Iranian Energy Minister Majid Namjoo announced March 14 that China's Sinohydro Corp. and the Farab Iran Co. signed a $2 billion contract to build the world's tallest concrete dam in the western province of Lorestan.

The 1,033-foot-high dam on the Bakhtiari River in the Zagros Mountains will hold the Islamic Republic's largest reservoir with a capacity of about 169 billion cubic feet of water.

The project "is one of the major events in the country's water sector," Namjoo declared after the signing in Tehran.

The Bakhtiari Dam will house six 250-megawatt turbines to provide a generating capacity of 1,500 gigawatts.

According to The Middle East Economic Digest, published in the United Arab Emirates, Iran has "23 operational hydropower plants … with a combined electricity generating capacity of 8.2GW.

"This represents 14 percent of the country's total generating capacity of 58.5GW.

"A further 4.8GW of capacity is under construction, 2GW of which, including Bakhtiari, is at an advanced stage of design, while 12.7GW of hydro capacity is either undergoing feasibility study or in the early design stage," the economic weekly reported.

The Bakhtiari project illustrates the delays in Iranian efforts to boost its generating capacity caused by the economic sanctions imposed by the U.N. Security Council, as well as the United States and European Union, last June.

Feasibility studies for the giant project were undertaken as far back as 1996 but the design effort didn't get going until 2005. The original contractor, a German firm, was abandoned in 2002.

Sinohydro and Faban took over the project in 2007, with Chinese banks providing the financing.

But plans to boost hydroelectric generating capacity from a combined total of 2GW in 2002 by 20 percent by the end of 2009 failed to materialize, blamed in large part on earlier U.S.-led international sanctions.

The much harsher sanctions imposed in 2010 made things even more difficult for Tehran.

These sanctions stemmed from Iran's refusal to abandon its contentious nuclear program, which the Americans and their allies allege masks a drive to develop nuclear weapons.

Tehran denies that and insists that it needs the technology to generate electrical power to meet a surging domestic demands caused by an expanding population and industrial requirements.

The sanctions are designed to undermine Iran's nuclear program but also seriously impede a whole range of energy projects such as the hydropower dams.

Difficulties in acquiring the equipment required for the dam projects have intensified.

"Projects have been pretty much limited to using Chinese manufacturers or trying to make parts locally," a consulting engineer said.

"This has slowed down a number of schemes … Nonetheless, they're moving forward.

"Sanctions have meant that projects won't necessarily have the best equipment installed and may take longer and cost more."

China is engaged in a global effort to acquire oil and natural gas supplies for its ever-expanding economy as well as raw materials, particularly in the Middle East and Africa.

State-owned enterprises in China, and other Asian states, refuse to shun the Iranian market and are less susceptible to pressure than Western companies.

The Iranian Water Resources management Co. says that construction work has begun on 17 dams since March 2010, with work scheduled to begin on another 120 between October 2010 and the end of 2011.

The first and second 250MW units of the Karun 4 dam on the Karun River, which has the highest discharge of all Iran's rivers, went online in December and January. When the 755-foot-high, double-arch dam in southwest Iran is completed, it will have a total generating capacity of 1GW.

Another major project under construction is the 2GW Upper Gotvand Dam in Khuzestan province. The 590-foot-high rockfill dam with a clay core will be Iran's tallest earthen dam. It will have four 250MW turbines with a generating capacity of 2GW that will go online in two stages.

MEED reported that a 1GW project in Mazandaran province, originally scheduled to be completed by 2008, is now more than 80 percent built.

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