OREANDA-NEWS. On 31 July 2009 was announced, that United Company RUSAL remitted 300 million roubles to the projects for construction of the Boguchanskaya HPP.  This payment was made for the purpose of current financing of the power station's construction during the third quarter of 2009.  After the payment was made, UC RUSAL overall debt within the scope of evening out the partners' shares in financing the power station's construction was reduced to 728.52 million roubles.

JSC RusHydro considers that, in July, the partner will cover its debt in full and even out it share in the project, after which investment will continue on an equal basis in accordance with the Agreement signed in 2006. 

The next objective of the negotiations between JSC RusHydro with its partner in the construction of the Boguchanskaya HPP, UC RUSAL, is the signing of an investment agreement that the parties announced the need for after a working meeting held at the power station building site on 27 June, 2009 under the chairmanship of Deputy Minister for Power of the Russian Federation, Vyacheslav Sinyugin.

The draft investment agreement, which is currently in the process of being agreed, envisages strictly fixed financial obligations of JSC RusHydro and UC RUSAL to provide investment in completing construction of the Boguchanskaya HPP to a sum of over 500 million US dollars each.

The agreement, which the parties are to sign during the 3rd quarter of this year, proposes a monthly time schedule for payments up to the end of the project and does not prohibit raising outside finances.   Knowing the payment time schedule, each partner may, if necessary, apply in advance for bank loans and raise project finance.  In addition, at the demand of banks if they are prepared to allocate funds for the Boguchanskaya HPP project, a change of the time schedule, volumes and mechanisms of the financing of the work is possible.  The draft Co-investment Agreement also sets out precisely the penalties on a partner that violates the payment time schedule.  If, however, the partners intend to finance construction in due time and in the due amount, fines should not be of concern to the parties: they will not apply if the payment obligations are properly discharged.

The existing partnership agreement has proved, under the conditions of the financial crisis, to be inadequate where it comes to payment for the work on the Boguchanskaya HPP, since it allows any partner, virtually unpunished, to stop the financing and wait for the other partner to invest more money.  Under the extremely tight construction time schedule, with only 18 months remaining until the planned start-up of the first stage of the HPP, such "soft" obligations engender a serious risk of the start-up being delayed.

Moreover, in accordance with agreement reached during the talks at the Boguchanskaya HPP construction site, JSC RusHydro is to continue, in conjunction with UC RUSAL, to implement measures to optimise the power station's construction costs.  Within the framework of the procedures for selecting alternative contractors for the Boguchanskaya HPP construction project, on 24 July, 2009, the envelopes containing proposals from potential alternative contractors were opened in the town of Kodinsk, Krasnoyarsk Territory.  The offers had been invited for the volume of construction and installation work under existing contracts concluded at the beginning of 2008 on the basis of public tenders.  According to the specified data provided by CJSC Boguchanskaya HPP Construction Organiser, which handled the selection procedure for alternative contractors, request to submit tender documentation were received from twenty-one construction and installation organisations but only one participant  applied to participate in the proposal procedure on all lots - JSC Holding Company Glavmosstroy (which belongs to the Bazovy Element holding company), which offered a price that was, on average 20% lower than that set in the current contracts.  The other participants withdrew from participation in the offer invitation procedure because, as they explained, they could not reduce the declared prices for the work.  In support of their position, the companies sent letters to the tender commission containing calculations testifying to the need to raise the prices of construction and installation work by 10 - 30% compared to the current contracts. 

The installed capacity of the Boguchanskaya HPP amounts to 3000 MW, the average annual output of electric power being 17.6 billion kWh.  The session of the Government of the Russian Federation on 9 April, 2009, chaired by Vladimir Putin, adopted a resolution to abide by the construction rates and deadlines for the purpose of ensuring start-up of the first phase of the Boguchanskaya HPP, with a capacity of 600 MW, in 2010  and attainment of full capacity of all the nine turbines is planned for 2012.