Jordan's $2.1bn Attarat oil shale plant ran into ICC arbitration over its tariff

Attarat was Jordan's dream of energy independence: burn the kingdom's vast oil shale deposits instead of imported fuel. In 2012 the Attarat Power Company proposed a plant supplying 15% of national electricity; the PPA was signed in 2014 at an estimated cost of $2.1bn for a 470MW station about 110km southeast of Amman. When no Western or Asian investor would fund the unproven concept, Chinese banks offered more than $1.6bn in loans in 2017, and China's Guangdong Energy Group bought a 45% stake — by the company's account, the largest private Belt and Road enterprise outside China.

The fatal overlap: in the very year Jordan signed the oil shale PPA, it also struck a $15bn deal to import cheaper natural gas from Israel. The plant's economics collapsed on paper before construction began — the treasury estimated the contract's tariff would lose the state $280m a year, and covering the payments would have required raising consumer electricity prices by 17%. Interest waned, construction only started in mid-2017, and the grid connection promised for May 2020 slipped.

In 2020 Jordan's Ministry of Energy took the project to ICC arbitration in Paris, alleging the tariff rested on gross unfairness — NEPCO, the state buyer, sought a ruling on the deception's value and its right to terminate the contract. Hearings were still running in June 2023. By then the first 235MW unit had entered commercial operation in October 2022 and the second in May 2023 — about three years behind the promise, with ownership split between Guangdong Energy (45%), Malaysia's YTL Power (45%) and Estonia's Eesti Energia (10%).

A 30-year take-or-pay deal the treasury said would lose Jordan $280m a year — $8.4bn over the term; full commissioning arrived three years late

The PPA priced oil shale as baseload saviour before cheaper pipeline gas upended the market; Jordan was simultaneously long gas and long shale.

There was no competitive tension: after the project was pitched worldwide and nobody bit, the government accepted the only offer and its tariff.

Take-or-pay volumes stripped the state buyer of flexibility — NEPCO's losses were contractual, not operational.

Chinese project finance turned a stalled white elephant into a 30-year payment obligation owed to a state-adjacent creditor.

A take-or-pay contract priced against hoped-for demand dies when cheaper supply arrives. Jordan locked in oil shale in 2014, signed for cheaper gas the same year, and fought the bill for a decade.

The plant now supplies roughly 15% of Jordan's electricity and, as an engineering machine, works: it hit the PPA's 80% availability requirement with 3,888 GWh of gross generation over its first two contract years and won a POWER Top Plant award in 2024. The contract is what failed — the ICC case was still pending as of mid-2023, with Attarat Power expecting a binding decision that year, and the treasury's $280m-a-year arithmetic hanging over every hearing. Jordan keeps importing Israeli gas while paying for shale power it did not want at the price it cannot afford.