A total of three hydropower plants are expected to be built on the Shala River in the north of Albania, an area known for its outstanding natural beauty and a popular tourist destination during the summer. Two of the plants are earmarked inside the boundaries of the Theth National Park.
Plant Dukagjin 1, 2, and 3 will be constructed through a concession between the Ministry of Economy and companies Interenergo Albania shpk, Poteza Skupina dd, and SGP Pomgrad dd. The concession was awarded in 2008 and lasts for 35 years; it was granted via an unsolicited proposal.
The company implementing the project is Shala Energy with the shareholders 3 Power Energy Group INC, Intenergo Albania, and Falak Properties.
Falak Properties appears to be a Dubai-based real estate company with director Abdul Rahman Falaknaz.
Also involved is Ekrem Lluka, the “Berlusconi of Kosovo” and president of the Dukagjini corporation. An influential businessman in Kosovo and close to former Prime Minister Ramush Haradinaj, his companies, have flourished due to many government contracts. It was also alleged he took a bribe to not submit a bid for a deal with Telecom Slovenia so that a competing consortium could be declared the winner, but no wrongdoing was ever pursued officially.
Interestingly, some other companies and individuals involved in the deal are from or incorporated in Slovenia.
According to the feasibility study published in 2009 and updated in 2013, the plants will generate an electrical output of around 321,465,632 kWh. At least two of them will be located in the Theth National Park, which is illegal. The other will be further downstream, impacting an area popular with boat trips and tourists during the summer months.
No work has started yet, believed by Bankwatch to have been due to “concessions speculations/and/or the lack of liquidity.” They suggested that the Falak company could inject money to meet the total of between EUR 144.6 million and EUR 210.9 million.
But it seems that a Chinese company, Gezhouba Group, could be set to finance the project, meaning the starting of work could be imminent.
A Framework Contract between Gezhouba Group, Irish Sala Energy Company, and Albania 3Power Shala Company on the Sala River Hydropower Station in the Republic of Albania was listed as an outcome from the February 2021 China CEEC summit.
Gezhouba Group is a construction and engineering company based in Wuhan, China. It is the 33rd largest contractor in terms of revenue globally, and a major shareholder is the state-owned China Gezhouba Group Corporation. The company has been involved in many overseas investments and has a track record in picking up overseas contracts in hydroelectric engineering, accounting for much of its portfolio.
It is also involved in many of China’s controversial One Belt, One Road projects, which have been accused of debt-trap diplomacy and using infrastructure to increase Beijing’s international power.
The Shala River flows from the Albanian Alps and has its source near the village of Theth. It feeds into the Komani Reservoir and stretches for 37km through the Shala valley. It is known for its crystalline water and for being rich in wildlife, including freshwater trout. It is often described as a “secret paradise” and a “pearl of the beauties of Koman and Albania.”
The Theth National Park, where two of the plants would be situated, covers 26.3km of mountain and valley. It was established to protect the unique biodiversity and ecosystems that exist there and forests, waterfalls, rivers, and mountains. It has been designated as a Category II by the International Union for Conservation of Nature and an Important Bird and Plant Area. It is also a Protected Historic Centre.
It is home to rare species of flora and large mammals such as brown bear, roe dear, grey wolf, lynx, wild goat, golden eagles, lesser kestrels, and the rock partridge.
