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June 2nd, 2007
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RWE plans new pipeline

'Gazela' to import Russian gas from line beneath Baltic Sea

By Markéta Hulpachová
Staff Writer, The Prague Post
May 23rd, 2007

The Czech branch of German energy company RWE is considering the construction of a high-capacity natural gas pipeline that will connect the Czech Republic to the Baltic Sea. By installing this line, RWE would prepare for the projected 2012 completion of NordStream, a North European energy project linking Russia and Germany through a pipeline under the Baltic Sea.
The pipeline, called Project Gazela, would connect the north Bohemian town of Hora Svaté Kateřiny to Waidhaus, a German town near the Czech border. If NordStream is realized, Gazela would then connect to the OPAL branch of the pipeline, west of the border.
“The decision is tied to the existence of larger connecting pipelines, namely OPAL and NordStream,” said Jitka Kadavá, spokeswoman for RWE’s Czech branch.
RWE is currently discussing three possible route options for the construction of Gazela. Each route would connect Waidhaus to the north Bohemian part of an existing gas main, which traverses the country from Hora Svaté Kateřiny to south Moravia.
RWE’s final decision is expected at the end of 2008, and the company estimates the project would cost around 15 billion Kč ($72.2 million), Kadavá said. If approved, construction will start in 2009, the same year that NordStream expects to start transporting gas from Vyborg, Russia, to Greifswald, Germany.
By providing a direct gas route from Russia to Northern Europe, NordStream hopes to provide European countries with a more reliable energy source.
“Right now there is a significant gap in European gas supply,” said NordStream spokeswoman Irina Vasilyeva.
By the completion of its second phase in 2015, NordStream hopes to increase the European supply by 25 percent. According to Vasilyeva, building onshore links to existing Russian pipelines will not provide the same level of supply security.
“Because we are talking of such a large-scale project, there has to be a new pipeline,” she said.
In November 2005, Russian energy giant Gazprom began constructing the first piece of the NordStream puzzle, a 917-mile onshore pipeline connecting Russia to Vyborg, a Gulf of Finland port near St. Petersburg.
The ownership of NordStream is split between three companies. Fifty-one percent is owned by Gazprom, with the remainder evenly divided between E.ON and BASF.
Since 2000, the NordStream pipeline has faced opposition from environmentalists. The company is currently conducting environmental assessment and negotiating permits from North European countries.
“We expect construction to start in 2008, but we are dependent on these permits,” Vasilyeva said. If approved, the line will run through the waters of Russia, Finland, Sweden, Denmark and Germany.

Markéta Hulpachová can be reached at business@praguepost.com


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