OOHHH COMMODITIES - Costs Nearly Double For Nabucco Project
nabucco-pipeline.com
Nabucco Gaspipeline International GmbH., a consortium to build and operate the 2,050-mile-long Nabucco pipeline to bring Caspian area gas to western Europe, said the project’s cost is now estimated at 7.9 billion euros ($12.3 billion), compared with a previous forecast of 4.6 billion euros ($7.1 billion), according to the website.
"The Nabucco feasibility study, undertaken in 2005, anticipated an investment requirement of about $5 billion euros ($7.8 billion) for the construction of the whole length of the pipeline,” said Reinhard Mitschek, Managing Director of Nabucco Gaspipeline International, in response to the decision of the Steering Committee Meeting. “Since then, crude oil prices have more than doubled - which consequently has also led to higher prices for all primary energy sources. In addition, steel is in high demand because of the large numbers of big projects and steel companies also capitalize on this high demand."
The altered forecast is the outcome of a recent CAPEX update for the Nabucco consortium, based on an actual market survey among major material and service supplies. Such investment increases are in line with all major infrastructure projects that require a high amount of raw materials, since all are facing the same pricing challenges. However, the competitiveness and the economics of the project will be unaffected. High demand for energy leads to higher gas prices and, therefore, also higher transportation fees which make Nabucco considerably profitable.
So far, the market has shown interest in the project, and Nabucco Gaspipeline International GmbH has already signed various letters of interest with potential shippers. An intergovernmental agreement is expected to be signed in Turkey in July.
The pipeline, a third of which will be financed by the owners, and two-thirds by banks, is meant to diversify and lessen Europe’s dependence on Russian gas beginning in 2013.
The project requires two million tonnes of steel, 200,000 pipes and more than 30 compressor units.
The pipeline consortium, Nabucco Gas Pipeline International Ltd., is equally owned (16.67 percent each) by Austria’s OMV, Hungary’s MOL, Turkey’s Botas, Bulgaria’s Bulgargaz and Romania’s Transgaz and Germany’s RWE.
Named after the Babylonian king in the eponymous opera by Italian composer Giuseppe Verdi, the pipeline will take 31 billion cubic meters of gas each year from the Middle East and Caspian region to Europe beginning in 2012 at the earliest. It is likely to deliver the first gas to Europe in 2013.
SOURCE: APA
Kazakhstan Ratifies Oil Transit Treaty with Azerbaijan
Kazakhstan has ratified a treaty with Azerbaijan allowing Kazakh crude to be pumped through the Baku-Tbilisi-Ceyhan (BTC) pipeline, which links Azerbaijan's Caspian coast to Turkey's Mediterranean coast, the Kazakh presidential administration said.
The treaty provides for the creation of a new system to carry Kazakh oil across the Caspian Sea to Azerbaijan through the BTC pipeline.
The 1,700-kilometer (1,000-mile) pipeline, expected to start operating at full export capacity of 1.6 million barrels per day in 2013, pumps crude from Azerbaijan's oil fields off the Caspian coast via Georgia to Turkey, and on to Western markets.
May 28th was the second anniversary of when the pipeline's first oil reached Turkey's Mediterranean port of Ceyhan. The BTC is now transporting 1 million barrels per day.
Under the project, a 730-kilometer (453-mile) section is to be built on Kazakh territory from Eskene to Kuryk and from Kuryk to Baku (Azerbaijan's capital) across the Caspian Sea, with a link to the BTC system.
Russia has claimed the pipeline is aimed at weakening Moscow's influence in the region, regarding it as an 'anti-Russian' project.
(well the EVIL EMPIRE is not dead!)
The pipeline's shareholders are BP (30.1%), Azerbaijan BTC (25%), Chevron (8.9%), Statoil (8.71%), TPAO (6.53%), ENI (5%), Total (5%), Itochu (3.4%), INPEX (2.5%), ConocoPhillips (2.5%) and Hess (2.36%).
SOURCE: Today.az |
