VTB Group has extended two loans to subsidiaries of RAO Energy System of East, a holding company that manages the Far Eastern assets of Russia's hydropower giant RusHydro.

Far Eastern Generating Company secured a loan of RUB 7 billion for a term of three years, and Sakhalinenergo received RUB 700 million also for three years. Both deals will be secured with Rushydro guarantees. The borrowed funds will be used to finance the companies' operations.

«Financing Rushydro is among VTB Group's priorities in the energy sector," said Yuri Soloviev, First Deputy President and Chairman of the Management Board of VTB Bank. «We have enjoyed long-standing and successful cooperation with the company and hope to further expand our mutually beneficial business negotiations».

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Established on July 1, 2008 through a reorganisation of RAO UES of Russia, RAO Energy System of East now includes Far Eastern utility companies such as DRSC, DGC, DEK, Yakutsk Energo, Magadan Energo, Kamchatsk Energo, Sakhalin Energo, Peredvizhnaya Energetika and a number of energy retail suppliers and

non-core assets.

The company manages generating companies to meet the demand for electricity and thermal energy in the Far Eastern Federal District and adjacent areas.

The installed capacity of its power plants totals 9,087 MW, and its heat capacity, 17,892 Gcal/hour. The company manages over 102,000 km of power grids. Its principal shareholder is RusHydro.

Far Eastern Generating Company (DGC) is Russia's fourth largest territorial power generator in terms of installed capacity (5,864.58 MW; 12,585.1 Gcal/hour) and the largest operator in the Far Eastern energy market. A subsidiary of Energy System of East, it generates electric and thermal energy and provides centralised heating supplies to the southern areas of Russia's Far East. The company runs 15 power plants and 7 large boiler plants in five different regions (the Amur and Jewish Autonomous Regions, the Khabarovsk and Primorye Territories, and the south of the Sakha Republic).

Sakhalinenergo is the largest guaranteeing supplier of electricity in the Sakhalin Region. A subsidiary of Energy System of East, it provides centralised power supplies to 18 of the 23 municipalities in the Sakhalin Region as well as heating supplies for Yuzhnosakhalinsk and Vostok.

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