EBRD to partly finance Ungheni-Chisinau gas pipeline in Moldova

EBRD to partly finance Ungheni-Chisinau gas pipeline in Moldova
By bne IntelliNews April 8, 2016

The European Bank for Reconstruction and Development (EBRD) is ready to finance €75mn of the cost of the Ungheni-Chisinau natural gas pipeline in a 50/50 partnership with the European Investment Bank, EBRD resident representative Julia Otto told a press conference on April 7, noi.md reported. The project costs €85mn, of which €10mn is being provided by the EU as a grant.

The pipeline will link Moldova’s economically active regions to the European gas transportation network, capitalising on the Iasi-Ungheni natural gas interconnector that was commissioned last year but is used at very low capacity because of insufficient national gas transport infrastructure.

Construction of the 130km Ungheni-Chisinau natural gas pipeline will start in 2016 and will be completed in May 2018, Vice-Minister of Economy Valeriu Triboi told a press conference on October 9, quoted by noi.md.

The pipeline will transport 1.5-2bn cubic metres (cm) of gas per year from the border with Romania to Chisinau, where most of Moldova’s consumption is concentrated. This will nearly totally eliminate Moldova’s dependence on Russian gas.

The EBRD extended €100mn of financing to Moldova in 2015, despite the politic, economic and financial challenges faced by the country, Otto said. The bank is not planning to reduce financing and is ready to undertake new projects.

The EBRD is also ready to finance the connection of Moldova’s electricity grid to the European grid through Romania. Romania’s power exports to Moldova are limited by the existing transport capacity between the two countries. This is also valid for the natural gas market, where Romania could supply its excess production to Moldova.

Moldova consumes some 1.2bn cm of gas per year, while the pro-Russian separatist republic of Transnistria - where large part of Moldova’s industry is concentrated - needs another 1bn cm of gas per year. Currently, almost all Moldova’s natural gas is imported from Russia.


Related Articles

Turkey and Israel aim to ink natural gas pipeline deal by end-2017

Turkey’s Energy Minister Berat Albayrak, son-in-law of President Recep Tayyip Erdogan, is set to visit Israel by the end of this year to conclude an agreement to construct a natural gas pipeline ... more

Polish utility Tauron places €500mn eurobond issue

State-controlled Polish power firm Tauron has sold €500mn worth of eurobonds, the company said on July 5. Tauron needs capital to refinance the costs of construction and the purchasing of a ... more

Hungary signs deal to link to Russia's Turkish Stream gas pipeline

Budapest has signed a deal with Russia's Gazprom to link Hungary with the under-construction Turkish Stream ... more