Russia’s MoD and USC disagree over Borey submarine price

28 May 2012 (Last Updated May 28th, 2012 05:45)

The Russian Defence Ministry and United Shipbuilding Corporation (USC) have again failed to finalise delivery contract terms of the new Borey-class (Project 955) strategic nuclear submarine despite President Vladimir Putin's intervention.

Russian Navy Borei-class submarine, Yuri Dolgorukiy The Russian Defence Ministry and United Shipbuilding Corporation (USC) have again failed to finalise delivery contract terms of the new Borey-class (Project 955) strategic nuclear submarine despite President Vladimir Putin's intervention.

According to RIA Novosti, price negotiations between the company and the ministry for the new Borey submarines were ongoing.

Russia's defence minister Anatoly Serdyukov told journalists that both parties have agreed to resume price talks by 2015.

"Should the industry be able to demonstrate it has incurred any substantial costs, we may accept them, that is, recalculate them," Serdyukov added.

Trade and industry minister Denis Manturov said that the Borey contract would be implemented in full with five submarines and a design contract.

"The president made a considered decision that makes it possible to sign a contract with the defence ministry until 2020," he said.

"Should the industry be able to demonstrate it has incurred any substantial costs, we may recalculate them."

The Russian Navy will receive ten new Borey-class submarines by 2020 as a part of a state 2020 rearmament procurement programme.

The fourth-generation nuclear-powered Borey-class submarines will replace the ageing Russian Delta III and Typhoon-class vessels.

Equipped with Bulava missiles, the new submarines are expected to boost the Russian submarine fleet and will form the core of the country's naval force after 2018.

Putin said that the new warships and submarines procurement would be a priority over the next decade, for which the government has funded $156bn of the entire armament procurement budget until 2020.

As part of the country's submarine procurement plan, the Navy will also be equipped with ten Graney-class nuclear attack submarines and 20 diesel-electric submarines, including six Varshavyanka-class vessels.


Image: A Russian Navy Borei-class submarine, Yuri Dolgorukiy undergoing sea trials. Photo: courtesy of Schekinov Alexey Victorovich.