Russia and Kazakhstan signed a $16.5 billion intergovernmental agreement on Thursday to construct the Balkhash nuclear power plant near the village of Ulken in southeastern Kazakhstan, the first commercial nuclear facility in Central Asia since the Soviet era. The deal was finalised during a state visit to Astana by Russian President Vladimir Putin.
Russia's state nuclear corporation Rosatom will lead construction of the plant, which will house two VVER-1200 III+ reactors. Rosatom secured the lead role after a competitive process that included China National Nuclear Corporation, French utility EDF, and Korea Hydro and Nuclear Power.
#Russia to Cover 85% of Costs Through State Export Loan
Kazakhstan's atomic energy agency chief Almasadam Satkaliyev told reporters the total project cost, including approximately $2 billion for security and infrastructure, would be around $16.5 billion. Kazakhstan has said Russia will provide 85% of the financing through a state export loan, with the plant expected to be commissioned between 2035 and 2036.
Construction is scheduled to begin in 2027, with the first reactor due to come online in early 2034, according to Satkaliyev.
Three agreements were signed in total: an intergovernmental accord setting out the key construction parameters, a separate agreement on the state export loan, and an action plan covering nuclear and radiation safety regulation for 2026 to 2030.
"The agreement signed today on the construction of the Balkhash NPP has an important role," Kazakh President Kassym-Jomart Tokayev said, thanking Putin for his support.
#Kazakhstan Seeks Return to Nuclear Power After 25-Year Gap
Despite being the world's top uranium producer, Kazakhstan has not generated commercial nuclear electricity since the closure of the BN-350 reactor in 1999, although it continues to operate several research reactors. The new plant was approved in a 2024 referendum, in which more than 70% of participating voters backed construction.
The country currently relies primarily on coal for electricity, supplemented by hydroelectricity and a growing renewables sector. Kazakhstan's government has cited rising domestic energy demand as the driver for the project.
China National Nuclear Corporation has been lined up to build a second plant, at an adjacent site in the same Zhambyl district, as well as a third facility.
#Financing Risks and Rosatom's Record Under Scrutiny
The deal faces documented financial and operational risks. Western sanctions imposed on Russia following its 2022 invasion of Ukraine have constrained Rosatom's financial capacity. Kazatomprom, Kazakhstan's state nuclear entity, filed a complaint in early 2026 alleging that a Rosatom-linked subsidiary failed to meet contractual obligations under a uranium mining agreement, including missing extraction quotas and contributions to an environmental remediation fund. The Rosatom-linked entity has disputed the claims.
Kazakhstan's newly established nuclear regulator must also draft safety frameworks, train inspectors, and build emergency response capacity from scratch, with analysts noting that even minor bureaucratic delays could affect the mid-2030s commissioning target.
Some analysts have questioned the choice of contractor. Researcher Togzhan Kassenova, author of Atomic Steppe: How Kazakhstan Gave Up The Bomb, has previously argued that Western sanctions against Russia mean Rosatom "should be a nonstarter for political and practical reasons."
In addition, analysts have noted that public hearings on nuclear expansion in Kazakhstan have reportedly restricted participation by critics of the project.
The three agreements signed under Thursday's deal, including the export loan terms, are subject to formal ratification and financing documentation before construction proceeds. Whether Rosatom can secure the financing required to begin new construction by 2027 remains unconfirmed.