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Pulkovo Airport is One of the World Best PPP Projects

International Financial Corporation, a member of the World Bank Group, and Infrastructure Journal today highlighted the achievements of 40 public-private partnerships in emerging markets that demonstrate best practices for governments that collaborate with the private sector. Four independent regional judging panels of PPP experts selected the following projects for special recognition from the 40 featured projects. Each of the projects recognized demonstrated high levels of innovation, development vision, replicability, and social impact.

The PPP for Pulkovo Airport has been awarded the silver medal for the region Asia, Middle East & North Africa.

John Kjorstad, editor of Infrastructure Journal: We have chosen the most innovative and exciting PPP infrastructure projects from around the world. Increasingly governments are turning to PPPs as an affordable funding method. This comprehensive study of partnerships in emerging markets highlights best practice and will be an inspirational and invaluable tool for decision makers in both governments and the private sector. Beginning April 29, 2010 Northern Capital Gateway LLC — the Pulkovo Airport Operator carries out major reconstruction of the Airport according to the Public-Private Partnership Agreement. In order to increase the Airport capacity and improve passenger service quality Northern Capital Gateway LLC performs modernization of existing terminals and construction of new terminal, north boarding gallery and concomitant infrastructure. The total area of terminals will be increased up to 160 thousand square meters. The new terminal with a capacity up to 17 million passengers per year will be started up in December 2013.

Andrea Pal, CFO of Northern Capital Gateway LLC: Pulkovo Airport was not only the first major PPP in the country backed by international banks, it was the first that did not require state subsidy or guarantees, the first financed by commercial as well as development banks, and the first to be signed under the city of Saint Petersburg’s PPP law. We are proud to receive this award and will work hard to achieve the development and modernization of Pulkovo airport in time for the citizens of St. Petersburg. So far, Pulkovo Airport Development Project received many international awards. Thus, in 2011 Infrastructure Journal recognized VTB Capital, VTB Group investment business, as winner of the Deal of the Year — Transport for the financing of Pulkovo Airport reconstruction project. In February 2011 VTB Capital was awarded the European Airport Deal of the Year by Project Finance (Euromoney), a key journal for infrastructure financing. In March 2011 the Project picked up two highest awards of The Infrastructure Investor magazine as the Best Global PPP Transaction of the Year and the Best European PPP Transaction of the Year. In 2012 Pulkovo became the only one Russian project entered Top 100 Innovation Projects aimed at improving urban infrastructures all over the world according to the KPMG Infrastructure 100: World Cities Edition.

PPP Project of Pulkovo Airport Development In 2006 Transport Board under the Government of St. Petersburg approved the general plan of Pulkovo Airport development. Project implementation was started with announcement of the international tender for development of the architectural concept for new passenger terminal and adjacent infrastructure. Four architectural bureaus took part in the competition and project of the British company Grimshaw & Partners Ltd. was chosen as a winner. In 2009 Northern Capital Gateway Consortium consisting of VTB Capital, the international airport operator Fraport AG and the investment and business group Copelouzos was officially announced as the investor of Pulkovo Airport Development and Reconstruction Project. Northern Capital Gateway LLC, Pulkovo Airport JSC and Government of Saint Petersburg signed the Agreement on creating, re-construction and exploitation of objects which are included in the property of the Pulkovo Airport. PPP Agreement is signed up to 2039. In accordance with the provisions of the Agreement, since 2013 the Company shall pay to the Saint Petersburg Government in the name of Airport Pulkovo JSC the fee amounting 11,5 % of aeronautical revenue besides taxes paid to different levels budgets.

Use of PPP procedures with respect to attraction of private investments for airport development is rather new approach in world practice. Pulkovo Airport Development Project under the PPP is the fist in Russia.

In 2010 Northern Capital Gateway started the operating activity at Pulkovo Airport. Two passenger terminals, airfield complex with two parallel runways and all other concomitant infrastructure were placed under the Consortium management.