Azernews.Az

MOSCOW – An investment decision on Nabucco will be made in 2011 and Russia could also ship gas through the pipeline at a later stage, Nabucco chief Reinhard Mitschek said Thursday.

The managing director of Nabucco Gas Pipeline International (NGPI), the project company, told Hungarian business daily Vilaggazdasag that Azerbaijan and Iraq, then Turkmenistan, would supply gas to the pipeline during the first phase of its operation, while Russia could supply gas via Turkmenistan during the second phase.

Mitschek said his company has not yet held direct talks with Russian suppliers regarding gas supplies to the Nabucco pipeline.

Mitschek said further that Iran is not currently considered as a supplier for the proposed pipeline due to political instability and the fact that Iran remains an importer of gas.

He said that NGPI was analyzing factors that could influence the cost of building the pipeline, noting that the estimated final cost of the project would likely be moderately higher than the previously projected 7.9 billion euros.

Mitschek said that NGPI is examining which of the three private companies in the consortium – Hungary's MOL, Austria's OMV, and Germany's RWE – would be required to provide a state guarantee of 1.7bn euros. He noted that the three state-owned companies also participating in the project– Turkey's Botas, Romania's Transgaz and Bulgaria's Bulgargaz – would obviously provide such guarantees.

The Nabucco pipeline would operate based on the one-window system in which NGPI would negotiate gas contracts with suppliers for the entire length of the pipeline, which rules out the need for signing transit agreements with each country located along the pipeline route, Mitschek said.

Mitschek said he was not concerned that the planned Azerbaijan-Georgia-Romanian Interconnector (AGRI) seeking to transport liquefied natural gas from Azerbaijan to central Europe via the Black Sea and Romania would draw investment away from the Nabucco project, adding that Europe needs gas from all possible sources.

The 3,300-kilometer Nabucco pipeline, which will run from eastern Turkey to the Austrian capital Vienna, is expected to come online in 2015. Deliveries by the pipeline, which will bypass Russia, will help European countries to diversify their supplies of energy. Maximal capacity of the pipeline will be 31 billion cubic meters of gas per year.