Construction of the Kaps Reservoir will be the largest project in this sector – Minister
12.06.2026,
13:00
The Kaps Reservoir will be the largest project in the reservoir construction sector; a new project and tender are being prepared, stated Armenian Minister of Territorial Administration and Infrastructure David Khudatyan.
YEREVAN, June 12. /ARKA/. The Kaps Reservoir will be the largest project in the reservoir construction sector; a new project and tender are being prepared, stated Armenian Minister of Territorial Administration and Infrastructure David Khudatyan.
"Last year, we terminated the contract with the Chinese company regarding the Kaps Reservoir, as significant deviations from the work schedule were noted. At the same time, the project is being updated. We are currently close to completing the design for the construction of a 60 million cubic meter reservoir, which is approximately two and a half times larger than the originally planned volume," Khudatyan noted during preliminary discussions of the annual report on the execution of the 2025 state budget of the Republic of Armenia. In December 2025, the Ministry of Territorial Administration and Infrastructure of the Republic of Armenia and the Territorial Development Fund announced that construction of the Kaps Reservoir had been suspended and the contract with the Chinese company Shanxi Construction Investment Group had been terminated due to persistent failure to meet the schedule and terms of the contract.
The minister stated that once the project was completed and passed all necessary assessments, a new tender would be announced in the hopes of attracting a new construction company that could commission the Kaps Reservoir on schedule and within the established deadline.
The agreement for the construction of the Kaps Reservoir in the Shirak region was signed between the Armenian government and the German bank KfW in April 2023.
The project budget was €97.8 million, of which €68.5 million was a loan from KfW, with the remainder to be co-financed by the Armenian government. Reports indicate a total budget of approximately €95–120 million. The project is planned for implementation in two phases: Phase 1 – a reservoir with a capacity of 25 million cubic meters; Phase 2 – expansion to 60 million cubic meters. With a capacity of 25 million cubic meters, it is planned to provide water to approximately 17,000 hectares of land through the Akhuryan and Shirak canals, convert 2,280 hectares from mechanical irrigation to gravity irrigation, and save approximately 1.3 million kWh of electricity per year. With the expansion to 60 million cubic meters, land in the Talinsky District (several thousand more hectares) will be converted to gravity irrigation, and energy savings will increase to 11 million kWh per year.
"Last year, we terminated the contract with the Chinese company regarding the Kaps Reservoir, as significant deviations from the work schedule were noted. At the same time, the project is being updated. We are currently close to completing the design for the construction of a 60 million cubic meter reservoir, which is approximately two and a half times larger than the originally planned volume," Khudatyan noted during preliminary discussions of the annual report on the execution of the 2025 state budget of the Republic of Armenia. In December 2025, the Ministry of Territorial Administration and Infrastructure of the Republic of Armenia and the Territorial Development Fund announced that construction of the Kaps Reservoir had been suspended and the contract with the Chinese company Shanxi Construction Investment Group had been terminated due to persistent failure to meet the schedule and terms of the contract.
The minister stated that once the project was completed and passed all necessary assessments, a new tender would be announced in the hopes of attracting a new construction company that could commission the Kaps Reservoir on schedule and within the established deadline.
The agreement for the construction of the Kaps Reservoir in the Shirak region was signed between the Armenian government and the German bank KfW in April 2023.
The project budget was €97.8 million, of which €68.5 million was a loan from KfW, with the remainder to be co-financed by the Armenian government. Reports indicate a total budget of approximately €95–120 million. The project is planned for implementation in two phases: Phase 1 – a reservoir with a capacity of 25 million cubic meters; Phase 2 – expansion to 60 million cubic meters. With a capacity of 25 million cubic meters, it is planned to provide water to approximately 17,000 hectares of land through the Akhuryan and Shirak canals, convert 2,280 hectares from mechanical irrigation to gravity irrigation, and save approximately 1.3 million kWh of electricity per year. With the expansion to 60 million cubic meters, land in the Talinsky District (several thousand more hectares) will be converted to gravity irrigation, and energy savings will increase to 11 million kWh per year.
