RusHydro and government of the Saratov region sign cooperation agreement
JSC RusHydro (ticker symbol: MICEX-RTS, LSE: HYDR; OTCQX: RSHYY) announces that it has signed a cooperation agreement, aimed at bolstering the development of hydropower and innovative power plant engineering. The document has been signed by RusHydro's Chairman of the Management Board Evgeny Dod and governor of the Saratov region signed Valery Radaev.
The agreement sets out the key parameters of cooperation between RusHydro and the Saratov region on the investment projects undertaken by the former in the region: EUR 1 bn overhaul of hydro-units of Saratovskaya hydropower plant and joint construction with Voith Hydro of a hydropower equipment manufacturing plant in Balakovo of the Saratovsk region.
The total investment in the joint venture (JV) of RusHydro and Voith will amount to EUR 50 mn. The sales of the plant are estimated at EUR 500 mn. The first significant order for the JV will be production of hydroelectric equipment for Saratovskaya hydropower plant. In future, the plant may produce equipment for other hydropower plants of RusHydro and other market participants.
The 13-year overhaul of Saratovskaya hydropower plant will encompass the replacement of 21 vertical Kaplan turbines with hydro turbines of a new generation and one hydro-unit. The new turbines will dramatically increase ecological safety of the power plant.
The government of the Saratov region will give a comprehensive support to the companies for these projects. Namely, the administration will provide a site for the plant and ease the process of acquiring all the necessary permits for the land use. The government also pledges to reduce lease payments for the project site, and work out other measures fostering the investments by the parties through decrease of profit tax and lower property tax throughout the projects' payback period.
RusHydro and Voith Hydro signed cooperation agreement in June 2011, at the St. Petersburg International Economic Forum. Voith pledged to provide investments, technical expertise and know-how for the joint venture.
Voith Hydro GmbH & Co.KG Company is a supplier of eco-friendly hydropower equipment and a world leader in designing and constructing hydropower plants. The Company offers integrated solutions for the turn-key installation of hydro-mechanical, turbine and generator equipment, auxiliary mechanical and electric systems, control systems, modernization and re-equipment services and providing the in-house manufacture of the main types of HPP equipment. Voith Hydro Company designs hydro-power turbines that completely eliminate machine oil ingress to water. At present, RusHydro and Voith Hydro are implementing joint projects at the Zaramagskaya HPP, the Uglichskaya HPP and other HPPs.
The information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of RusHydro. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might," the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially from these statements. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to RusHydro and its operations.
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