E.ON Still Expects Baltic Pipeline to Be Completed
by AFX News Limited
December 13, 2007
E.ON AG's Ruhrgas unit still expects the
planned Baltic pipeline to be completed following news the project's cost will
exceed the originally planned EUR 5 billion, unit head Burckhard Bergmann said.
"The pipeline will be built, and relevant orders have already been placed,"
said Bergmann, who is the only foreigner on Russian gas giant Gazprom's
Gazprom holds a 51-percent interest in the Nord Stream joint venture, which from
2010 is to connect Russia's Baltic coast to Germany and other European countries
via the Baltic Sea. BASF AG and E.ON each hold 24.5 percent of the project.
The Nord Stream consortium earlier this week confirmed reports the project
will be more expensive than originally planned because prices of metal, cement
and other necessary materials have increased.
The pipes themselves and logistics comprise the main project costs. A
spokeswoman for Nord Stream said the consortium is set to sign in February a
contract for the installation of pipes by Italy's Saipem. Logistics costs will
probably be fully calculated by the first quarter as well.
Bergmann declined to comment on reports the project's cost may reach EUR 8 billion.
The Nord Stream Project has met resistance from the Baltic states and
Poland, which have asked the European Commission to study alternatives, citing
ecological risks. German Chancellor Angela Merkel and Polish Prime Minister
Donald Tusk held talks this week on the topic.
"This is not about Poland getting a share of the project," Bergmann said.
"This is primarily about the integration of Poland into European gas supplies."
Bergmann also said E.ON Ruhrgas currently has no plans to raise or lower its 6.43-percent stake in Gazprom.
Copyright 2007 AFX News Limited. All Rights Reserved.
Nord Stream Pipeline
Nord Stream AG
Vyborg, Russia to Greifswald, Germany Russian Federation