Romania’s state-controlled natural gas transport operator Transgaz announced on February 27 that it has taken over the 100% stake put up for sale by Moldova in Vestmoldtransgaz.
Vestmoldtransgaz currently operates the gas interconnector with Romania, but is supposed to also build the key connection toward the industrialised area around the Moldovan capital Chisinau, thus ending the country's dependency on Russian gas.
Transgaz was the sole bidder in the auction for Vestmoldtransgaz. The Romanian company paid €8.8mn, and according to the privatisation contract it must invest €93mn in the 100km pipeline with a capacity of 1.5bn cubic metres (cm) per year linking the western part of the country with capital city Chisinau, Ziarul Financiar daily reported quoting unofficial sources.
The Vestmoldtransgaz deal prepares for the supply of Romanian natural gas to Moldova, which so far relies 100% on Russian gas under a relationship that complicates the situation in the separatist republic of Transnistria.
Moldova’s authorities want to have the pipeline facilitating the use of Romanian gas built as soon as possible, ideally before the end of 2018 — an unrealistic deadline imposed by the renewal of the contract with Gazprom. More realistically, Moldova will receive Romanian gas after 2020-2021, when the offshore gas from Black Sea will start flowing. But even before this, Moldova's consumption — 1bn-1.2bn cubic metres (cm) per year — could be partly be supplied from Romania, which produces over 10bn cm and roughly meets its consumption.
Re-routing Russian gas from Romania (instead of involving Gazprom-controlled Moldtransgaz) will also help Moldova in its negotiations on gas imports from Russia and particularly on the arrears accumulated by Transnistria, which amount to roughly $5bn.
The financing for the 100km long pipeline has already been secured. The European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) will lend €41mn each and the European Union will add a €10mn grant to fund a pipeline to link the Romania-Moldova interconnector with the Chisinau region, the EBRD said in a December 19 statement.
This is the second entry of a major Romanian company on the Moldovan market recently, after Banca Transilvania took over the country’s third-largest bank Victoriabank earlier this year in partnership with the EBRD. Rompetrol has been active in Moldova for a long time and the DIY retailer Dedeman is also considering entry to the neighbouring market.