Gazprom-led Nord Stream 2 has signed financial agreements with five major energy companies, including supermajor Shell, for the Nord Stream 2 pipeline project.
Nord Stream 2 pipeline signing. Image from Uniper Twitter.
In addition to Shell, financial deals were signed with France’s Engie, Austria’s OMV, and Germany’s Wintershall, and Uniper.
“These five European energy companies have committed to provide long-term financing for 50% of the total cost of the project, which is currently estimated to be US$10.3 billion (€9.5 billion),” Nord Stream 2 said. “Each European company will fund up to $1 million (€950 million).”
“Gazprom is and will remain the sole shareholder of the project company, Nord Stream 2 AG,” the company confirmed.
The 1220km Nord Stream 2 gas pipeline, with a total capacity of 55 Bcm a year, will provide a direct link between reliable Russian gas reserves and European gas consumers from the coast of Russia via the Baltic Sea to Greifswald, Germany. Construction work will begin in 2018 and will be completed by the end of 2019.
“The financial commitment by the European companies underscores the Nord Stream 2 project’s strategic importance for the European gas market, contributing to competitiveness as well as medium and long-term energy security especially against the background of expected declining European production,” Nord Stream 2 said.
Earlier this month, Nord Stream began the environmental impact assessment (EIA) procedure in Russia for the project by disclosing relevant project documents.
The company also finalized a contract with Allseas for the offshore pipelay of the pipeline though the Baltic Sea, with work for both lines to start in 2018 and 2019. Allseas will use three pipelay vessels for the project; the mega vessel Pioneering Spirit, Solitaire and Audacia.