RusHydro and China Three Gorges Corporation (CTG) will establish a joint venture (JV) to develop nearly 2GW of hydro projects in the Russian far east.

An agreement to this effect was signed between RusHydro and CTG.

Under the agreed terms, RusHydro will own a 71% stake in the JV, while the remainder 49% stake will be owned by CTG.

The companies will develop four hydroelectric dams in Russia’s Amur Oblast and Khabarovskiy Kray at an expected cost of £3.2bn.

Projects currently planned include the 400MW Nizhne-Zeyskaya, the 300MW Selemdzhinskaya, the 462MW Giluyskaya and the 600MW Nizhne-Nimanskaya.

The companies plan to raise about 70% of required funds as project financing from Chinese and Russian institutions backed by long-term power purchase agreements.

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RusHydro will prepare and provide detailed feasibility studies of each project while CTG will negotiate the electricity off-take contracts with its Chinese counterparts.

RusHydro CEO Evgeny Dod said: "Our Chinese partners will be actively involved on all stages of the projects’ development – engineering, procurement and construction.

"In addition to protecting vast territories, both on Russian and Chinese banks of the Amur River from catastrophic floods and contributing to development of modern power infrastructure the region, the projects will provide additional stimuli for economic growth and job creation."

RusHydro and CTG agreed to sign a cooperation agreement in October 2013 during their meeting in Beijing on potential construction of the reservoir-based hydroelectric facilities on the tributaries of the Amur river.

RusHydro said the massive flooding in the Far East of Russia and North-Eastern region of China in 2013 occurred by abundant rainfalls revealed the requirement to plan the measures in order to mitigate the risks of floods in the future.

Energy