AlfaStrakhovanie recognized the incident at Zagorskaya PSPP-2 as the insurable event
JSC RusHydro (ticker symbol: MOEX, LSE: HYDR; OTCQX: RSHYY) announces that JSC AlfaStrakhovanie (Alfa-Group) recognized the incident at the construction site of the Zagorskaya pump storage plant No. 2 (PSPP-2) on September 17, 2013, as an insurable event. The insurance compensation could amount to RUB 1.2 bn. AlfaStrakhovanie will determine the final amount of compensation based on the results of project documentation analysis and calculation of estimated rehabilitation costs.
Earlier, JSC SOGAZ also recognized the incident at the Zagorskaya PSPP-2 as the insurable event. An approval from a third insurer – Ingosstrakh – is still pending.
At the same time, RusHydro continues the restoration of the Zagorskaya PSPP-2. In 2014, the stabilization of the plant was successfully completed; the inventory and inspection of the plant’s equipment were made by the engineers of JSC Institute Hydroproject, the general design engineer of the plant. Institute Hydroproject has developed several schemes for restoration of the Zagorskaya PSPP-2. All these schemes were reviewed by RusHydro, the energy experts and an independent advisor, Lahmeyer International, one of the leading international engineering companies. According to the expert’s report compensation grounding is the most preferable method for restoration of the plant. This method provides for adjusting the powerhouse by bulking the soil under it. The cementation of the space under the building of PSPP will allow to build the foundation to align the construction.
The incident at the Zagorskaya PSPP-2 took place on September 17, 2013. At 22:57 the shift on duty noticed that the turbine room is getting filled with water. At this moment 15 employees have been working on the site. All of them left the building in an organized manner and nobody got injured. In the few following hours the turbine room and the adjacent area have been partially flooded. The primary survey of the site showed that the powerhouse has subsided and water came in through the deformation joints and intakes of half-finished water pipes. Further exploration, including with the help of drilling, identified caverns, formed by washout of soil. These caverns were immediate cause of the subsiding. Two inquiry commissions – one formed by Rostekhnadzor (the Federal Service for Ecological, Technological and Nuclear Supervision) and another by RusHydro – have studied the incident. Market Council allowed RusHydro to move the start of the Zagorskaya PSPP-2 capacity supplies to 2017 (the first stage) and 2018 (the second stage).
The Zagorskaya PSPP No. 2 with project capacity of 840 MW and four 210 MW hydropower units is being constructed near Zagorskaya PSPP already in operation. The second stage of the Zagorskaya PSPP is constructed to eliminate the lack of flexible demand management capacity in the Center of Russia (according to System operator’s estimates the lack of capacity in the region amounts to 2.5-3.0 GW, including 1.5 GW in Moscow region) as well as to prevent from emergencies in Moscow and Moscow region.
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.
Shares / ADR