Samra Electric Power Company
Transcript of Samra Electric Power Company
Annual Report2010
The Hashemite Kingdom of Jordan
Samra Electric Power Company
H.M King Abdullah the Second Bin Al-Hussein
H.R.H.Prince Hussein Bin Abdullah the Second
Board of Directors
Directors
Managing Director
ChairmanH.E. Dr. Mahir Madadhah
Vice-Chairman H.E. Eng. Mohammed Arsalan
H.E. Eng. Amjad Al-Rawashdeh
H.E. Dr. Ismael Zaglol
H.E. Mrs. Dina Al Dabbas
Eng. Marwan Bqa’een
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SAMRA ELECTRIC POWER COMPANY
No. Table of Contents Page1 Chairman’s Message 132 Managing Director’s Message 143 About Us 154 Activities and Accomplishments 175 Electric Energy Demand and SEPCO’s Contribution in 2010 196 Organizational Structure 207 Manpower and Training 218 Significant Statistics in 2010 249 Performance Indicators in 2010 2510 Electricity Sales in 2010 2611 Jordan and the Interconnected Electrical System Load (2010, 2009) 2712 Interconnected Electrical System Peak Load Curve (2010-2009) 2713 Minimum, (Morning and Evening) Peak Loads for the Interconnected
Electrical System in (2010-2009)29
14 Generated and Imported Electric Energy in the Kingdom in 2010 3115 SEPCO’s Electricity Tariff 3216 Electricity Tariff in the Hashemite Kingdom of Jordan 3317 Financial Performance 34-3518 Future Plans 3619 Financial Statements and Auditor’s Report for 2010 37
Measures & Abbreviations:
M.W. Megawatt = One Thousand Kilowatt
K.W.H Kilowatt Hour
M.W.H Megawatt Hour = One Thousand Kilowatt Hour
G.W.H. Gigawatt Hour = One Million Kilowatt Hour
MMBTU Million British Thermal Unit
HHV High Heating Value
CC Combined Cycle
SC Simple Cycle
ISO International Organization for Standardization
OHSAS Occupational health & safety Assessment Series
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SAMRA ELECTRIC POWER COMPANY
Our Vision:To produce electric power to the satisfaction of the consumer.
Our Mission:To produce electric power according to the highest standards with high availability and reliability at the lowest cost using state-of-the-art and environment friendly techniques and to interact with the local community.
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SAMRA ELECTRIC POWER COMPANY
Chairman of the Board of DirectorsDr. Maher Madadhah
Chairman’s Message
The significance of Samra Electric Power Company (SEPCO) stems from the importance of its development role in supplying the Jordanian electrical system with approximately one third of the required electric power for domestic consumption, and the various economic sectors consumption. This role helps enhance the targeted economic development process and encounter the various purposes of demand increase
The management gave utmost attention to development and maintenance the Company readiness and upgrading its technical level, as well as preparing its staff to enhance the developments in the energy sector in general, and in electricity generation in particular. The Company was also keen to enhance performance, and keep abreast of excellence requirements according to the international best practices by means of reconstructing and promoting its institutional capabilities, and adopting strategic planning concept to be able to realize the developed plans and targets.
I am honored to be in charge of this great economic facility. I would like to thank my colleagues in the board of directors and the staff of the Company for their ever concern for the Company to be one of the leading companies in the energy sector in our beloved country under the leadership of His Majesty King Abdullah II Bin Hussein.
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SAMRA ELECTRIC POWER COMPANY
Managing DirectorEng. Amjad Al-Rawashdeh
Managing Director’s Message
Since its establishment, SEPCO take a leading role by feeding the electrical system with the required energy according to the highest international standards and measures. In addition, the Company executed plants construction projects to meet the increased electric loads and demand for electric power and to serve the national economy according to the policies of the prudent government in this respect.
The Simple Cycle Project, Phase III, was completed with a capacity of 285 MW, thereby increasing the overall generating power to 900 MW, accounting for 35% of Jordan overall load. In addition, the Company announced the bid of the Combined Cycle Project, Phase III, for adding a steam generating turbine with an approximate capacity of 140 MW. The Project aims to promote efficiency by making use of the hot gases stemming from the Gas turbine exhausts which also reduces greenhouse gases in line with the international standards and preserve the surrounding environment. By completing this project, which is set to be commercially operational in summer 2013 to meet the electrical system requirements, the overall generating capacity produced by the Company will be increased to 1040 MW.
On the other hand, the Company, based on a clear vision, aims to dedicate adequate attention to developing and training its employees and applying modern management criteria to ensure enhancing production and excellence in the electrical sector which experiences intensive development and expansion.
The Company continues to support and communicate with the local community institutions and participate in the activities that promote communication and reflect positively on the community.
Finally, on the occasion of releasing the annual report of the Company for 2010, I have the pleasure to extend my gratitude to H.E. the Chairman, and the members of the Board of Directors for their substantial role in the accomplishments achieved by the Company. Moreover, I would like to express my appreciation to the employees of the Company for their dedicated efforts.
In the meanwhile, I ask God to guide us to serve our country under the leadership of His Majesty King Abdullah II Bin Hussein.
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SAMRA ELECTRIC POWER COMPANY
About Us
• Establishment of the Company
Samra Electric Power Company (SEPCO) was established by the government of the Hashemite Kingdom of Jordan pursuant to the provisions of the Companies Act No. 22 of 1997 and in implementation of the Cabinet Resolution taken in its session held on 26/8/2003, authenticated by the letter of HE Prime Minister number 58/11/02/13075 dated 27/8/2003, instructing the establishment of a company to be in charge of generating electric power in conjunction with the Central Electricity Generating Company, and any other companies incorporated subsequently. SEPCO is wholly owned by the government with a capital of Fifty Million Jordanian Dinars.
The Company was registered with the General Companies Controller on 21/4/2009 under number 40 for generating electric energy of high quality and availability at the lowest cost possible.
• Company Locations:
Head Office:
Um Al-Sumaq, Za’al Abu Tayeh Street
Opposite to Petroleum National Company
P.O. Box 1885, Postal Code: 11821
Tel.: +96265506510 Fax: +96265506520
Plant Location:
35 Km North East of Amman
Zarqa- Al-Hashimieh
Tel.: +962 5 3901360 Fax: +962 5 3901370
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Electric Power Generating Units in SEPCO:
Unit Nominal Capacity Commercial Operation Date
First Gas Turbine 100 MW 1/11/2005
Second Gas Turbine 100 MW 11/2/2006
First Steam Turbine 100 MW 8/10/2006
Third Gas Turbine 100 MW 13/12/2007
Fourth Gas Turbine 100 MW 5/7/2008
Second Steam Turbine 100 MW 2/8/2010
Fifth Gas Turbine 142.5 MW Due in the first quarter of 2011
Sixth Gas Turbine 142.5 MW Due in the first quarter of 2011
Total 885 MW
Main Control Room
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SAMRA ELECTRIC POWER COMPANY
Activities and Accomplishments
Investment Projects:
Converting Simple Cycle Project- Phase II to Combined Cycle, Bid No. 12/2007:
The project is for converting the third and fourth gas turbines currently operating as simple cycle to combined cycle by adding steam turbine with its auxiliaries of a nominal capacity of 100 MW, and steam generators that use the heat energy of the exhaust gases emanating from the two gas turbines.
The project aims to increase the generating capacity of the Company, thus enhancing efficiency and improving environment impact by reducing relative emission of greenhouse gases. This plant was commercially operational on 2/8/2010.
The project was awarded to the Chinese SEPCO III Company on 13/8/2008. The period of performing the bid was 22 months, at a cost of 100 Million Jordanian Dinars.
Simple Cycle Project, Phase III
The project consists of adding the fifth and sixth gas turbines produced by ALSTOM Company with a nominal capacity of 142.5 MW each, and two diesel tanks with storage capacity of 14000 m3 each.
These two turbines are set to be commercially operational in the first quarter of 2011. The cost of the project is about JOD 135 Million.
The project aims to increase the generating capacity of the Company to cover the increase in electric energy consumption.
Maintenance of the Operating Turbines:
Maintenance Type Turbine Date
Combustion Inspection First gas turbine 20/11/2010-29/11/2010
Hot Gas Path Inspection Second gas turbine 29/11/2010-14/12/2010
The manufacturer Company GE inspected the generators of the first and second gas turbines. The insulating materials between the coils in the fixed organ of the second gas turbine will be changed.
Quality and Excellence:
The Company is in the process of obtaining the following quality and excellence certifications:
- Quality Management Certification ISO 9001
- OHSAS 18001
- Environment Management ISO 14001
The gab analysis phase was completed and the procedures to be verified by SGS are implemented for practicing its activity.
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SAMRA ELECTRIC POWER COMPANY
Environment and Occupational Health and Safety
The Company is committed to adhere to the performance standards set out in its license granted by the Regulating Authority of Electricity Sector, as well as the rules and regulations applicable in Jordan in terms of environment and heath. This is achieved through disposing of exhausts emanating from the plant, including oil and water, by adopting zero discharge principle.
The Company is concerned with providing prevention and safety systems and a safe work environment by supplying the required prevention and safety equipment that are necessary for the safe performance of work by employees.
Compained Cycle Project - Phase II
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SAMRA ELECTRIC POWER COMPANY
Electric Energy Demand and SEPCO’s Contribution in 2010
The peak load of the interconnected electrical system for 2010 reached 2650 MW, compared to 2300 MW in 2009, with a growth rate of 15.21% against 3.14% in 2009. The peak load for the electrical system in the Kingdom in 2010 reached 2670 MW, against 2320 MW in 2009, with a growth rate of 15.08 % against 2.65% in 2009.
The volume of generated energy in 2010 in the interconnected electrical system totaled 15,258.1 GWH compared to 14,450 GWH in 2009. The Company contributed by 22.7% of the total electric energy generated, compared to 25.11% in 2009, while the Central Electricity Generating Company contributed by 50.17%, compared to 55.42% in 2009. Al-Manakher Company contributed by 21.54%, compared to 16.26%. Al-Qatrana Company contribution amounted to 0.35%.
The quantity of energy imported from the Egyptian and Syrian networks amounted to 670.1 GWH in 2010, compared to 383 GWH in 2009.
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SAMRA ELECTRIC POWER COMPANY
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ManpowerThe number of the employees of the Company amounted to (273) as at 31/12/2010 distributed according to the following table:
Position No. of Employees Percentage
High Level Management 7 2.6%
Technical Management 22 8.1%
Financial and Administrative Management 52 19%
Power Plant Management 178 65.2%
Phase III Project 14 5.1%
Total 273 100%
b. Employees are distributed according to their academic qualifications:
Qualification No. Percentage
PH Degree 1 0.37%
MA Degree 3 1.1%
BA Degree 92 33.7%
Diploma 95 34.8%
High School Certificate or below 82 30.03%
Total 273 100%
c. Training for Employment Purposes:
The number of trainees within the training program for employment purposes in the Company amounted to 12 trainee engineers and technicians, including 6 engineers.
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The
posi
tion
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part
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ts o
f the
em
ploy
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in th
e Co
mpa
ny a
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31/
12/2
010
Managing Director
Advisor
Head of Management.
Dept. Manager
Tenders Secretary
Head of Section
Engineer
Supervisor
Technician
Programmer
Nurse+ Assistant Pharmacist
Accountant+ Treasurer + Auditor
Administrative Supervisor + Administrative+ Data Entry
Typist / Secretary
Support services
Store Keeper
Total
Seni
or
Man
agem
ent
11
-1
1-
--
--
-2
-1
--
7
Tech
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anag
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--
4-
32
-1
--
-4
31
422
Fina
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A
dmin
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anag
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t-
--
3-
71
-3
52
88
411
-52
Plan
t M
anag
emen
t-
-1
3-
725
510
61
--
51
24-
178
Phas
e III
Pro
ject
--
--
-1
6-
5-
--
11
--
14
Tota
l1
11
111
1834
511
56
210
1810
364
273
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TrainingTraining of the Company Employees
Since its establishment, the Company was concerned with human resources since they are the cornerstone of production. In view of the importance of training, the Company considers this aspect by involving its employees in training programs that included all categories of employees. In 2010, the employees participated in 18 training conferences and programs as follows:
Course/Lecture
Renewable Energy Technologies
Loop Automation
National Efficiency Plan For Regional Energy Challenges
3M Conference for Electrical Products
Power Transformers Explosion Protection
Level Measurement in the Primaries
The Environmental Impact of Electromagnetic Fields of Non-Ionizing Radiation
Electric Power Quality
Measurements of Environmental Emissions
Man Diesel Technology and there Power Generation
Strategic Financial Planning
International Insurance Diploma
Audit and Internal Control Policies
Journalism Writing
Training of Trainers
Contingency Planning
Health Insurance Course
English Language Course
Involvement in the Local Community:
Based on the Company belief in its role in the local community, supporting education, and providing fresh graduates with the experience they need for employment, 39 engineers and 6 college students were trained in 2010 according to the following table:
Category No.
Engineers from the Engineers Association 11
Training engineers for graduation purposes 28
Training community college students for graduation purposes. 6
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Significant Statistics in 20102010 2009
Peak Load of the Electrical System (MW) 2650 2300
Total Generated Energy (GWH) 2,348.697 PHASE I1,107.931 PHASE II
2526.22(CC)1102.824(SC)
Internally consumed energy in the power plant (MWH) 54,248 PHASE I18,421 PHASE II
54,831(CC)9,714(SC)
Percentage of the internally consumed energy in the power plant (%)
2.14 1.81
Sent out energy to the National Electric Power Company (400 KV) (GWH)
2,294.191 PHASE I1,089.510 PHASE II
2471.124(CC)1093.11(SC)
Consumed energy for substation of the National Electric Power Company (6.6 KV) (MWH)
277.11 264.42
Diesel Consumption (Cubic Meter) 40084.100 PHASE I482.800 PHASE II
385.076(CC)78.447(SC)
Total value of diesel (Thousand Dinars) 18627 PHASE I206.749 PHASE II
138.687 (CC)28.253 (SC)
Natural gas consumption (MBTU) 16729020.98 PHASE I10974491.33 PHASE II
19782219.084(CC)13946541.564(SC)
Overall Generated Efficiency - CC/Phase I * (%) 44.06 43.54 (CC)
Overall Generated Efficiency /Phase II * (%) 31.79 26.98 (SC)
Overall Sent out Efficiency - CC/Phase I * (%) 43.03 42.59 (CC)
Overall Sent out Efficiency /Phase II * (%) 31.49 26.74 (SC)
Generated Average Heat Rate (BTU/KWH) * 7710 PHASE I10997 PHASE II
7836(CC)12646(SC)
Sent out Average Heat Rate (BTU/KWH) * 7895 PHASE I11132 PHASE II
8010 (CC)12761 (SC)
* (HHV) : High Heating Value
Phase I: (GT1, GT2, ST1)
Phase II: (GT3, GT4, ST2). The second steam turbine was commercially operational on 2/8/2010
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Performance Indicators in 2010
Technical Performance 2010 2009
Generated Efficiency “CC/Phase I” * % 44.6 43.54
Sent out Efficiency “CC /Phase I” * % 43.03 42.59
Generated Efficiency “Phase II” * % 31.79 26.98
Sent out Efficiency “Phase II” * % 31.49 26.74
Availability of Gas Turbine Number One (GT1) % 94.1 94.1
Availability of Gas Turbine Number Two (GT2) % 89.9 93.7
Availability of Steam Turbine Number One (ST1) % 95.4 89.3
Availability of Gas Turbine Number Three (GT3) % 93.5 92.6
Availability of Gas Turbine Number Four (GT4) % 99.5 95.6
Percentage of Internally Consumed Energy % 2.14 1.81
Manpower Indicators
Annual Productivity (GWH/Employee) 12.661 14.17
Total availability of the Units of Samra Electric Power Plant amounted to 94.507% in 2010
* HHV High Heating Value
Availability of Samra Power Plant Units (2008-2010)
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Electricity Sales in 2010SEPCO’s electricity sales amounted to 3,393.962 GWH in 2010, against 3,564.498 GWH in 2009, with a decrease of 4.78%. The Company sales of phase I amounted to 2,294.468 GWH, while the sales of the phase II amounted to 1,089.510 GWH. The volume of pre-commercial operation energy sent out to the network from the fifth gas turbine amounted to 9.984 GWH, due to the operation mode of the National Electric Power Company.
Simple Cycle Project - Phase III
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SAMRA ELECTRIC POWER COMPANY
Jordan & Interconnected Electrical System Loads Development of the peak load (MW) 2010 2009
Central Electricity Company 1507 1439
Samra Electric Power Company 552 501
Al-Manakher Company / Eastern Amman 371 254
Other companies in the electrical system 15 15
Electricity imported from Egypt and Syria 205 91
Interconnected electrical system 2650 2300
Growth rate % 15.21 3.14
Other companies outside the electrical system 20 20
Kingdom loads 2670 2320
Growth rate % 15.08 2.65
Peak Load of the Interconnected Electrical System Curve (2010-2009)
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Min
imum
, (M
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nd E
veni
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Load
s (M
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Min
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date
tim
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date
tim
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date
tim
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GE
VE
NIN
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Jan
1130
2010
/01/
1803
:30
2180
2010
/01/
2612
:00
2250
2010
/01/
2717
:40
Feb
1060
2010
/02/
1907
:00
2190
2010
/02/
0414
:00
2290
2010
/02/
0817
:50
Mar
1075
2010
/03/
2607
:00
2060
2010
/03/
0112
:00
2200
2010
/03/
0118
:10
Apr
1090
2010
/04/
0207
:00
1900
2010
/04/
2714
:00
1990
2010
/04/
2019
:50
May
1080
2010
/05/
0106
:00
2220
2010
/05/
1714
:25
2150
2010
/05/
1719
:50
Jun
1200
2010
/06/
1107
:00
2400
2010
/06/
2213
:00
2200
2010
/06/
2120
:40
Jul
1300
2010
/07/
0207
:00
2475
2010
/07/
1114
:00
2350
2010
/07/
3120
:20
Aug
1392
2010
/08/
2706
:30
2650
2010
/08/
0313
:00
2460
2010
/08/
0320
:20
Sep
1200
2010
/09/
1107
:00
2350
2010
/09/
2613
:30
2300
2010
/09/
2519
:20
Oct
1190
2010
/10/
0807
:00
2300
2010
/10/
0414
:30
2230
2010
/10/
0319
:00
Nov
1040
2010
/11/
1706
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1880
2010
/11/
1113
:00
2100
2010
/11/
3017
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Dec
1140
2010
/12/
0307
:00
2310
2010
/12/
1312
:00
2390
2010
/12/
1317
:00
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SAMRA ELECTRIC POWER COMPANY
Min
imum
, (M
orni
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Load
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Min
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date
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date
tim
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date
tim
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DM
OR
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GE
VE
NIN
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Jan
1090
2009
/01/
3007
:00
2070
2009
/01/
0412
:00
2220
2009
/01/
0418
:00
Feb
1080
2009
/02/
2104
:00
2050
2009
/02/
2112
:00
2120
2009
/02/
1718
:00
Mar
1035
2009
/03/
1306
:00
2100
2009
/03/
0112
:00
2120
2009
/03/
0418
:20
Apr
1030
2009
/04/
0307
:00
1770
2009
/04/
1812
:00
1930
2009
/04/
0119
:40
May
1060
2009
/05/
0806
:00
2000
2009
/05/
1813
:00
2000
2009
/05/
1820
:00
Jun
1200
2009
/06/
0507
:00
2190
2009
/06/
3014
:00
2035
2009
/06/
3020
:30
Jul
1225
2009
/07/
1707
:00
2300
2009
/07/
2914
:00
2130
2009
/07/
2820
:30
Aug
1240
2009
/08/
2807
:00
2280
2009
/08/
0514
:00
2180
2009
/08/
1920
:00
Sep
1035
2009
/09/
2107
:00
1940
2009
/09/
0313
:00
1960
2009
/09/
1221
:10
Oct
1110
2009
/10/
0207
:00
2050
2009
/10/
2014
:00
2100
2009
/10/
2018
:30
Nov
1005
2009
/11/
2907
:00
1950
2009
/11/
0314
:00
2140
2009
/11/
1817
:20
Dec
1060
2009
/12/
0504
:00
2040
2009
/12/
3012
:00
2200
2009
/12/
0917
:10
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SAMRA ELECTRIC POWER COMPANY
Minimum, (Morning and Evening) Peak Loads for the Interconnected Electrical System in 2010
Minimum, (Morning and Evening) Peak Loads for the Interconnected Electrical System in 2009
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SAMRA ELECTRIC POWER COMPANY
Generated and Imported Electric Energy
in the Kingdom (GWH)
2010 2009
a. Interconnected electrical system
Central Electricity Company 7655 8009
Samra Electric Power Company 3467 3629
Al-Manakher Company AES/ Eastern Amman 3287 2350
Al-Qatarneh 54 0.0
King Talal Dam 15 14
Arab Potash Company 35 0
Jordan Cement Factories Company 0 0
Indo-Jordan Chemical Company 66 58
Jordan Biogas Company 9 7
Imported energy (Egyptian and Syrian networks) 670.1 383
Generated and imported electric energy in the interconnected electrical system 15258.1 14450
Annual Growth Percentage (%) 5.59 1.926
b. Other major industrial companies 190 205
Total generated energy in the Kingdom 15448.1 14655
Annual Growth Percentage (%) 5.41 1.877
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SAMRA ELECTRIC POWER COMPANY
SEPCO’s Electricity TariffThe capacity principle was adopted in calculating the electricity tariff of the generating plants of SEPCO which comprises the following:
1. Partial Amortization of the Project.
2. Fixed Operation and Maintenance Expenses.
3. Administrative Expenses and Salaries.
4. Variable Operation and Maintenance Expenses.
33
SAMRA ELECTRIC POWER COMPANY
Electricity Tariff Applicable in the Hashemite Kingdom of Jordan
From 16/1/2010From 1/1/2009From 14/3/2008First: Bulk Supply
Until 15/1/2010Until 31/12/2008a. Jordanian Electric Power Company JEPCO
2.982.98 2.98 1- Peak load (JD/KW/Month)46.6745.81 45.81 2- Day Load (Fils/KWh) 36.6235.76 35.76 3- Night Load (Fils/KWh)
B. Electricity Distribution Company EDCO2.982.98 2.98 1- Peak load (JD/KW/Month)
35.8636.15 37.35 2- Day Load (Fils/KWh) 25.8126.10 27.30 3- Night Load (Fils/KWh)
C. Irbid Governorate Electricity Company IDECO2.982.98 2.98 1- Peak load (JD/KW/Month)
39.0938.16 38.16 2- Morning load (Fils/KWh)29.0428.11 28.11 3- Evening load (Fils/KWh)
D. Large Industries2.982.98 2.98 1- Peak load (JD/KW/Month)
66.0065.00 65.00 2- Day Load (Fils/KWh)50.0049.00 49.00 3- Night Load (Fils/KWh)
Second: Retail TariffA. Ordinary Subscribers Tariff Domestic (Fils/kwh)1. First Block
33.0032.00 32.00 From 1-160 KWh monthly (Fils/KWh)2. Second Block
72.0071.00 71.00 From 161-300 KWh monthly (Fils/KWh)3. Third Block
86.0085.00 85.00 From 301-500 KWh monthly (Fils/KWh)4. Fourth Block
114.00113.00 113.00 More than 500 KWh monthly (Fils/KWh)87.0086.00 86.00 B. Broad Casting stations and TV Flat Rate Tariff (Fils/KWh)87.0086.00 86.00 C. Commercial (Fils/KWh)50.0049.00 49.00 D. Small Industrial Tariff (Fils/KWh)
E. Medium Industries3.793.79 3.79 1- Peak load (JD/KW/Month)
47.0046.00 46.00 2- Day Load (Fils/KWh) 37.0036.00 36.00 3- Night Load (Fils/KWh) 48.0047.00 47.00 F. Agriculture (Fils/KWh) Flat Rate Tariff or
3.793.79 3.79 1- Peak load (JD/KW/Month)47.0046.00 46.00 2- Day Load (Fils/KWh) 37.0036.00 36.00 3- Night Load (Fils/KWh) 42.0041.00 41.00 G. Water Pumping (Fils/KWh)87.0086.00 86.00 H. Hotels (Fils/KWh) **
3.793.79 3.79 1- Peak load (JD/KW/Month)82.0081.00 81.00 2-.Day Load (Fils/KWh) 71.0070.00 70.00 3- Night Load (Fils/KWh) 52.0051.00 51.00 I. Street lighting *82.0081.00 81.00 J. Jordan Armed Forces (Fils/KWh)59.0058.00 58.00 K. Ports Corporation (Fils/KWh)
Remark:Monthly Minimum Charge
One JDOne JDOne JDa. Domestic ConsumersJD 1.25 JD 1.25 JD 1.25 b. Other Consumers
** Five or four star hotels may choose between the three rate tariff or continue using the flat rate tariiff
34
SAMRA ELECTRIC POWER COMPANY
Loans:
A. Combined Cycle Project-Phase II Loans:
The company signed loans agreement with the Arab Fund for Economic and Social Development to finance the expansion of Phase II detailed as follows:
Loan No. Lender Loan Value/Foreign Currency
Loan Value/Local Currency
524 Arab Fund KWD 30 Million JOD 75 Million
542 Arab Fund KWD 6 Million JOD 15 Million
B. Simple Cycle Project - Phase III Loans:
- The company signed loans agreement with lenders as below to finance the expansion of Phase II :
Loan No. Lender Loan Value/Foreign Currency
Loan Value/Local Currency
542 Arab Fund KWD 24 Million JOD 60 Million
802 Kuwait Fund KWD 15 Million JOD 37.5 Million
20/518 Saudi Fund SAR 193 Million JOD 36.5 Million
- To complete the finance of Phase III simple cycle, the company takes an additional loan from Kuwaiti fund will be activated in 2011 with 3.5 KWD Million equivalents to JOD 8 Million.
35
SAMRA ELECTRIC POWER COMPANY
Insurance:
SEPCO is experiencing a significant expansion in the value of its assets, liabilities, capabilities and cadres. This expansion is progressive in line with the responsibility undertaken by the Company in the electricity sector which the Company forms one of its fundamental units.
SEPCO maintains insurance in respect of its production assets and imports. In addition, the Company maintains life insurance in respect of its employees on annual basis. The insurance covers maintained by the Company are as follows:
1. All risks insurance policy.
2. Equipment damage insurance policy.
3. Civil liability insurance policy.
4. Maritime insurance policy.
5. Life and personal accidents insurance policy.
6. Insurance in respect of the vehicles of the Company
A comprehensive field survey is conducted on a regular basis by SEPCO’s Insurance Department in respect of the assets and liabilities of the Company, whether in the plant or the main offices of the Company, in coordination with the locally approved insurance companies and the international reinsurance companies’ experts. The survey aims to monitor the latest global developments in the field of insurance with respect to public safety and security precautions procedures adopted worldwide in power plants to be applied by SEPCO. In 2010, a field survey was conducted twice in respect of SEPCO assets in order to reevaluate the risks in the plant and monitor the application of public safety procedures and compliance with the highest international insurance specifications.
36
SAMRA ELECTRIC POWER COMPANY
Future Plans
• Managing the production of electric power that is both availability and of high quality, and selling it to the National Electric Power Company.
• Completing Phase III Project so that the two gas turbines are commercially operated by the Simply Cycle System, and expanding Phase III to operate by the Combined Cycle system with a view to increasing the generating capacity.
• Automating the archive system.
• Enhancing the capacity of the employees by involving them in training courses and activating the incentive system to encourage the employees to develop their capacities and skills in the best interest of work.
• Completing Phase I and Phase II of the clean development mechanism project.
• Completing the procedures of obtaining the ISO certifications in terms of quality management, safety management, occupational health and environment management.
• Performing any work assigned to the Company by the Council of Ministers.
37
SAMRA ELECTRIC POWER COMPANY
SAMRA ELECTRIC POWER COMPANY
(PRIVATE SHAREHOLDING COMPANY)
FINANCIAL STATEMENTS
AND INDEPENDENT AUDITOR’S REPORTFOR THE YEAR ENDED DECEMBER 31, 2010
39
SAMRA ELECTRIC POWER COMPANY
SAMRA ELECTRIC POWER COMPANY(PRIVATE SHAREHOLDING COMPANY)
FINANCIAL STATEMENTS AND INDEPENDENT AUDITOR’S REPORT
FOR THE YEAR ENDED DECEMBER 31, 2010
INDEX PAGE
Independent certified public accountants› report 40
Statement of financial position 41
Statement of comprehensive income 42
Statement of changes in owners’ equity 43
Statement of cash flows 44
Notes to the financial statements 45-60
40
SAMRA ELECTRIC POWER COMPANY
105180924
Independent Auditor's Report
To Messrs Board of directors Samra Electric Power Generating Company Private Shareholding Company Amman - �e Hashemite Kingdom of Jordan Report on the Financial Statements We have audited the accompanying �nancial statements of (Private Shareholding Company ) , which comprise the statement of �nancial position as at December 31, 2010 , and the statement of comprehensive income , statement of changes in equity and statement of cash �ows for the year then ended, and a summary of signi�cant accounting policies and other explanatory notes. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these �nancial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of �nancial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility Our responsibility is to express an opinion on these �nancial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. �ose standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the �nancial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the �nancial statements. �e procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the �nancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the �nancial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the e�ectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the �nancial statements. We believe that the audit evidence we have obtained is su�cient and appropriate to provide a basis for our audit opinion.
Opinion In our opinion, the �nancial statements present fairly, in all material respects, the �nancial position of Samra Electric Power Generating Company (Private Shareholdi ng Company), as at December 31, 2010, and its �nancial performance and its cash �ows for the year then ended in accordance with International Financial Reporting Standards . Other matters
�e �nancial statements of the Company for the year ended December 31, 2009 were audited by another auditor who expressed an unquali�ed opinion on March 2, 2010.
As stated in the statement of comprehensive income, exchange di�erences losses amounted to JD 9,740,505 for the year ended December 31, 2010.
Talal A bu -Ghazaleh & Co. International Husni Ilay an (License # 763) Amman , April 13, 2011
Opinion In our opinion, the �nancial statements present fairly, in all material respects, the �nancial position of Samra Electric Power Generating Company (Private Shareholdi ng Company), as at December 31, 2010, and its �nancial performance and its cash �ows for the year then ended in accordance with International Financial Reporting Standards . Other matters
�e �nancial statements of the Company for the year ended December 31, 2009 were audited by another auditor who expressed an unquali�ed opinion on March 2, 2010.
As stated in the statement of comprehensive income, exchange di�erences losses amounted to JD 9,740,505 for the year ended December 31, 2010.
Talal A bu -Ghazaleh & Co. International Husni Ilay an (License # 763) Amman , April 13, 2011
41
SAMRA ELECTRIC POWER COMPANY
Private Shareholding Company
Amman - �e Hashemite Kingdom of Jordan
1
S tatement of �nancial position as at December 31, 2010 ASSETS Notes 2010 2009
Non-current Assets JD JD
Property, plant and equipment 3 402,760,251 233,458,651
Employees housing fund loan 350,000 250,000
Total Non-current Assets 403,110,251 233,708,651
Current Assets
Warehouses 4 17,714,558 14,222,150
Other debit balances 5 1,842,681 29,502,555
National Electric Power Company receivable 6 18,565,351 4,597,405
Cash and cash equivalents 7 580,861 74,000
Total Current Assets 38,703,451 48,396,110
TOTAL ASSETS 441,813,702 282,104,761
EQUITY AND LIABILITIES
Equity
Authorized and paid-in capital of (51) millions shares
at JD 1 par value each 8 51,000,000 50,000,000
Governmental grants and donations 8 - 1,000,000
Statutory reserve 2,128,161 2,128,161
Voluntary reserve 4,256,322 4,256,322
Retained earnings 1,279,617 5,507,775
Total Equity 58,664,100 62,892,258
Liabilities
Non-current Liabilities
End of service indemnity provision 9 163,491 141,671
Loans payable 10 342,956,132 168,194,808
Total Non-current Liabilities 343,119,623 168,336,479
Current Liabilities
Income tax provision 11 695,009 2,145,853
Other credit balances 12 3,735,698 1,973,477
Contractors retention 23,937,224 9,172,182
Accounts payable 13 3,747,971 12,623,157
Due to banks 14 18,166 - Loans payable - current portion 10 7,895,911 24,961,355
Total Current Liabilities 40,029,979 50,876,024
Total Liabilities 383,149,602 219,212,503
TOTAL EQUITY AND LIABILITIES 441,813,702 282,104,761
42
SAMRA ELECTRIC POWER COMPANY
Private Shareholding Company
Amman - �e Hashemite Kingdom of Jordan
2
Statement of comprehensive income for the year ended December 31, 2010
Notes 2010 2009
JD JD
Energy revenues 31,669,573 27,637,798
Station operation and maintenance cost 15 (1,201,640) (2,859,851)Depreciation (12,637,950) (10,557,099)Administrative and operating expenses 16 (1,602,315) (1,344,873)Salaries, wages and other bene�ts 17 (2,706,120) (2,503,160)
Operating pro�t 13,521,548 10,372,815
Other income 18 1,341,120 662,671
Doubtful receivable expense - (985,015)Financing costs 19 (8,610,005) (7,104,147)
Pro�t before loans payable exchange di�erences and tax 6,252,663 2,946,324
(Losses) gains on loans payable exchange di�erences (9,740,505) 5,980,608
(Loss) pro�t before tax (3,487,842) 8,926,932
Income tax for the year 11 (740,316) (604,088)Income tax for prior years - (1,271,506)
(Loss) pro�t (4,228,158) 7,051,338
43
SAMRA ELECTRIC POWER COMPANY
Am
man - �
e Hashem
ite Kingdom
of Jordan
3
Statement of cha
nges in equity for the year ended
Decem
ber 31, 2010
Governm
ental grants Statutory
Voluntary
Retained
Capital
and donationsreserve
reserveearnings
Total
JDJD
JDJD
JDJD
Balance as at January 1, 200950,000,000
1,000,0001,355,077
2,710,154775,689
55,840,920
Pro�t-
-
-
-
7,051,338
7,051,338
Transferred to reserves-
-
773,084
1,546,168
(2,319,252)
-
Balance as at Decem
ber 31, 200950,000,000
1,000,0002,128,161
4,256,322
5,507,775
62,892,258
Increase of capital 1,000,000
(1,000,000)
-
-
-
-
Loss-
-
-
-
(4,228,158)
(4,228,158)
Balance as at Decem
ber 31, 201051,000,000
-
2,128,1614,256,322
1,279,617
58,664,100
44
SAMRA ELECTRIC POWER COMPANY
Private Shareholding Company
Amman - �e Hashemite Kingdom of Jordan
4
Statement of c ash �ow s for the year ended December 31, 2010
2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES JD JD
(Loss) pro�t before tax (3,487,842) 8,926,932
Depreciation 12,637,950 10,557,099
(Losses) gains on loans payable exchange di�erences 9,740,505 (5,980,608)Recovery of a provision (1,146,282) -
Change in operating assets and liabilities:
Restricted cash against of deposits - 5,090,710
Warehouses (3,492,408) (599,270)Other debit balances 27,659,495 (125,416)
National Electric Power Company receivable (13,791,583) 540,237
End of service indemnity provision 21,820 32,498
Other credit balances 14,765,042 5,124,533
Contractors retention 1,713,520 281,733
Accounts payable (8,826,106) 12,200,916
35,794,111 36,049,364
Income tax paid (1,221,241) (993,192)
Net cash from operating activities 34,572,870 35,056,172
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment (181,939,550) (69,569,677)
Employees housing fund loan (100,000) -
Net cash from investing activities (182,039,550) (69,569,677)CASH FLOWS FROM FINANCING ACTIVITIES
Due to banks 18,166 - Loans payable 147,955,375 33,546,851
Net cash from �nancing activities 147,973,541 33,546,851
Net change in cash and cash equivalents 506,861 (966,654)
Cash and cash equivalents - beginning of the year 74,000 1,040,654
Cash and cash equivalents - end of the year 580,861 74,000
45
SAMRA ELECTRIC POWER COMPANY
Private Shareholding Company
Amman - �e Hashemite Kingdom of Jordan
5
Notes to the �nancial statements
1. Legal status and activity
Samra Electric Power Generating Company was esta blished and registered in the register of the private shareholding companies under the number ( 40) on April 20, 2004 in implementation of the Council of Ministers resolution number 58/11/2/13075 dated August 27, 2003.
�e main o bjective s of the Company are :
Electric power generating in di�erent areas of the kingdom using any source of primary energy sources and new and renewable energy.
Establishing stations of electric energy generation that are required for its operation and to increase the generating e nergy according to general needs.
Contribution or participation in any project that related to generating electric energy inside and outside the kingdom.
�e Company is totally owned by the government of Hashe mite Kingdom of Jordan. �e �nancial statements have been approved by the board of directors in its meeting dated April 13, 2011
and require approval of the general assembly of shareholders. 2. Signi�cant accounting policies
Financial s tatements preparation framework
�e �nancial statements have been prepared in accordance with International Financial Reporting Standards.
Measurement bases used in preparing the �nancial statements
�e �nancial statements have been prepared on the historical cost basis except for measurement of certain items at b ases other than historical cost.
Property , plant and equipment
Property, plant and equipment are initially recognized at their cost being their purchase price plus any other costs directly attributable to bringing the assets to the location and condition necessary for them to be capable of operating in the manner intended by management.
A�er initial recognition, property, plant and equipment are carried, in the statement of �nancial position, at their cost less any accumulated depreciation and any accumulated impairment losses . Land s are not depreciated.
�e depreciation charge for each year is recognized as expense. Depreciation is calculated on a straight line basis, which re�ects the pattern in which the asset's future economic bene�ts are expected to be consumed over the estimated useful li ves of the assets using the following annual rates:
Category
% Gas and s team units
5
Gas converter station
5 Buildings
2 – 10
Fuel tanks
5 Other
5 - 25
�e estimated useful lives are reviewed at each year -end, with the e�ect of any changes in estimate accounted for on a prospective basis.
�e carrying values of property, plant and equipment are reviewed for impairment when events or changes in the circumstances indicate the carrying value may not be recoverable. If any such indication of impairment exists, impairments losses are calculated in accordance with impairment of assets policy.
On the subsequent de recognition of the property, plant and equipment, the resulting gain or loss, being the dif ference between the net disposals proceeded , if any, and the carrying amount, is included in pro�t or loss.
46
SAMRA ELECTRIC POWER COMPANY
6
Projects under construction
Amounts paid to construct property, plant and equipment item are charged �rst to projects under construction account w hen project becomes ready to use, it is transferred to the related property, plant and equipment caption.
Impairment of assets
At each statement of �nancial position date, management reviews the carrying amounts of its assets to determine whether t here is any indication that those assets have been impaired.
If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss, if any, being the amount by which the carrying amount of the asset exceeds its recoverable amount. �e recoverable amount is the higher of asset's fair value less costs to sell and the value in use. �e asset's fair value is the amount for which that asset could be exchanged between knowledgeable, willing parties in arm's length transaction. �e value in use is the present value of the future cash �ows expected to be derived from the asset.
An impairment loss is recognized immediately as a loss. Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but the increased carrying amount due to reversal should not be more than what the depreciated historical cost would have been if the impairment had not been recognized in prior years. A reversal of an impairment loss is recognized immediately as income.
Financial instruments
A f inancial instrument is any contract that gives rise to a �nancial asset of one entity and �nancial liabilities or equity instrument of another entity.
Financial assets
A f inancial asset is any asset that is:
(a) Cash; (b) An equity instrument of another entity; (c) A contractual right to receive cash or another �nancial asset from another entity, or to exchange
�nancial assets or �nancial liabilities with another entity under conditions that are potentially favorable to the entity.
(d) A contract that will or may be settled in the entity’s own equity instruments.
Financial assets are initially measured at fair value plus, in the case of a �nancial asset not at fair value through pro�t or loss, transaction costs that are directly attributable to the acquisition of the �nancial asset .
All recognized �nancial assets are subsequently measured either at amortized cost or fair value, on the basis of both:
(a) �e entity’s business model for managing the �nancial assets, and (b) �e contractual cash �ow characteristics of the �nancial assets.
A �nancial asset is measured at amortized cost if both of the following conditions are met:
(a) �e asset is held within a business model whose objective is to hold assets in order to collect contractual cash �ows.
(b) �e contractual terms of the �nancial asset give rise on speci�ed dates to cash �ows that are solely payments of principal and interest on the principal amount outstanding.
All other �nancial assets are subsequently measured at fair value. A gain or loss on a �nancial asset that is measured of fair value and is not part of a hedging
relationship is recognized in pro�t or loss unless the �nancial asset is an investment in an equity instrument and the entity has elected to present gains and losses on that investment in other comprehensive income.
47
SAMRA ELECTRIC POWER COMPANY
7
Cash and cash equivalents
Cash comprises cash on hand, current accounts and demand deposits with banks. Cash equivale nts are short - term, highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insigni�cant risk of changes in value.
Loans and trade receivables
Loans and t rade receivables are non-derivative �nancial assets with �xed or determinable payments that are not quoted in an active market.
Trade receivables are stated at invoices amount net of any allowance for doubtful receivables which represents the collective impairment of receivables.
Impairment of � nancial assets
Financial a ssets, other than those at fair value through pro�t or loss , are assessed for indicators of impairment at the end of each year .
For �nancial assets carried at amortized cost, the amount of impairment loss is the di�erence bet ween the asset’s carrying amount and the present value of estimated future cash �ows, discounted at the �nancial asset’s original e�ective interest rate. �e carrying amount of the �nancial asset is reduced by the impairment loss directly for all �nancial assets. �e amount of the impairment loss shall be recognized in pro�t or loss.
Financial liabilities
A f inancial liability is any liability that is:
(a) A contractual obligation to deliver cash or another �nancial asset to another entity, or to exchange �nancial assets or �nancial liabilities with another entity under conditions that are potentially unfavorable to the entity; or
(b) A contract that will or may be settled in the entity’s own equity instruments.
Financial liabilities are initially recognized at fair value plus transaction costs, directly attributable to the acquisition or issue of those liabilities, except for the �nancial liabilities classi�ed as at fair value through pro�t or loss, which are initially measured at fair value.
A�er initial recognition, the entity measures all �nancial liabilities at amortized cost using the e�ective interest method, except for �nancial liabilities at fair value through pro�t or loss which are measured at fair value and other determined �nancial liabilities which are not measured under amortized cost method.
Financial liabilities at fair value through pro�t or loss are stated at fair value, with any resulting gain or loss from change in fair value is recognized through pro�t or loss.
Trade paya bles and accruals
Trade payables and accruals are liabilities to pay for goods or services that have been received or supplied and have been either invoiced or formally agreed with the suppliers or not.
Inventories
Inventories are measured at the lower of cost and net realizable value. Inventory costs comprise all costs of purchase, costs of conversion and other costs incurred in bringing
the inventories to their present location and condition. �e cost of inventory is assigned by using the weighted -aver age cost formula. Net realizable value is the estimated selling /usage price in the ordinary course of business less the
estimated costs of completion and the estimated costs necessary to make the sale/usage .
48
SAMRA ELECTRIC POWER COMPANY
8
Provisions
Provisions are present obligations (legal or constructive) resulted from past events, the settlement of the obligations is probable and the amount of those obligati ons can be estimated reliably. �e amount recognized as a provision is the best estimate of the expenditure required to settle the present obligation at the statement of �nancial position date.
Provisions reviewed and adjusted at each statement of �nancial position date. If out�ows, to settle the provisions, are no longer probable, reverse of the provision is recorded as income.
End of service indemnity
End of service indemnity is calculated based on the di�erence between indemnity amount computed according to Jordanian Labor Laws and Regulations and periodic contributions which the Company paid to the Social Security Corporation.
Income t ax
Income tax is calculated in accordance with Jordanian laws and regulations
Contingent liabilities
Contingent liabilities are possible obligations depending on whether some uncertain future events occur, or they are present obligati ons but payments are not probable or the amounts cannot be measured reliably.
Contingent liabilities are not recognized in the �nancial statements.
Statutory reserve
Statutory reserve is allocated according to the Jordanian Companies Law by deducting 10 % of the annual net pro�t until the reserve equals one quarter of the Company’s subscribed capital. Such reserve is not available for dividends distribution.
Voluntary reserve
�is reserve is determined in accordance with the Jordanian Companies Law by allocating 20% annually of the pro�t to this reserve.
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable.
Power revenue
Energy revenues are recognized when the unit enters the production phase as fol lows:
Fixed revenue which results from the capacity tari� is calculated based on the ability of units entered into production.
Variable revenue which results from the production tari� is calculated based on the produced quantity of energy for units ente red in to production multiplied by the variable revenue rate.
Interest revenue
Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the e�ective interest rate applicable.
49
SAMRA ELECTRIC POWER COMPANY
9
Borrowing costs
Borrowing costs are interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing costs are expensed in the period in which they are incurred.
Borrowing costs in relation to the acquisition, construction and production of the qualifying as sets are treated as part of the cost of the relevant assets.
Qualifying assets are those assets that take a substantial period of time to get ready for their intended use.
�e borrowing costs eligible for capitalization are the actual borrowing costs incurred on the borrowing less any investment income on the temporary investment of those borrowings.
�e borrowing costs eligible for capitalization are determined by applying capitalization rate to the expenditures on the qualifying assets. �e capitalization rate is the weighted average of the borrowing applicable to the borrowings of the entity that are outstanding during the year, other than borrowings made speci�cally for the purpose of obtaining the qualifying assets.
Capitalization of borrowing costs commence when: Expenditures for the qualifying assets are being incurred Borrowing costs are being incurred, and Activities that are necessary to prepare the qualifying assets for their intended use or sale are in
progress.
Foreign currencies
�e �nanc ial statements are presented in the Jordanian Dinar (functional currency). In preparing the �nancial statements, transactions in currencies other than the functional currency
(foreign currencies) are recorded at the rates of exchange prevailing at the dates of the transactions. At each statement of �nancial position date, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the statement date (closing rate). Non -monetary items that are measured in terms of historica l cost in a foreign currency are translated using the exchange rate at the date of the transaction . Non-monetary items that are measured at fair value in foreign currency are translated using the exchange rates at the date when the fair value was determine d.
Exchange di�erences arising on the settlement of monetary items or on translating monetary items at rates di�erent from those at which they were translated on initial recognition during the year or in previous �nancial statements shall be recognized in pro�t or loss in the year in which they arise.
Accounting judgments
�e estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised. Accounting adjustments has no retrospective e�ects.
50
SAMRA ELECTRIC POWER COMPANY
10
3.
Prop
erty
, pla
nt a
nd eq
uipm
ent
As at
As a
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at
As a
tJa
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y 1,
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tions
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ects
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55,8
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-
97
,568
,900
97,5
68,9
00-
2,
044,
937
2,04
4,93
795
,523
,963
-
Stea
m u
nit -
Firs
t59
,934
,779
-
-
59,9
34,7
799,
952,
390
2,99
6,73
912
,949
,129
46,9
85,6
5049
,982
,389
Gas u
nit -
�ird
40,9
02,4
03-
-
40
,902
,403
4,09
5,84
32,
045,
120
6,14
0,96
334
,761
,440
36,8
06,5
60
Gas u
nit -
Fou
rth
37,9
60,6
65-
-
37
,960
,665
2,69
3,64
71,
898,
033
4,59
1,68
033
,368
,985
35,2
67,0
18
Gas u
nit -
Firs
t 30
,250
,476
-
-
30,2
50,4
766,
054,
037
1,51
2,52
47,
566,
561
22,6
83,9
1524
,196
,439
Gas u
nit -
Seco
nd
30,2
50,4
76-
-
30
,250
,476
6,05
4,03
71,
512,
524
7,56
6,56
122
,683
,915
24,1
96,4
39
Build
ings
2,15
2,11
7-
1,
675,
894
3,82
8,01
138
4,08
411
6,42
550
0,50
93,
327,
502
1,76
8,03
3
Land
s-
-
2,
453,
866
2,45
3,86
6-
-
-
2,
453,
866
-
Paym
ents
on la
nds a
cqui
sitio
n 51
0,91
336
4,67
8(3
98,8
66)
476,
725
-
-
-
476,
725
510,
913
Gas c
onve
rter s
tatio
n 2,
804,
500
-
-
2,80
4,50
053
7,91
314
0,22
567
8,13
82,
126,
362
2,26
6,58
7
Fuel
tank
s1,
854,
484
-
-
1,85
4,48
437
1,15
192
,724
463,
875
1,39
0,60
91,
483,
333
Oth
er1,
820,
752
198,
222
8,80
72,
027,
781
738,
387
278,
699
1,01
7,08
61,
010,
695
1,08
2,36
5
Tota
l26
4,34
0,14
018
1,93
9,55
0-
44
6,27
9,69
030
,881
,489
12,6
37,9
5043
,519
,439
402,
760,
251
233,
458,
651
Cost
Accu
mul
ated
Dep
recia
tion
Net B
ook V
alue
(*
) Cos
ts o
f pr
oper
ty, p
lant
and
equ
ipm
ent i
nclu
de
an a
mou
nt o
f JD
2,6
89,2
71 w
hich
rep
rese
nts
allo
cate
d b
orro
win
g co
sts a
s at D
ecem
ber 3
1, 2
010.
51
SAMRA ELECTRIC POWER COMPANY
11
4. Warehouses
2010 2009
JD JD
Station warehouse 9,600,288 7,832,702
Fuel Warehouse 8,114,270 6,389,448
Total 17,714,558 14,222,150
5. Other debit balances
2010 2009
JD JD
Advances to contractors 1,073,622 28,931,604
Prepaid expenses 441,229 162,977
Letter of credits and orders 269,346 339,462
Orders di�erences receivables 42,912 64,334
Employees receivable 15,022 3,628
Refundable deposits 550 550
Total 1,842,681 29,502,555
6. Nationa l E lectric Power C ompany receivable
2010 2009
JD JD
Trade receivable 18,565,351 5,582,420
Less: allowance for doubtful receivable - (985,015)
Net 18,565,351 4,597,405
National Electric Power Company is the sole client of the Company .
�e m ovement of allowance during the year was as follows :
2010 2009
JD JD
Beginning of the year balance 985,015 - Write-o� (808,652) - Recovery of allowance (176,363) - Additions - 985,015
End year balance - 985,015
52
SAMRA ELECTRIC POWER COMPANY
12
7. Cash and cash equivalents
2010 2009
JD JD
Current accounts at banks 578,461 71,435 Petty cash 2,400 2,565
Total 580,861 74,000
8. Capital / government al grants and donations
�e council of ministers agreed on August 29, 2010 to capitaliz e the government al grants and donations amounting JD (1) million and a dd it to the capital to become JD (51) millions. Legal procedures for increasing the capital were completed at the Companies Control Department on November 30, 2010 .
9. End of service indemnity provision
2010 2009
JD JD
Beginning of the year balance 141,671 109,173
Provided during the year 28,500 32,498
Paid during the year (6,680) -
Ending of the year Balance 163,491 141,671
53
SAMRA ELECTRIC POWER COMPANY
13
10.
Loans payable
2009
Lenders Granted date
Currency Original amount
of the loan loan's duration
Interest rateCurrentportion
Longterm portion
BalanceBalance
%JD
JDJD
JDKuwait Fund For Arab Economic Development - 696
March 9, 2005KWD
12,250,000
Repayable in 34 semi-annual installments a�er a grace period of four years starting from the date of the �rst payment for �rst withdrawal
41,710,911
25,831,50027,542,411
28,479,100
Arab Fund for Economic & Social Development - 462 May 8, 2005
KWD21,000,000
Repayable in 35 semi -annual installments a�er a grace period of �ve years starting from the date of the �rst payment for �rst withdrawal
4,53,060,000
47,430,00050,490,000
51,870,000
Arab Fund for Economic & Social Development - 515 May 6, 2007
KWD20,000,000
Repayable in 35 semi -annual installments (34 equal installments of KWD 570,000 and last installment of KWD 620,000) a�er a grace period of �ve years starting from the date of the �rst repayment for �rst withdrawal
4,5-
51,000,000
51,000,00049,400,000
Arab Fund for Economic & Social Development - 524March 10, 2008
KWD30,000,000
Repayable in 35 semi -annual installments (34 equal installments of KWD 860,000 and the last installment of KWD 760,000) a�er a grace period of �ve years starting from the date of the �rst payment for �rst withdrawal
4,5-
76,500,000
76,500,00027,513,708
Arab Fund for Economic & Social Development - 542December 16, 2009
KWD30,000,000
Repayable in 35 semi-annual installments (34 equal installments of KWD 860,000 and the last installment of KWD 760,000) a�er a grace period of �ve years starting from the date of the �rst payment for �rst withdrawal
3-
60,536,930
60,536,930-
Kuwait Fund For Arab Economic Development - 802March 18, 2010
KWD15,000,000
Repayable in 40 semi-annual installments of KWD 375,000 a�er a grace period of four years starting from the date of �rst withdrawal
3-
38,232,406
38,232,406-
Saudi Fund For Development April 14, 2010
SAR193,000,000
Repayable in 30 semi-annual installments of SAR 6,433,000 starting from October 1, 2015
2-
30,925,296
30,925,296-
Cairo Amman Bank and Arab Investment Bank - syndicated loanJune 22, 2006
JOD25,000,000
Repayable in 16 annual installments starting a�er 2 years of the agreement date until the loan paid in full
3,53,125,000
12,500,00015,625,000
18,750,000
Cairo Amman Bank - revolving loanNovember 19, 2009
JODceiling 12,000,000
Repayable during 12 months from �nancing date or receiving the payment from Arab Fund whichever is earlier
5,5-
-
-
7,208,443
Union Bank - revolving loan November 30, 2009
JODceiling 12,000,000
Repayable during 12 months from �nancing date or receiving the payment from Arab Fund whichever is earlier
5,68-
-
-
9,934,912
7,895,911342,956,132
350,852,043193,156,163
2010
(*)All foreign loans are
guaranteed by the governm
ent of H
ashemite K
ingdome of Jordan
, w
hile local loans are secured
by the Com
pany’s assets.
54
SAMRA ELECTRIC POWER COMPANY
14
11. Income tax provision
2010 2009
JD JD
Beginning of the year balance 2,145,853 1,263,451
Recovery of a provision (969,919) - Paid during the year (1,221,241) (993,192)Provided during the year 740,316 604,088
Income tax for prior years - 1,271,506
End of the year balance 695,009 2,145,853
(*) The Company has reached to �nal settlement with the I ncome and Sales Tax D epartment until the end of year 2009.
12. Other credit balances
2010 2009
JD JD
Accrued interest 3,648,234 1,866,418
Orders di�erences payable 65,396 13,215 Board of directors rewards provision 12,000 12,000
Other 7,431 16,545
Employees payable 2,637 1,877 Employment, Technical and Vocational Education and Training Fund provision - 63,422
Total 3,735,698 1,973,477
13. Account s payable
2010 2009
JD JD
Contractors payable 3,007,076 11,892,288
Vendors payable 740,895 730,869
Total 3,747,971 12,623,157
14. Due to banks
Bank Guarantees Ceiling Interest 2010
JD % JD
Arab Jordan Investment Bank Company 4,250,000 5,5 18,166
Amman Cairo Bank ( *) Company 10,000,000 5 -
Total 18,166
(*)�is item represents unused facility account.
55
SAMRA ELECTRIC POWER COMPANY
15
15. Station opera tion and maintenance cost
2010 2009
JD JD
Maintenance 1,009,504 2,586,676 Water and electricity 78,288 187,806 Chemical materials 54,976 70,547 Laboratories 47,888 4,162 General safety 10,984 10,660
Total 1,201,640 2,859,851
16. Administrative and operating expenses
2010 2009
JD JD
Insurance 658,509 472,601
Governmental fees and subscriptions 281,135 272,893
Computer and internet 96,921 44,772
Security 82,619 73,321
Professional fees 70,906 13,890
Electricity and water 49,025 33,911
Cleaning 46,184 35,160
Rent 46,083 82,000
General maintenance and supplies 43,327 31,765
Communication 37,684 33,853
End of service indemnity 28,500 32,498
Salaries and transportation of board of directors members 26,575 30,000
Fuel and heating 21,690 15,439
Hospitality 20,537 14,165
Stationery and printing 16,376 19,494
Training 16,086 18,878
Board of directors rewards 12,000 12,000
Miscellaneous 8,098 8,527
Advertising and promotion 7,622 6,838
Per diems, accommodations and travel 6,669 4,340
Vehicles 6,259 4,044
Orders 5,609 2,649
Medical tests 5,021 3,462
Social activity and sports 4,534 12,896
Conferences and delegations 4,346 2,060
Employment, Technical and Vocational EducationTraining Fund fees - 63,417
Total 1,602,315 1,344,873
56
SAMRA ELECTRIC POWER COMPANY
16
17. Sal aries, wages and other bene�ts
2010 2009
JD JD
Employees salaries and bene�ts 2,213,595 2,054,447
Social security contribution 193,609 179,878
Saving fund contribution 186,778 164,059
Medical insurance contribution 112,138 104,776
Total 2,706,120 2,503,160
18. Other income
2010 2009
JD JD
Recovery of allowances 1,146,282 - Scrap disposals 177,954 - Tenders copies 12,870 92,525
Interest 3,703 569,324
Other 311 822
Total 1,341,120 662,671
19. Financing cost
2010 2009
JD JD
Total �nancing costs 11,299,276 7,104,147
Less: interest allocated to property, plant and equipment - Note (3) (2,689,271) -
Net 8,610,005 7,104,147
20. Legal cases
According to the lawyer’s letter , there are legal cases raised by others against the Company amounted to JD 494,224 related to claims of land s acquisition, and there are legal cases with undetermined amounts. �ese cases are still pending in related courts.
57
SAMRA ELECTRIC POWER COMPANY
17
21. Risk management
a) Capital risk:
Regularly, the capital structure is reviewed and the cost of capital and the risks associated with capital are considered. In addition, capital is managed properly to ensure continuing as a going concern while maximizing the return through the optimization of the debt and equity balance .
�e Company 's capital structure consists of equity and loans payabl e. Loans payable to capital structure ratio reached 85.7%, and debt to equity ratio reached 653%.
b) Currency risk:
Currency risk is the risk that the fair value or future cash �ows of a �nancial instrument will �uctuate because of changes in foreign exchange rates.
�e risk arises on certain transactions denominated in foreign currencies, which imposes sort of risk due to �uctuations in exchange rates during the year .
�e entity is exposed to currency risk resulting from loans payable and the e�ect was re�ected in pro�t or loss.
c) Interest rate risk:
Interest rate risk is the risk that the fair value or future cash �ows of a �nancial instrument will �uctuate because of changes in market interest rates.
�e risk arises on exposure to a �uctuatio n in market interest rates resulting from borrowings .
d) Other p rice risk:
Other price risk is the risk that the fair value or future cash �ows of a �nancial instrument will fluctuate because of changes in market prices (other than those arising from inte rest rate risk or currency risk), whether those changes are caused by factors speci�c to the individual �nancial instrument or its issuer, or factors a�ecting all similar �nancial instruments traded in the market.
�e risk arises from investing in equ ity investments. �e entity is not exposed to other price risk.
e) Credit risk:
Credit risk is the risk that one party to a �nancial instrument will cause a �nancial loss for the other party by failing to discharge an obligation.
�e entity maintains cash at �nancial institutions with suitable credit rating. Trade receivables of the entity concentrate in National Electric Power Company receivable . �e carrying amount of �nancial assets recorded in the �nancial statements represents the maximum
exposure to credit risk without taking into account the value of any collateral obtained.
58
SAMRA ELECTRIC POWER COMPANY
18
f) Liquidity risk:
Liquidity risk is the risk of encountering di�culty in meeting obligations associated with �nancial liabilities that are settled by delivering cash or another �nancial assets.
Liquidity risk is managed through monitoring cash �ows and matching with maturity dates of the �nancial assets and liabilities.
�e following table shows the maturity dates of �nancial assets and liabilities as of December 31:
Description2010 2009 2010 2009
Financial assets JD JD JD JDEmployees housing fund loan - - 350,000 250,000 Other debit balances 58,484 68,512 - - National Electric Power Company receivable 18,565,351 4,597,405 - - Cash and cash equivalents 580,861 74,000 - -
TOTAL 19,204,696 4,739,917 350,000 250,000
Financial liabilitiesLoans payable 7,895,911 24,961,355 342,956,132 168,194,808Other credit balances 3,735,698 1,910,055 - - Contractors retentions 23,937,224 9,172,182 - - Accounts payable 3,747,971 12,623,157 - - Due to banks 18,166 - - -
TOTAL 39,334,970 48,666,749 342,956,132 168,194,808
Less than one year One year and above
22. Fair value of �nancial instruments
�e fair values of �nancial assets and liabilities are determined as follows:
the fair value of �nancial assets and liabilities with standard terms and conditions and which are traded on active markets are determined with reference to quoted market prices;
the fair value of other financial assets and liabilities (excluding derivative instruments) are determined in accordance with generally accepted pricing models based on discounted cash �ow analysis; and
�e fair value of derivative instruments, are calculated using quoted prices.
Where such prices are not available discounted cas h �ow analysis is used.
59
SAMRA ELECTRIC POWER COMPANY
19
23. Adoption of new and revised standards
In the current year, the new and revised International Financial Reporting Standards (IFRSs) including the International Accounting Standards (IASs) and their interpretations that are rele vant to operations and e�ective for annual reporting periods have been adopted. �e adoption of these new and revised Standards and Interpretations has resulted in changes to the accounting policies in the following areas: IFRS 3 ’Business combinations’. �e amendments clarify that the new requirements for contingent
consideration set out in IFRS 3 (2008) should not be applied to business combinations whose acquisition date preceded the application of IFRS 3 (2008). Applicable for periods beginning on July 1, 2010, and a�er.
IFRS 5 ‘Non-current assets held for sale and discontinued operations ’. �e amendment s clarify the
disclosures required in respect of non -current assets (or disposal groups) classi�ed as held for sale or discontinued operations; or disclosures about measurement of assets and liabilities within a disposal group that are not within the scope of the measurement requirement of IFRS 5 and such disclosures are not already provided in the notes to the �nancial statements. It also clari�es that the general requirement of IAS 1 still apply, particularly IAS 1 paragraph 15 (to achieve a fair presentation) and paragraph 125 (sources of estimation uncertainty). Applicable for periods beginning on January 1, 2010, and a�er.
IFRS 9 "Financial Instruments". �e new amendments introduce a new classi�cation and measurement
requirements of �nancial assets and liabilities and derecognition.
IFRS 9 requires all recognized �nancial assets that are within the scope of IAS 39 to be subsequently mea sured at amortized cost or fair value.
Debt investments that are held within a business model whose objective is to collect the contractual cash �ows, and that have contractual cash �ows that are solely payments of principal and interest on the princip al outstanding are generally measured at amortized cost at the end of subsequent accounting periods. All other debt investments and equity investments are measured at their fair values at the end of subsequent accounting periods.
�e amendments clarify the accounting for changes in fair value of a �nancial liability (designated as at fair value through pro�t or loss) attributable to changes in the credit risk of that liability. Speci�cally, for �nancial liabilities that are designated as at fair value through pro�t or loss, the amount of change in the fair value of the �nancial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the e�ects of changes in the liability's credit risk in other comprehensive income would create or enlarge an accounting mismatch in pro�t or loss. Changes in fair value attributable to a �nancial liability's credit risk are not subsequently reclassi�ed to pro�t or loss. Appli cable for periods beginning on January 1, 2013, and a�er, with earlier application permitted.
This standard was applied for the current period’s �nancial statements .
IAS 1 ’Presentation of �nancial statements’. �e amendments clarify that the potential settlement of a liability by the issue of equity is not relevant to its classi�cation as current or not – current. Applicable for periods beginning on January 1, 2010, and a�er.
IAS 7 ‘Statement of cash �ows’. �e amendments clarify that only expend itures that result in a recognized asset in the statement of �nancial position can be classi�ed as investing activities in the statement of cash �ows. Applicable for periods beginning on January 1, 2010, and a�er.
60
SAMRA ELECTRIC POWER COMPANY
20
IAS 28 ‘Investments in associates’. �e amendments clarify that transaction when investor losses signi�cant in�uence over an associate should be applied prospectively. Applicable for periods beginning on July 1, 2010, and a�er.
IAS 32 ‘ Financial instruments - presentation ’. �e amendme nts allow rights issues to be classi�ed as equity
when the price is denominated in a currency other than the entity’s functional currency. Applicable for periods beginning on February 1, 2010, and a�er, and should be applied
retrospectively.
IFRIC 19 ‘Extinguishing �nancial liabilities with equity instruments’. Under this interpretation , equity instruments issued under such arrangements will be measured at their fair value, and any di�erence between the carrying amount of the �nancial liability extinguished and the fair value of equity instruments issued will be recognized in pro�t or loss. Applicable for periods beginning on July 1, 2010, and a�er.
At the date of authorization of these �nancial statements, the following Standards and Interpretations issued but not yet e�ective : IFRS 7 ‘�nancial instruments: disclosures’. �e amendments are intended to provide greater transparency
around risk exposures of transactions when a �nancial asset is transferred but the transferor retains some level o f continuing exposure in the asset. �e amendments also require disclosures where transfers of �nancial assets are not evenly distributed throughout the period. Applicable for periods beginning on July 1, 2011, and a�er.
IAS 24 ‘Related party disclosures’. �e amendments relax the disclosures of transactions between the
government al entities and clarify related -party de�nition. Applicable for periods beginning on January 1, 2011, and a�er.
Management anticipates that the adoption of these Standards and Interpretations in current or future periods will have no material �nancial impact on the �nancial statements.
24. Reclassi�cation
2009 balances have been reclassi�ed to conform to the adopted classi�cation in 2010.