Nabucco pipeline can be much smaller

• Tuesday, February 21, 02:12

Tbilisi. the consortium of Nabucco gas pipeline project proposed a much smaller project than the originally planned pipeline to carry Caspian natural gas to Europe, people familiar with the discussion told Dow Jones Newswires.

                According to the sources, the new proposal envisages the pipeline which will only run between Bulgaria and Austria and have roughly half of the initial capacity of 31 billion cubic meters.

                The reasons for these proposals are associated with low gas volumes available at the moment in the region and investors' little interest.

Nabucco gas pipeline is one of the Southern Gas Corridor projects, which is designed to transport gas from the Caspian region and Middle East to the European countries. The original concept of Nabucco project envisages the construction of the pipeline from the Georgian-Turkish and Iraqi-Turkish borders to the Austrian Baumgarten. The pipeline is expected to run through Turkey, Bulgaria, Romania, Hungary and Austria over a distance of 3,900 kilometers.

According to the source, the original project is still officially on the table.

The spokesman of the Nabucco consortium, Christian Dolezal confirmed that  different alternatives were considered, but further details were not given.

"We are in the process of calculating several scenarios, including different sizes in terms of capacity and length of the pipeline. However, our preferred scenario still is the base-case and no final decisions have been made, yet," Dolezal said.

                The construction of Nabucco pipeline is planned to start in 2013 and the first supplies will begin in 2017.  The gas to be produced during the second stage of Azerbaijani Shah Deniz gas condensate field development is considered as the main source for Nabucco. The estimated cost of the project is EURO 7.9 billion.

                The project's shareholders include Bulgarian Energy Holding, Turkish Botas, Austrian OMV, German RWE, Hungary's FGSZ and Romanian Transgaz.

                On October 1, Nabucco with the other pipeline projects (TAP, ITGI) submitted their final proposals to the Azerbaijani side, which will review them in accordance with the previously announced criteria. The decision on the preferable transportation route is expected to be made in the first quarter of 2012.