Gazprom Can Speed up Construction of New Pipe Line :: Charter'97 :: News

Gazprom can expedite construction of a ground part of the pipeline Nord Stream which is to convey oil from Russia to Germany under the North Sea. It is connected with the fact that in 2009 demand for large-diameter pipes in Russia would reach the peak level, and Russian manufacturers could be unable to meet demands of the gas concern. Analysts think that rescheduling works for an earlier term would allow Gazprom to make the project cheaper, as price of pipes is growing quickly. Besides, the earlier the Nord Stream would be put into operation the earlier the possibility to cut down transit via Belarus and Poland would appear, “RBK daily” writes.

Nord Stream (earlier called as Northern European pipeline) is one of the most expensive projects of Gazprom. Project partners of the company are German companies BASF and E.ON which own 24.5% in the project each. In 2010 it is planned to put in operation the first pipeline with an annual transportation capacity of about 27.5 billion cubic metres. The project envisages construction of a second pipeline and increase of the transportation capacity up to 55 billion cubic metres by 2013. The expected cost of the ground part of the pipeline is Euro 4.5 billion.

By November 2006 148.2 kilometres out of 917 kilometres of a new pipeline Gryazovets-Vyborg which is to connect Nord Stream with the single system of gas transportation have been put in commission. In the next year the “Programme on synchronising of commissioning of new facilities in production and transportation in 2007-2010” does not plan putting in operation of Nord Stream pipeline. However, closed joint-stock society Yamalgaz-Invest, a project owner, put forward an initiative to accelerate contraction of its linear part.

As the CEO of the company Leonid Chugunov told to Gazprom corporative magazine putting in operation of 166 kilometres of Nord Stream is planned in 2007, and 287 kilometres in 2008. “The necessity to speed up works is explained by the fact that in 2009 demand for large-diameter pipes in our county would reach the peak level, and Russian manufacturers could be unable to meet demands of the gas concern,” Chugunov said.

Analysts think that rescheduling works for an earlier term would allow Gazprom to make the project cheaper, as price of pipes is growing quickly. “It takes time to order and deliver pipes, while pipes manufacturer advance prices for heir products. That is why it’s logical Gazprom should accelerate construction of the pipeline in order to diminish the cost of the project,” the analyst of “Ak Bars Finans” Alexandr Blokhin notes.

As said by him, even if pipeline would be constructed earlier and the pipe would not be filled entirely, it is not so important, as the primary task is to diminish costs of construction. Besides, the earlier the Nord Stream would be put into operation the earlier the possibility to cut down transit via Belarus and Poland would appear, Alexandr Blokhin said.

It would not be difficult for Russian manufacturers of large-diameter pipes to deliver products for the ground part of he pipeline earlier, Yuriy Vlasov from “Renessans Kapital” is sure. Besides, as said by him, Gazprom would diversify pipes deliveries placing orders in several companies. At the moment in Russia large-diameter pipes are produced by United Metallurgical Company and Severstal. Besides, Pipe Metallurgical Company plans to start production of pipes necessary for this Gazprom project.