3 Russian firms investing in Ust-Luga ferry project

Private investments totaling USD 40 million are foreseen for the creation of the Ust-Luga/Baltisk/German Ports Ferry, Aleksandr Zamurayev, general director of Baltic Ferry, told journalists last week. He said the main investors were three Russian companies that, over the next 45 days, are to complete acquisition of a portion of Baltic Ferry. 'We have also invited the administrations of the port of Kiel (Germany) and Zasnitz (Germany) to take part in the financing,' Zamurayev said. He said the full roster of shareholders would be known before the end of this year, with the Ust-Luga Co. continuing to hold a controlling interest. The federal budget has allocated USD 35 million for related construction work.

As Aleksandr Brakhno, vice governor of the Leningrad Region, has stated, the draft budget of the Russian Federation for 2004 includes approximately USD 33.3 million for the construction. This year's budget allocated USD 9 million for it. Dredging is to begin this month, and work on an approach canal is to be underway next year.

It is expected that USD 75 million for the ferry line, which has been guaranteed by the Russian government, will be provided by the European Bank for Reconstruction and Development. Zamurayev said talks with the bank were continuing but that the credit would not be received before 2005, since the budget of the Russian Federation for 2004 does not include the guarantee.

The first stage of the Baltic Ferry (automobile transit) is expected to be active in 2006, with the second stage (automobile and train service) in 2006-2007. Baltic Ferry, which is building the ferry line, is owned by the Ust-Luga Co.

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