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Thursday, December 13, 2007

Russia unaffected by Nabucco trans-Caspian gas pipe project

BUDAPEST, December 7 (RIA Novosti) - A trans-Caspian gas pipeline project bypassing Russia would not hurt its interests or the interests of the country's energy giant Gazprom, a deputy industry and energy minister said on Friday. "That point of view only exists in the minds of the media," Ivan Materov said. The $6 billion pipeline project is expected to link energy-rich Central Asia to Europe through Turkey, Bulgaria, Romania, Hungary and Austria. Construction is scheduled to begin in 2009, enabling the pipeline to go on stream in 2012. The official also said that Russia does not regard the Nabucco project as a rival or alternative to the South Stream project, which is designed to carry gas to southern Europe from Russia. He said gas pumped along the Nabucco pipeline would be too expensive and uncompetitive, compared to South Stream. The European Union wants the project to diversify its supply routes away from Russia and to boost European energy security. Russia's energy giant Gazprom and Italy's Eni signed a deal in late November to set up a joint venture to conduct a feasibility study for South Stream at a ceremony in Moscow attended by President Vladimir Putin and Italian Prime Minister Romano Prodi. The pipeline is set to cover over 900 km (560 miles) under the Black Sea from Russia to Bulgaria and supply 30 billion cubic meters of gas annually. Possible routes for the land section of the pipeline in Europe are still being discussed. The project is set to strengthen Russia's position as Europe's main energy supplier. The country already provides 40% of the continent's natural gas needs. Russia has sought to build direct export routes to the EU since bitter disputes with the ex-Soviet republics Ukraine and Belarus, which affected supplies to Europe. European nations have expressed concerns over growing energy dependence on Russia and sought to diversify supplies to enhance their energy security. The Russian Kommersant daily said on Thursday that Hungary's oil and gas company MOL had suggested merging at least eight gas transportation companies in Central Europe into a consortium, tentatively called New Europe Transmission System, in a bid to secure more beneficial loans, including for Nabucco.

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