MOSCOW, January 23 (RIA Novosti) - Russia and Ukraine have formed a joint venture to resume production of An-124-100 Ruslan heavy cargo planes, which was halted in the early 1990s, the head of the Volga-Dnepr aircraft manufacturing consortium said Tuesday.

The An-124 was designed by the Antonov aircraft design bureau in 1982. Its modified versions, the An-124-100 and An-124-100M-150, were manufactured by Russia's Ulyanovsk-based Aviastar-SP and Antonov in Ukraine until the mid-1990s. Currently no An-124s are being produced.

Alexei Isaikin said Russia's Volga-Dnepr consortium and Ukraine's Motor Sich have formed joint venture Flying Cargo Vehicles, in which the Russian company will initially hold a 59% stake, and the Ukrainian company 41%.

The Volga-Dnepr chief said it would cost $500 million to implement the project.

"It was initially stated in the business plan that investment in the project would total $400 million, but it emerged later that we would need a larger sum," he said.

Last December Russia and Ukraine reached an agreement to jointly manufacture two An-124 Condor heavy transport aircraft.

The new version of the An-124, which is similar to the American Lockheed C-5 Galaxy, will feature advanced avionics, upgraded power units, increased payload capacity of up to 150 metric tons, an extended flight range, and a smaller crew.

According to various estimates, global demand for modernized An-124-100 aircraft is growing at an average rate of 15%-20% per year, and several dozen Condor aircraft may be needed by 2017.