Belarus seeks to revise terms of Russian nuclear loan

01 November 2018, Week 43, Issue 934

Belarus is looking to renegotiate its US$10 billion credit line with Russia, intended to cover the cost of its Astravets nuclear power plant (NPP) project.

Belarus plans to commission two Russian-built 1,200-MW reactors at the Astravets site in 2019 and 2020. Moscow agreed in 2014 to finance 90% of the project with a soft loan.

Addressing reporters on October 29, Belarusian Economy Minister Dmitry Krutoi said Minsk was seeking to extend the loan’s repayment period and reduce the interest rate, in order to lower the end price of electricity from the plant. He added he was hopeful that a revised deal could be reached with Moscow by the end of this year.

“This is important because the investment component [currently] accounts for about 40% of the cost of the electricity the nuclear power plant will generate,” he said. “Once the new terms of the loan are available, we will recalculate the investment component.”

Moscow has offered similar financial support to other countries developing Russian nuclear projects. It is providing a 10 billion euro (US$10.5 billion) soft loan to Hungary to fund the expansion of the Paks NPP, and has signalled recently it will issue another loan to Uzbekistan to help construct a new station.

Once both reactors are online, the Astravets plant will supply a third of Belarus’ energy needs, allowing the country to go without imports from neighbouring Russia. Some of the station’s power is also earmarked for sale abroad, though there are doubts about who will buy the energy. Lithuania has called for a regional boycott of electricity from the plant, located just 40 km from its capital Vilnius, blasting the project as a security threat.

For years, Russia has provided Belarus with cheap supplies of oil and gas, and other support in the energy sector, as a means of propping up its economy and keeping Minsk within Moscow’s geopolitical orbit.

Joseph Murphy

Edited by

Joseph Murphy


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