| Moscow, 15 May 2007. Anatoly Chubais, Chairman of the Management Board of RAO "UES of Russia", Alexander Khloponin, Krasnoyarsk Kray Governor, Maxim Bystrov, Deputy Head of the Federal Agency for Management of Special Economic Zones, Vyacheslav Sinyugin, Management Board Chairman of OAO "HydroWGC", and Oleg Deripaska, Board Member of UC RUSAL, and Alexander Bulygin, Director General of OAO "US RUSAL" have visited the construction site of the Boguchanskaya HPP and reviewed the progress made to date. The HPP is being built by OAO "Hydro WGC"* and UC RUSAL** as part of the Boguchansk Energy and Metal Complex (BEMO)*** project.
Since the project to complete the plant was restarted in December 2005, the dam has been reinforced with 110,000 cubic metres of hydraulic and bituminous concrete, 2 million cubic metres of earth works have been finished, over 2,000 tonnes of supporting metal infrastructure have been installed, and the principal equipment for the power plant has been ordered. In 2006, investments in the power plant construction made about RUB5 billion. In 2007, investments are expected to grow twofold to RUB10 billion. According to the approved schedule, in 2007, the volume of works in most project areas will increase 2-2.5-fold.
The delegation also took part in the official ceremony to kick off the construction of the Boguchansk Aluminium Smelter (BoAS). The 600,000 tpa-strong smelter will be one of Russia’s five largest. Total investment in this project is expected to reach USD2.3 billion. The project feasibility study was prepared by the All-Russia Aluminium and Magnesium Institute (VAMI), a subsidiary of UC RUSAL, and Bechtel, the international engineering company.
The smelter will include a reduction area, a baked anode production plant, a casthouse, and power supply and related auxiliary facilities. The smelter will be fitted with RA-300 reduction cells, a UC RUSAL proprietary technology and one of the world’s top three most efficient and clean electrolysis technologies. Commissioning of the smelter is expected to take place in December 2009, with full capacity to be reached in Q2 2011.
"Boguchansk Aluminium Smelter is one of the five facilities that the United Company is simultaneously building in different regions of Russia. I am confident that the experience we gained in constructing our Khakassia Aluminium Smelter will ensure success of this new project. It is symbolic that Boguchansk Smelter foundation stone is being laid on the 75th anniversary of the launch of the Volkhov Aluminium Smelter, Russia’s first. This marked the birth of aluminium production in Russia and is an auspicious day for our now world-leading industry”, said Alexander Bulygin, UC RUSAL CEO.
"I am pleased to say that HydroWGC is taking part in developing what will become the main consumer of energy generated by the Boguchanskaya HPP. I am sure the project will play a key role in unlocking the significant potential of the Lower Angara area”, said Vyacheslav Sinyugin, HydroWGC Management Board Chairman.
Investment in the project in 2007 will amount to about RUB5 billion. By the year end, contracts will be made with the leading global and Russian equipment manufactures. Also, 60 percent of earth works will be completed, foundations will be laid for the reduction area and casthouse, and a railroad will be constructed to the smelter. By the year-end, it is planned to commission the housing for the anticipated work crew.
* Federal Hydrogeneration Company (OAO "HydroWGC") was established pursuant to Russian Government Order No. 1254-r of 1 September 2003 and is a wholly-owned subsidiary of RAO "UES of Russia". OAO "HydroWGC" unites 49 Russian hydropower plants and is the country's largest generation company in terms of installed capacity. In 2006, every 14th kW/h generated in Russia was produced by HydroWGC’s plants.
** United Company "RUSAL" (www.rusal.com) is the global leader of the aluminium industry, accounting for approximately 12.5% and 16% of the global aluminium and alumina production, respectively. RUSAL sells its products in 70 countries worldwide. The company was founded in March 2007 through the merger of RUSAL, SUAL, and the alumina assets of Glencore. UC "RUSAL" employs 100,000 people and maintains presence in 17 countries across five continents. The company is headquartered in Moscow.
*** In May 2006, HydroWGC and RUSAL signed a Cooperation Agreement to jointly build the Boguchansk Energy and Metals Complex ("BEMO"). The project is being implemented by the companies on the parity basis. The BEMO project involves the completion of the Boguchanskaya HPP (installed capacity of 3,000 MW) on the Angara River, and the construction of an aluminium smelter with a capacity of 600,000 mt of primary aluminium annually, which will be a key consumer of the electricity generated by the plant. Phase 1 of the hydropower plant and smelter project is scheduled to be completed in 2009.
The project is a good example of cooperation between the state and the private sector. In 2006-2009, the Russian Federation Investment Fund will provide RUB34.41 billion (USD1.3 billion) in funds to finance the creation of the necessary power network infrastructure. The BEMO project will become a key element of a Comprehensive Development Programme for the Lower Angara region, which also includes plans to build a pulp and paper mill, develop the gas condensate fields and iron ore deposits, and construct a railway and motor roads. The BEMO project will create 10,000 new jobs and ensure additional tax payments to the local, regional and federal authorities.
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