April 27, 2010, 2:21 AM EDT
By Anna Shiryaevskaya
By Anna Shiryaevskaya
April 27 (Bloomberg) -- Russian Prime Minister Vladimir Putin proposed creating a nuclear power holding company with Ukraine as the two former Soviet republics rebuild ties.
“We have made massive proposals, referring to generation, nuclear power engineering, and nuclear fuel,” Putin told reporters after a meeting with Ukrainian President Viktor Yanukovych in Kiev today. Any cooperation may be phased, Putin said after the surprise visit to Kiev.
Russia and Ukraine have reached agreements on natural gas subsidies and a navy base since Yanukovych’s election in February improved ties between the neighboring states. Putin also met yesterday with his Ukrainian counterpart, Mykola Azarov, to discuss industrial cooperation.
Putin and Azarov plan to meet in Sochi on the Russia’s Black Sea coast on April 30, where an intergovernmental commission will meet, Putin said. Russia and Ukraine are also discussing aviation and shipbuilding, he said.
Yanukovych said the proposals are “interesting.”
Ukraine currently operates four nuclear power plants with 15 reactors, according to the World Nuclear Association database. It was the site of the world’s worst nuclear accident when a reactor at the Chernobyl facility exploded on April 26, 1986, spewing radiation across eastern and northern Europe.
Nuclear Upgrades
Russia is ready to take “an active part” in upgrading Ukrainian reactors and will allow Ukrainian partners on the Russian market, Putin said. Nuclear cooperation in third countries is also possible, he said.
Russia plans to boost the share of nuclear power in total output to 25 percent from 15 percent to 16 percent now, Putin told reporters near Milan yesterday.
Ukraine will get $40 billion to $45 billion of investment from Russia in the next ten years because of a gas agreement reached last week, with fuel supplies subsidized by Russia’s budget, Putin said. This year, Russia will run a deficit that is wider than Ukraine’s, if the neighboring country takes into account the reduced gas price, he said.
Russian President Dmitry Medvedev and Yanukovych reached the gas agreement in Kharkiv, eastern Ukraine, on April 21. Russia agreed to cut the price of gas for Ukraine by as much as 30 percent, and in exchange Ukraine agreed to allow Russia to keep its Black Sea fleet at the Ukrainian port of Sevastopol until 2042, with a possible five-year extension. The fleet’s lease was set to expire in 2017.
“The price they proposed to regulate the issue is excessive,” Putin said. “I could eat Yanukovych and the prime minister together for that money. Not a single military base in the world costs as much.”
The Ukrainian government may ratify the accord today.
Debates planned on the fleet in Ukraine are “surprising,” as Russia discussed the extension with the previous government led by Yulia Tymoshenko and received no objections, Putin said.
“But it is not just about money to us,” Putin said. “Cooperation with Ukraine and cooperation in the military sphere improves the level of trust between our countries.”
Source: http://www.businessweek.com/news/2010-04-27/russia-proposes-merging-nuclear-energy-with-ukraine-update1-.html
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