Wednesday, November 13 2019 16:56
Alexandr Avanesov

Finance Minister: RA Government does not exclude the possibility of  providing a budget loan to the ANPP to fill the deficit of financial  resources

Finance Minister: RA Government does not exclude the possibility of  providing a budget loan to the ANPP to fill the deficit of financial  resources

ArmInfo. The Armenian government does not exclude the possibility of providing a budget loan to the Armenian Nuclear Power Plant (ANPP) to fill the shortage  of financial resources. On November 13, Minister of Finance of the  Republic of Armenia Atom Janjughazyan stated this from the rostrum of  the Republic of Armenia, answering the question of MP of the National  Assembly of the Republic of Armenia from the Prosperous Armenia  faction Mikayel Melkumyan about the deficit of 6 billion drams needed  for the implementation of the program for the modernization of the  second power unit of the ANPP.

The Minister noted that, based on the results of the negotiations, a  solution to the problem will be found.  "Whether it will be a budget  loan or other sources of financing, I think in January 2020 we will  decide on this issue," Atom Janjughazyan noted, adding that the  volume of budget lending will depend on the volume of the loan, the  terms of the credit line and conditions. There is an agreement with  the Central Bank on the basis of which it is possible to finance at  an estimated rate of 5%.  

Earlier, ArmInfo, citing Deputy Minister of Territorial  Administration and Infrastructures of Armenia Hakob Vardanyan,  reported that  Armenia expects Russia's response to a request to  extend the deadline for the start of payments on a loan of $ 270  million provided in 2015 to implement  a program to extend the life  of the second power unit of the Armenian  nuclear power plant.  Hakob  Vardanyan, Deputy Minister of Territorial Administration and  Infrastructures of the Republic of Armenia, in  charge of the energy  sector, said this at a hearing in a  parliamentary commission on  regional and Eurasian integration on  November 1. 

According to him, according to the schedule, it was planned to  complete the program by December 31, 2019, but as a result of surveys  conducted in 2017 of more than 4,500 instruments and equipment, new  problems were identified, and therefore, there was a need to extend  the program for another 2 years. In particular, we are talking about  the temperature treatment (annealing) of the reactor in order to  increase its strength to resist neutron fluxes, modernize tower  cooling systems, install anti-seismic protection systems, and build a  new nuclear power substation.  The current substation, according to  the deputy minister, built in  the 1970s of the last century, has  exhausted its resource, and taking  into account its system-forming  role in the electric power industry  of Armenia, along with the  Shinuhayr substations and the Hrazdan TPP,  there is a need for the  construction of a new facility. The issue of radioactive waste  management also remains to be decided. 

In total, 90% of credit funds (from $ 270 million) and 10% of the  grant ($ 30 million) were used as part of the extension program. It  is expected that by the end of the year about $ 2 million will be  saved. The Armenian side will not make interest payments on the  entire, but only on the disbursed loan amount, since the project has  not been fully completed. The Armenian side is counting on  understanding from the Russian side, which, according to preliminary  data, is ready to consider extending the payment deadlines, but there  is no final decision. Meanwhile, starting from January 1, 2020,  Armenia should start paying both on interest rates and on the  principal amount of the loan. Complete modernization of the unit will  lead to more than 10% increase in its efficiency, which will make it  possible to service a loan without any problems.  The deputy minister  also emphasized that by December 31, 2019 the  contract with the  general contractor of the program, "Rusatom  Service" company (part  of the "Rosatom group" of companies) will  expire, with which an  additional agreement will be signed regarding  the continuation of  work. However, the new agreement will stipulate a payment term. The  fact is, Hakob Vardanyan continued, that the  company in the form of  payment for services under the main document  received $ 30 million,  which is stipulated by the condition of the  intergovernmental  agreement. Now the Armenian side will insist on  payments not by  years, but by the results of work. 

"The project  dragged on, and we paid for the company's services  annually," the  deputy minister said.  To recall, the Government of  the Russian Federation of Armenia for a  period of 15 years provided  the loan with a grace period for payments  in the first three years.   This deadline expires December 31, 2019.   Moreover, the annual  interest rate on payments is 3%. The main  objectives of the project  to extend the life of the 2nd power unit of  the Armenian nuclear  power plant are to restore the resource and  extend the operation of  the station to 10 years (until 2026),  increase the level of safety  and efficiency of nuclear power plants.  This year, it is planned to  replace the second turbogenerator at the  station, the automatic  control system, and carry out repair work on  the cooling towers. In  addition, work will be carried out to prepare  for the treatment of  the reactor dome, which will be heat treated  (annealed) in order to  increase its strength to resist neutron  fluxes.  Annealing itself  will be carried out in 2020. All work on the  project will be  completed by the end of 2021. In this regard, Armenia  intends to  raise the issue of transferring work and loan payments  from 2019 to  2021 before the Russian government.  The Armenian NPP  consists of  two units with Soviet (Russian) WWER reactors. The first  unit was  commissioned in 1976, the second in 1980. In March 1989,  after the  Spitak earthquake, the station was stopped. In November  1995, in  connection with the most acute energy crisis, the second  power unit  of the station with a capacity of 407.5 MW was activated.  In March  2014, the Armenian government decided to modernize the  station and  extend the life of the second power unit.

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Search by date

Government Bonds

Issue volume

10 billion

Volume of T-bills for placement

200 million

Volume of submitted competitive applications

200 million

Volume of satisfied bids

200 million

Yield at cut-off price

 5.8314%

Maximum yield

 5.8314%

Мinimum yield

 5.8314%

Weighted average yield

 5.8314%

Number of participants

2

The maturity date of T-bills

03.02.2020

ArmEx

 

СПРОС (Покупка)

USD

Средневзв. Цена

482,00

ПРЕДЛОЖЕНИЕ (Продажа)

  USD

Средневзв. Цена

-

СДЕЛКИ

USD

Цена откр.

482,00

Цена закр.

482,00

Мин. Цена

482,00

Макс. Цена

482,00

Ср/взв. Цена

482,00

-0.16

Кол-во сделок

1

Объем (инвал.)

200 000

0бъем (драм)

96 400 000

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