On 29 December Russia and China have finally signed the long awaited contract for the supply and installation of two reactors. The two VVER-1000 reactors will be built at Lianyungang in the Jiangsu province. The contract is worth $2-3 billion.

Following the signing ceremony in Beijing, Russia’s First Deputy Prime Minister Boris Nemtsov said that the contract was the result of “an unprecedented struggle with our rivals using everything to block it including Chernobyl”. Despite this, he added, there is also a strong possibility of a further contract to build two and maybe four more units.

Construction will begin next year and the first unit will be commissioned in 2005 followed by the second in 2007. Nemtsov said that, “for our country the contract is extremely significant, because our science and high-technology production facilities are foundering, and now they will get something to do.” Russian Embassy spokesman Vladimir Zakharov said individual equipment purchases will still have to be negotiated. Germany’s Siemens is expected to provide the plant’s I&C system. Russia will provide $1.8 billion in financing. The first stage of the project will cost around $2.2 billion.

The contract is the first step in China’s ambitious plan to build as many as 150 reactors over the next 40 years. The deal was viewed as a setback to US competitors. Although none tendered for the Jiangsu plant, Russia believes that the contract will make it more difficult for the US to break into the market.

Russia is already looking to future co-operation with China. “We are studying the construction of a BN-800 fast reactor and a facility to reprocess the spent fuel,” Viktor Mikhailov, Atomic Energy Minister, said. “This will be enough for the next few years.”