OREANDA-NEWS. On 10 June 2008 Changi Airports International (CAI) and Russian company Basic Element announced that they have signed a consortium agreement to bid for the right to develop and operate Pulkovo Airport in St Petersburg, Russia.

The consortium agreement was signed  in the presence of the Minister Mentor of Singapore Mr Lee Kuan Yew, Senior Minister Mr Goh Chok Tong, and  Chairman of the Civil Aviation Authority of Singapore Mr Liew Mun Leong.

“Pulkovo Airport has been on our radar screen for some time and it will be one of the landmark projects in the industry over the next few years.  We expect the field of competitors to be formidable but we are glad that we have a strong partner in Basic Element. They have one of the best management teams in Russia with significant experience in infrastructure development. In addition, they are thoroughly committed to this project,” – said Chow Kok Fong, Chief Executive Officer of Changi Airports International.

"I'm sure that the experience gained by Changi while running one of the best airports in the world and good Basic Element’s knowledge of airports management in Russia will enable us to make and present very competitive bid for the development and management of Pulkovo”, - says Gulzhan Moldazhanova, CEO of Basic Element.

The Pulkovo Airport development  is the first airport public private partnership (PPP) project in Russia.  The World Bank is advising the St Petersburg government on this project.  It will involve the upgrading and operation of the existing Pulkovo International Airport while a new terminal is developed.  In 2007,  the airport handled 6.1 million passengers.  Over the next 10 years, airport passenger traffic is forecasted to reach 17    million given the increasing importance of St Petersburg as an international tourism destination and its rapidly growing economy.

By the end of July all consortiums interested to participate in the Pulkovo project  are to submit their documents for  a prequalification process. The participants are expected to submit their final bids in February 2009 and the winner may be announced a few weeks later. The expected financial close will be in July 2009.

Basic Element is a diversified investment company with assets in Russia and abroad. Basic Element’s core assets are in 6 sectors – Energy, Resources, Manufacturing, Financial Services, Construction and Aviation.

Basic Element’s consolidated revenue exceeded \\$18 billion in 2006. Its combined asset value was more than \\$23 billion. Basic Element holds a 25% stake in the Austrian company Strabag, and a 9.99% stake in the German company Hochtief. The Company employs more than 300,000 people. Companies of the Basic Element are located in Russia and in countries of the CIS, Europe, Africa, Latin America, as well as in Australia.

Basic Element’s Aviation Sector manages the aviation assets, which include Basel Aero, an airport management company founded in 2007 and Kuban Airlines aviation company. At present, Basel Aero manages airports in southern Russia — in Sochi, Krasnodar, Gelendzhik and Anapa.