Russia is investigating the possibility of extending a new pipleine currently being constructed by Gazprom, President Putin has said. The natural gas pipeline that will deliver the fossil fuel liquid from the company's South Russian gas field direct to western European markets by 2007.
Construction of the North-European natural gas pipeline (NEG) has recently been initiated by gas major Gazprom. The company plans to complete the first 100km through the Boksitogorsky area in the Leningrad region within six months.
However Russian president Vladimir Putin has now told German state broadcasting that a branch of the pipeline may be constructed to serve northern Germany. Under the current plans the pipleline will emerge in Mecklenburg-Western Pomerania, Germany.
Ultimately, the NEG project will involve the construction of 568 km of pipeline on and under land, and 1089 km under the Baltic Sea. The pipeline is scheduled to begin transporting gas in 2007, and is expected to achieve a capacity of 55 billion cubic meters per year by 2009. The beneficiaries of the new gas source will include the UK, Germany and Scandinavian countries.
However, while a positive development for western Europe, the project has been mired in controversy in the east because it bypasses the Baltic states of Poland, Lithuania and Estonia. The trio of nations want the pipeline to run across their land.
Meanwhile, uncertainty remains over claims that Gazprom has successfully purchased 3% of takeover target Sibneft’s shares on the open market. According to the Moscow Times and Mosnews, the gas major has bought the shares in a move to discourage potential rival suitor Rosneft. However, other reports have thrown scorn on the contention, pointing to the lack of activity in Sibneft’s share price. Gazprom has not commented on the speculation.
A 3% gain would be of significance however, as it would prevent Rosneft from gaining enough shares to yield a veto over Sibneft management decisions.