Russia amends terms for Belarus NPP loan agreement

29 March 2021

Russian President Vladimir Putin has signed a law on the ratification of a protocol amending the Russian-Belarusian intergovernmental agreement on the loan extended by Russia for the construction of the Belarus NPP. The document was published on 24 March on the Russian Official Internet Portal of legal information. The protocol was signed on 14 July 2020 and was approved by parliament earlier in March 2021. The protocol extends 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% a year, and the start date of the repayment of the principal debt on the loan has been deferred from 1 April 2021 to 1 April 2023. If debt is not repaid on time, after 180 days, the entire amount, including any interest on the loan and its servicing, will be consolidated and must be repaid immediately, the document states.

The 2011 intergovernmental agreement on the construction of the Belarus nuclear power plant provides for cooperation in the design, construction and turnkey commissioning of two power units with a capacity of 1200MW each. For these purposes, Russia issued 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, with 10% paid by Belarus. Repayment was supposed to begin six months after the power plant was put into operation, but no later than 1 April 2021. Repayment was to be in 30 equal shares every six months with 50% of the amount attracting interest at a rate of 5.23% a year and the rest at the LIBOR rate for 6-month deposits in US dollars, increased by a margin of 1.83% a year. Belarus asked for the loan to be restructured because of the decrease in the level of world prices for oil and gas, as well as the postponement of the commissioning of two units from 2018 to 2022.

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

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