RusHydro says RUSAL approved all conditions for Taishet smelter

MOSCOW, Dec 22 (PRIME) -- Russian aluminum giant UC RUSAL has approved all conditions that hydropower giant RusHydro set for its participation in construction of the Taishet aluminum smelter, RusHydro CEO Nikolai Shulginov told reporters on Friday.

“They’ve approved them. We are now to take them into account while developing necessary documents, and if we don’t, we will stop,” he said when asked whether RUSAL approved all conditions set by RusHydro.

Now the project is undergoing an independent audit of historical costs, which will take more time than expected, so the companies will not be able to make a final decision in 2017, he said.

Construction of the Taishet aluminum smelter began in 2006 but was suspended in 2009. RUSAL plans to attract project financing amounting to about U.S. $700 million to complete it.

The board of directors of RusHydro approved the company’s participation in the project in August, but set seven conditions that should be implemented immediately, including a requirement that half of the project should not cost over $388 million.

The list of the conditions also includes the possibility for the company to pay for the stake with 42.75% in Irkutsk Power Grid Company and with further income from the plant amounting to no more than $150 million. The company also wanted to pay the remaining part of the cost of $88 million in installments during no less than the three years following the plant’s launch.

RusHydro also did not want to act as a guarantor for project financing for the plant, and wanted to withdraw from being a guarantor to Vnesheconombank (VEB) under the Boguchansky smelter project – another joint venture with RUSAL.

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