RusHydro, Polyus Gold and Administration of Magadan region signed a cooperation agreement
JSC RusHydro (ticker symbol: MOEX, LSE: HYDR; OTCQX: RSHYY) announces that it has signed a cooperation agreement with Polyus Gold and Administration of Magadan region. The document was signed by Evgeny Dod, CEO of RusHydro, Vladimir Pecheniy, the Governor of Magadan region, and German Pikhoya, CEO of Polyus Gold.
The cooperation is aimed at development of transport and power infrastructure, improvement of social and economic conditions and lowering growth rate of tariffs for consumers as well as implementation of investment projects in Magadan region. The key project is construction of the Ust-Srednekanskaya hydropower plant with the installed capacity of 570 MW.
Under the cooperation agreement RusHydro plans to finalize the construction of the plant. Administration of Magadan region intends to set long-term tariffs for JSC Ust-Srednekanskaya HPP and JSC Magadanenergo for direct sale and purchase of electricity (capacity) with JSC Matrosova mine (Polyus Gold) starting from 2014. Polyus Gold plans to implement the construction of gold mining enterprise at Natalka gold deposit.
The Ust-Srednekanskaya HPP on the Kolyma River is currently under construction, and is located 200 km downstream the site of active Kolymskaya HPP. The full installed capacity is 570 MW with the average annual output of 2.5 GWh; he plant will be equipped with 4 hydropower units. The first phase of 169 MW comprising two units is planned to be launched in 2013. Completion of construction is planned for 2018.
The plant is expected to provide energy for the developing mining operations in the region. In addition, the plant output will enable development of new unique operations, such as facility for production of liquefied hydrogen. In June 2013, RusHydro and Kawasaki Corp. signed an agreement on development of liquefied hydrogen in the region, that will be supplied from the hydropower plant.
Another important function of the dam is regulation of the Kolyma river flow, which is important for shipping. Increase in hydropower generation capacity will eliminate the need for construction of thermal generation plants in the region, thus reducing consumption of fuel and reducing the growth of electricity tariffs.
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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