OREANDA-NEWS. August 27, 2010. The cooperation agreement between JSC RusHydro (ticker symbol: HYDR; MICEX, RTS and LSE), the Government of the Amur Region and JSC FGC UES determined the order and conditions for the cooperation and mutual obligations of the parties, aimed at developing the energy sector, including: realization of the investment program for constructing the Nizhne-Bureyskaya and Nizhne-Zeyskaya HPPs. The document was signed by the Governor of the Amur Region Oleg Kozhemyako, JSC RusHydro's Chairman of the Management Board Evgeny Dod and JSC FGC UES' Chairman of the Management Board Oleg Budargin.

In accordance with the agreement, the Government of the Amur Region undertook obligations to help ensure the guaranteed distribution of energy produced by the Nizhne-Bureyskaya HPP and the Nizhne-Zeyskaya HPP to projected and constructed objects on the territory of the Amur Region. Furthermore, the Government plans to work on issues connected with tariff formation and population transfer away from possible flood zones. With the aim of contributing to the investment process, the administration of the Region also plans to consider the opportunity of providing tax benefits to objects which are being projected and constructed within the framework of the agreement.

According to the signed agreement, JSC RusHydro is obligated to work out and coordinate power output schemes and project and authorization documentation, as well as to fulfill measures related to the technological connection of generating equipment to electric grids of the Amur Region and to carry out financing and construction of the Nizhne-Bureyskaya and Nizhne-Zeyskaya HPPs. In addition, RusHydro is to take part in developing and realizing the power saving program and upgrading energy effectiveness on the territory of the Amur Region, as well as programs and investment projects aimed at improving the Region's social and economic conditions.

On its part, JSC FGC UES is to construct electric grid objects for power output from the Nizhne-Bureyskaya and Nizhne-Zeyskaya HPPs, in accordance with the adopted scheme, to ensure consumers' technological connections in the Amur Region and to transfer electric energy (capacity) to them.

The second signed document was a tri-lateral agreement between JSC RusHydro, JSC FGC UES and JSC AK Transneft. The document determines the parties' interactions during realization of the investment projects connected with production, consumption and energy transfer at the created objects of the Nizhne-Bureyskaya HPP and the pipeline system "Eastern Siberia - Pacific Ocean" (ESPO-2). The document was signed by the Chairman of JSC RusHydro's Management Board Evgeny Dod, the Chairman of JSC FGC UES' Management Board Oleg Budargin and the President of JSC AK Transneft Nikolay Tokarev.

Based on the signed agreement, JSC RusHydro ensures that the Nizhne-Bureyskaya HPP will be put into operation, the development of the power output scheme for the power plant and the supply of energy to enterprises of JSC AK Transneft, including ESPO-2 objects. JSC FGC UES will construct electric grid objects for the power output of the Nizhne-Bureyskaya HPP in accordance with the adopted scheme and by the end of 2012 will commission objects for external power supply to the ESPO-2.  In turn, JSC AK Transneft will construct and commission power receiver facilities (ESPO-2).

An agreement was also signed between JSC RusHydro, JSC FGC UES and JSC Mechel. The agreement provides for the main principles and forms of interaction during the process of realization and after the conclusion of investment projects of production, consumption and energy transmission and the created objects of the Nizhne-Bureyskaya HPP and the Elginskoye coal deposit. The agreement was signed by JSC RusHydro's Chairman of the Management Board Evgeny Dod, JSC FGC UES' Chairman of the Management Board Oleg Budargin and Chairman of JSC Mechel's Board of Directors Igor Zyuzin.

In accordance with this agreement, JSC RusHydro is to construct and commission the Nizhne-Bureyskaya HPP under terms agreed upon with JSC Mechel and JSC RusHydro, as coordinated by JSC Mechel and JSC RusHydro in a separately concluded agreement on electric energy (capacity) supply, to develop and coordinate within the established procedure power output schemes, as well as to ensure guaranteed energy supply and capacity under agreements with the Supplier, performing power supply to enterprises of Mechel Group, including facilities belonging to the Elginskoye coal deposit.

JSC FGC UES is to ensure the timely financing of projecting and constructing external power supply objects for the Elginskoye coal deposit, power output schemes for the Nizhne-Bureyskaya HPP included in JSC FGC UES' zone of responsibility.

As per the agreement, JSC Mechel is to guarantee the timely construction and commissioning of power reception facilities at the Elginskoye coal deposit.

Within the project of Nizhne-Bureyskaya HPP construction, JSC RusHydro also signed a preliminary agreement for the sale and purchase of electric energy and capacity produced by the power plant with LLC Amursnab. In accordance with the concluded agreement, the parties are to conclude in the future an agreement on the sale and purchase of electric energy and capacity produced by the Nizhne-Bureyskaya HPP.

Furthermore, yesterday, a cooperation agreement was signed dealing with the sales and purchase of electric energy (capacity) on the territory of the Amur Region between JSC RusHydro and the Federal Space Agency (Roskosmos). The agreement was signed by JSC RusHydro's Chairman of the Management Board Evgeny Dod and the Head of Roskosmos Anatoliy Perminov.

In accordance with the agreement, the parties are to organize work for concluding (in the future) a bilateral agreement on the sale and purchase of electric energy (capacity) produced by the Nizhne-Bureyskaya HPP. At the same time, the Federal Space Agency, not later than November 1st, 2014, will determine the economic subject performing the exploitation of facilities for the  Vostochniy Space Center,  for concluding the main agreement.

It is planned to construct the Nizhne-Bureyskaya HPP on the Bureya River near the settlement of Novobureyskiy, 90 km downstream from the site of the Bureya HPP. The power plant is part of the Project of the Unified Bureya Energy Complex in the Amur Region and will become the counter-regulator of the Bureya HPP, which was commissioned at full capacity in 2009. Introduction of capacity from the  Nizhne-Bureyskaya HPP was taken into account in the "General scheme for deploying power industry objects till 2020," in the project  "General scheme for deploying power industry objects till 2020 with prospects till 2030," as well as in the project of the Program for developing the power industry of the Amur Region for the years 2010-2014.

The project capacity of the Nizhne-Bureyskaya HPP will total 320 MW, with an average multi-year output - 1,650 million kWh. Commissioning of the first phase (2 hydro units with capacity of 80 MW each) is scheduled for 2014, second phase - for 2015, the power plant will reach full project capacity in 2016. The project cost of construction is RUR 31,318 million.

The conclusion of construction of the Bureya energy complex and the launch of the Nizhne-bureyskaya HPP will resolve numerous important tasks, including upgrading the reliability of hydro-technical constructions, excluding winter flooding settlements in the down pool of the Bureya HPP and improving protection of the shores of the Bureya and Amur Rivers.

The pipeline system "Eastern Siberia - Pacific Ocean (ESPO) is a pipeline, which is being constructed that is designed to connect oil deposits of Western and Eastern Siberia to  ports in the Primorye Region of Russia and to ensure exits to American markets, as well as to the Asian-Pacific Region. The planned overall length of the pipeline is 4,188 kilometers. The operating company is the state company "Transneft." On December 28th, 2009, the first phase of the project (ESPO-1) was launched- a pipeline from Tayshet (the Irkutsk Region) to Skovorodino (the Amur Region) with a length of 2,694 kilometers.

The Nizhne-Zeyskaya HPP project, which is planned to be constructed on the Zeya River, 290.2 kilometers from the outfall, has the following project parameters: installed capacity - 400 MW, number of hydro power generation units - 4, average multi-year output - 2,325 million kWh. As of now, the term for commissioning the power plant has not been defined.