Chairman of the Gazprom Management Committee, Alexey Miller and Member of the E.ON Management Board, Klaus Schaefer met this November to discuss the highly-anticipated, upcoming Nord Stream 2 pipeline project.
The proposed project, expected to be completed in 2019, would allow Russia to tap into their most lucrative market, Germany, transporting significant supplies between the countries via the Baltic Sea. Gazprom holds a 51% share of the project, whilst E.ON holds 15.5%.
Nord Stream 1
The first Nord Stream pipeline project was delivered in the early 2000s as a means of avoiding conflicts over Ukrainian transit of gas to Europe. The project was conceived as having two pipelines providing a combined capacity of 55 bcm/y and a length of 1,224 kilometres, making it the world’s longest undersea pipeline.
Nord Stream 2
The proposal for Nord Stream 2 would involve taking the same route as Nord Stream 1 and constructing the pipelines with the same carrying capacity, making the combined total capacity of both pipelines 110 bcm/y.
Financing the pipelines
Gazprom will struggle to find the €5 billion required for its share of the approximately €10 billion cost of the pipeline, due to the costs of other current projects, such as the Turkish Stream and the $55 billion Power of Siberia project. Many in the industry are questioning how Gazprom will be able to generate the capital required, either from external financing or internal funds.
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