US Vice President JD Vance signed a civil nuclear cooperation agreement with Armenia on Monday, pledging as much as $9 billion in potential investment as the South Caucasus country seeks to reduce its long-standing reliance on Russia for energy, Bloomberg reports.

The accord, known as a Section 123 agreement, establishes the legal framework for US companies to export nuclear technology, fuel and services to Armenia. It opens the door for American firms to compete for a deal to replace the Soviet-era Metsamor nuclear power plant, which currently supplies about 40% of the country’s electricity, with small modular reactors. Vance emphasized that this format of cooperation strengthens the energy security of both the United States and Armenia and creates new jobs.

For his part, Armenian Prime Minister Nikol Pashinyan said the agreement opens a “new page” in US-Armenian energy relations and will diversify the country’s energy balance through the introduction of safe and innovative technologies.

Since the collapse of the USSR, Armenia has remained dependent on Moscow for energy. The Metsamor nuclear power plant is managed by the Russian state corporation Rosatom, and the plant’s nuclear fuel is supplied by Russia. Bloomberg reports that ahead of Vance’s visit to Yerevan, Rosatom representatives met in Moscow with the speaker of the Armenian National Assembly Alen Simonyan, proposing “comprehensive cooperation” in the nuclear energy sector.

Also, Pashinyan’s government has increasingly signaled its intention to switch to Western nuclear technology, citing the desire for diversification and energy sovereignty. As Bloomberg notes, Armenian officials consider this choice to be strategic, not just commercial.

Bloomberg adds that the nuclear agreement is part of US efforts to strengthen its presence in the South Caucasus, a region wedged between Russia, Turkey and Iran, amid shifting regional alliances. Washington and Yerevan are expanding defense cooperation also. According to Pashinyan, Armenia has received a batch of US drones worth $11 million.

Vance on Tuesday will visit the Armenian capital city Baku, where US and Azerbaijani representatives are expected to discuss defense and energy cooperation.