Are you sure?

Gazprom gas pipeline linking Russia with Germany may face delay

OAO Gazprom's Nord Stream pipeline, a €5 bln ($6.5 bln) natural gas link connecting Russia and Germany, may be delayed on environmental grounds, said European Union Energy Commissioner Andris Piebalgs.

The scheduled 2010 start date for the pipeline, with capacity to ship 55 billion cubic meters of gas a year, is „optimistic,” Piebalgs said late yesterday in an interview in Madrid. Objections raised by Sweden to the construction of the 743-mile (1,195-kilometer) pipe under the Baltic Sea may force Gazprom, Russia's biggest gas-export monopoly, and German utility E.ON AG to revise their plans, he said. BASF AG, the world's largest chemical producer, is also participating in the project. Sweden may be able to demand a redesign or a new route since the pipeline passes through its economic zone. Gazprom wants to build the pipeline to avoid transit through countries such as Belarus and Ukraine, and avoid pricing disputes that disrupted energy supplies this year and last. „At the end of this year they will have a better idea of a final date, when they have carried out more studies,” Piebalgs said. He met Nord Stream Chairman Gerhard Schroeder, the former German chancellor, earlier this week to discuss the project.

The pipeline would transport gas, equal to 62% of Germany's demand for the fuel in 2006, according to the BGW German gas industry association. Europe depends on Russia for a quarter of its gas needs. Baltic Sea states have been asked to make an environmental assessment of the project. Sweden is worried that laying the pipe on the seabed may unsettle an area littered with mines from two world wars and disrupt fishing. „We will have a comprehensive report on the environmental impact by the autumn of 2007,” said Irina Vasilyeva, a spokeswoman for Nord Stream, by phone. She said the 2010 start date „is ambitious, but we believe we have the necessary resources.” Gazprom spokesman Sergei Kupriyanov wasn't immediately available for comment. The proposal includes a maintenance platform off the Swedish island of Gotland, 56 miles east of mainland Sweden. Schroeder said February 7 that the timetable for building the pipeline remains realistic. „We plan to complete the project on time,” he told reporters in Brussels. „We do not believe that this is impossible.” Schroeder left open the possibility of a delay, saying Nord Stream would have to allay the environmental concerns in Sweden. „This is a very large-scale project,” he said. „We are going to be learning as we go along.” (Bloomberg)