The European Investment Bank on Thursday said that quarrels between European Union member states were blocking a funding of a disputed Russian-German natural gas pipeline.

Several EU member states were opposed to fund the project, said EIB vice president Matthias Kollatz-Ahnen.

So far, the EU bank had not received an official application for financing and was not holding talks with the developers of the project, Kollatz-Ahnen told reporters after the bank presented its annual report.

Poland leads the campaign against the project, developed by Russian energy giant's Gazprom subsidiary Nord Stream, as it fears that Russia could keep it from receiving gas.

The pipeline would bypass the former Soviet Baltic states Estonia, Latvia and Lithuania as well as Poland and Belarus.

Kollatz-Ahnen also said that the size of the project would fit into the EIB's range of activities.

However, the bank would have to assess the environmental impact of the pipeline. This could show that it would be better for the environment to build the pipeline above ground, Kollatz-Ahnen said.

The EIB's comment came just a day after Gazprom chairman Gerhard Schroeder, Germany's former Chancellor, was in Brussels to promote the controversial project.

Schroeder said that the Baltic Sea gas pipe would bolster EU energy security but not hurt the environment.

Gazprom plans to seek EIB funding to help meet the costs of the 12 billion-euros (US$15.6-billion) scheme.

The planned pipeline is to ship 27.5 billion cubic metres of the fuel annually from Russia's Arctic Shkotman deposit to Germany.

The EIB also called for talks with banks in China, warning that Chinese loans to African countries could undermine European efforts to improve governance standards in African states and could put the poor continent in excessive debt.

In 2006, the EIB lent a total of 45.8 billion euros for projects mainly in the area of infrastructure and research and development.

While the overall spending is likely to stay the same this year, the EIB said that it plans to drive up lending on energy projects to 4 billion euros in 2007 from 3 billion last year. Up to 800 million euros would go into renewable energy projects.

Copyright 2007 dpa Deutsche Presse-Agentur GmbH

Related Project
Nord Stream Pipeline
Facility Type: Pipeline Owner: Nord Stream AG
Scope: New Construction Location: Vyborg, Russia to Greifswald, Germany Russian Federation