Hungary’s Atomic Energy Authority has granted construction licenses for two new reactors at the Paks nuclear power plant, which are being built by Russia’s Rosatom group, Reuters reports.

Located 100 kilometers south of Budapest, the Paks nuclear power plant was built in the 1980s by the Soviets and supplies almost 40% of Hungary’s electricity needs. In December 2014, Russia and Hungary signed the contract for the construction of two new units at the Paks nuclear power plant, each with a capacity of 1.2 Gigawatts. According to the original schedule, construction was to begin in 2018 for the first unit to be completed in 2025.

Despite significant delays, the contract awarded without a tender to the Russian state group Rosatom is given as an example of the close ties between Hungarian Prime Minister Viktor Orban and Russian President Vladimir Putin. Initially, the project was delayed by a long evaluation procedure carried out by the European Union and focused on the method of financing, according to Agerpres.

The Hungarian Atomic Energy Authority announced on its website late Thursday that the current two-gigawatt nuclear power plant at Paks can be expanded with two new reactors, pending new licenses.

Nuclear power is not subject to EU sanctions.

The plans for the two new nuclear reactors serve Hungary’s strategic interests, the Hungarian Minister of Foreign Affairs and Trade, Peter Szijjarto, said in May, after the meeting with the management of Rosatom.

According to the agreement signed in 2014 between Moscow and Budapest, for the financing of the project to be carried out by the Russian company Rosatom, Hungary will receive from Russia a loan worth 10 billion euros, which will be returned by the Hungarian state until 2046, with an annual interest rate between 3.9% and 4.9%.