Russia restructures loan for Belarus nuclear power plant

The Russian government approved on June 22 a draft protocol restructuring the Belarusian-Russian intergovernmental agreement of 2011 on the granting of State export credits to Belarus for the construction of a nuclear power station in Ostravets.

The order was published on the official Russian Internet portal for legal information. According to the draft protocol, the proposal is to extend the period of use of the loan by two years – until the end of 2022. In addition, a fixed interest rate on the loan is set at 3.3% by year, and the start date of repayment of the main debt of the loan has been deferred from April 1, 2021 to April 1, 2023. If the debt is not repaid on time, after 180 days, the full amount, including any interest on the loan and its service, will be consolidated and must be repaid immediately, the document says.

The document was submitted by the Russian Ministry of Finance and agreed with the Russian Foreign Ministry, the Ministry of Economic Development, the state nuclear company Rosatom, the banking group VEB.RF, and had previously been agreed with Belarus . The Russian government instructed the Ministry of Finance, along with the Ministry of Foreign Affairs and other departments, to negotiate with Belarus and, once an agreement was reached, to sign a protocol on behalf of the government.

The 2011 Intergovernmental Agreement on the Construction of the Belarusian Nuclear Power Plant provides for cooperation for the design, construction and turnkey commissioning of two power plants with a capacity of 1200 MW each. For these purposes, Russia has granted a loan of up to $ 10 billion to Belarus. Funds were provided to finance 90% of the cost of the general contract for the construction of the plant, of which 10% was paid by Belarus. The repayment was to begin six months after the commissioning of the plant, but no later than April 1, 2021. The repayment was to be made in 30 equal parts every six months, 50% of the amount bearing interest at the rate of 5.23 % a year and the balance at the LIBOR rate for 6-month deposits in US dollars, increased by a margin of 1.83% per annum. Belarus requested that the loan be restructured due to construction delays.

The Belarusian nuclear power plant will consist of two VVER-1200 power units based on the NPP-2006 project using next-generation 3+ technology. The start-up of the first tranche was postponed from 2018 to 2019, then to the second quarter of 2020; the second is scheduled for 2021. The general contractor is Atomstroyexport (which is part of Rosatom). The customer is the Belarusian nuclear power plant RUE, which will also be the operator.


Photo: Belarus’ first nuclear power plant unit prepares for fuel loading (Photo: AtomStoryExport)

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