Krasnodar Approves $6Bln Isle

ST. PETERSBURG -- The Krasnodar regional government approved the construction of a 155 billion ruble ($6.3 billion) artificial island off the coast of the Black Sea resort of Sochi, according to a statement released last week.

A local government council concluded that the project, known as Federation Island, would have a "positive effect on the economy of Sochi and the region," developer M-Industria said Thursday.

Abu Dhabi-based Allied Business Consultants will fund the project, designed by Dutch architect Erick Van Egeraat. M-Industria heads a group of Russian and foreign companies with experience in building artificial islands in the United Arab Emirates, the Netherlands and Singapore.

The Russia-shaped island is part of preparations to host the 2014 Winter Olympics in Sochi. Russia has committed more than $12 billion for the Winter Games.

The planned 330-hectare territory, located along the Black Sea coastline where some of the Olympic venues will be built, will contain residential, business and entertainment facilities.

The developer plans to sign an agreement with the Krasnodar government and will start construction in the second quarter of this year. The island is due for completion in 2013.