International Pipeline Construction Report

By Rita Tubb, Managing Editor | November 2010, Vol. 65 No. 11

The Azerbaijan-Georgia-Romania Interconnection (AGRI) project envisages construction of two LNG terminals, one in Georgia and one on the Romanian Black Sea coast. The terminals would allow gas from Azerbaijan to flow via pipeline across the Caucasus to Georgia and liquefied at a planned terminal at Kulevi (where Azerbaijan's state-run oil and gas firm SOCAR has an oil export terminal), then shipped across the Black Sea to the Romania. There, the LNG would be regasified, pumped into the Romanian gas grid, and delivered into the wider European market.

Preliminary estimates for the two LNG terminals are US$5.4–8.1 billion. The AGRI project could transport up to 7 Bcm/y of gas and be finalized in three years.
One of the region’s most notable projects is construction of the Nord Stream Pipeline to deliver natural gas to Europe. It consists of two parallel lines which will be laid across the Baltic Sea from Vyborg, Russia to Greifswald, Germany. The first, with a transmission capacity of 27.5 Bcm/a, is due for completion in 2011. A second parallel line is due for completion in 2012, doubling annual capacity to around 55 Bcm/a.
Total investment in Nord Stream is EUR 7.4 billion. Nord Stream AG is an international consortium whose partners are Gazprom, Germany’s E.ON and BASF/Wintershall and the Dutch company Gasunie.

Western Europe & European Union
While pipeline construction continues to lag in many EU nations, this is expected to change with a decision by the European Commission (EU) to provide US$1.9 billion in grants to ensure that some 30 gas projects are not delayed. Some of the projects to receive the commission grants include the 804-km Interconnector Turkey-Greece-Italy (ITGI) project, 210-km Posiedon Pipeline, 453-km Skanled Pipeline, 3,300-km Nabucco Pipeline and the 210-km Slovakia-Hungary Interconnector, plus upgrades to Slovenia’s transmission system.

One major project recently under way is the 470-km OPAL (Ostsee-Pipeline-Anbindungs-Leitung – Baltic Sea Pipeline Link) in Germany. The starting point is near Greifswald and its termination point is on the German-Czech border near Olbernhau. Once completed, it will connect Germany and Europe to the major natural gas reserves in Siberia via the Nord Stream pipeline. As many as 2,500 workers will work on the pipeline before commissioning in October 2011.

OPAL is owned by Wingas GmbH & Co. KG, 80% and E.ON Ruhrgas AG 20%. OPAL Nel Transport GmbH and E.ON Ruhrgas Nord Stream Anbindungsleitungsgesellschaft GmbH are the network operators.