Russia estimates a contract with France on the construction of four Mistral class helicopter carriers for the Russian Navy to be worth at least 1.5 billion euros, First Deputy Defense Minister Vladimir Popovkin said.
Russia and France signed an intergovernmental agreement in January to jointly build two Mistral-class helicopter carriers at the STX shipyard in Saint-Nazaire, France. Another two are to be constructed later at the Admiralty Shipyards in St. Petersburg.
"The contract stipulates the purchase of two ships built by France's DCSN and the licenses for construction of two additional ships in Russia for at least 1.5 bln euros," Popovkin said in an interview with the Military-Industrial Courier publication.
The official reiterated that Russia would buy the ships with all the original navigational and other technical equipment, including the SENIT 9 naval tactical data system.
The design of the helicopter deck will be slightly changed to accommodate Russian helicopters, and the hull will be reinforced to allow the use of the ships in the Arctic, Popovkin said.
Meanwhile, Russia's Kommersant business daily said on Thursday that last week's contractual talks between Russian state-arms exporter Rosoboronexport and French DCSN company, which were attended by government officials from both countries, resulted in a deadlock.
The talks reached an impasse after France increased the total price tag from 980 mln euros to at least 1.15 bln euros for the first two ships to be built in France, the Kommersant newspaper said, citing sources close to the talks.
France is expected to put forward the final commercial proposal on March 15, but the price issue might demand a new political decision reached on the highest level of authority, which would throw the negotiations back to the start.
The dispute over the price tag is the result of "an unprofessional approach to the contract by the Russian Defense Ministry," Kommersant says.
In December 2010, deputy chief of the Russian Navy, Vice Adm. Nikolai Borisov signed a protocol with France, which established the price of the contract at 1.15 bln euros. The price included the construction cost of two ships (980 mln euros), some unidentified logistics expenses (131 mln euros, and crew training expenses (39 mln euros).
Borisov had no authority to sign the document, and did it without consulting with Rosoboronexport and the Federal Service for Military-Technical Cooperation.
The French side now has a legal basis to increase the price of the contract.
In addition, Russia wants the price of the construction licenses and technical documentation to be included in the contract, while France insists they should be sold separately for an additional 90 mln euros.
Experts believe that the controversial issues of such a highly-publicized and politically-charged deal could be resolved only through a compromise between the Russian and French leaders.
A Mistral-class ship is capable of carrying 16 helicopters, four landing vessels, 70 armored vehicles, and 450 personnel.
Russia plans to deploy the first two Mistral ships in the Pacific to protect the four disputed Kuril Islands.
MOSCOW, March 3 (RIA Novosti)