 4 years have now
allowed for the increase of substantial traffic volumes.  Expansion of the
railway network of  Armenia  and increased mining activity in  Armenia  are
creating new jobs, economic growth, and increases in traffic volume.

South Caucasus Railway also has the capacity to operate the new Southern Armenia
Railway section for Rasia.  The company has created a strong base for the
maintenance and repair of locomotives and rolling stock, introduced modern
technologies for transportation process management, and improved the
qualifications of technical staff.  Construction of the Southern section of the
railway in  Armenia  and connection to the railway network of  Iran  will form a
new international transport corridor linking the countries of the Black Sea
region with the Persian Gulf countries and  India.

About the Parties

Rasia FZE  ("Rasia") and Rasia Group, Rasia Management LLC, Southern Armenia
Railway Pte Ltd., and Southern Armenia High Speed Road Pte Ltd. are members of
the "Rasia" group of investment and investment management companies based in 
Dubai, UAE, the  Cayman Islands,  Armenia  and Singapore.  Rasia is involved in
direct principal investments and investment management primarily in mining and
strategic infrastructure.

China Communications Construction Company Ltd  ("CCCC") is one of the world's
largest construction companies and international general contractors based in 
the People's Republic of China, specializing in planning and design, project
development, equipment procurement, trade, construction and facilities
management.  CCCC is one of the leading companies involved in railway, high
speed road, tunnel, bridge, and port construction worldwide.

South Caucasus Railway CJSC  ("SCR") is a 100% subsidiary of Russian Railways
OJSC and provides concession management of the existing railway system in
Armenia.  Armenian Railways CJSC was referred to the concession management of
SCR according to a Concession Agreement signed on  February 13, 2008.  The term
of the concession management is 30 years with possible extension for another 10
years. Currently South Caucasian Railway CJSC is a member of the International
Union of Railways (UIC), the International Rail Transport Committee (CIT), and
the Organization for Railways Cooperation (ORC) with the status of associated

For further information please contact by email:

Public Relations
Rasia FZE
Emirates Towers
Level 41
Sheikh  Zayed Road
Dubai, United Arab Emirates
P.O. Box 31303


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