Nabucco urgently needs 300 million Euros in funding

• Yesterday, in Budapest, Romania confirmed its commitment to the project

Yesterday"s conference held in Budapest on the subject of the Nabucco project focused on funding and on securing the gas supply. In the beginning of the conference, Hungarian Prime Minister Ferenc Gyurcsany said that the European Union (EU) needs to pledge its support to the Nabucco project by securing some 300 million Euros in funding in the coming months. Mr. Gyurcsany said, as quoted by Reuters: "Having or not having energy is a matter of national security and of stability in the region. Perhaps it is time that the European Union took on certain financial risks, that the companies involved in the project can not afford to take on".

Ferenc Gyurcsany added that Nabucco could cost up to 10 billion Euros, and as such loans from the EBRD and EIB will be needed. Until now, commercial banks were reluctant in funding the project without firm gas supply agreements. The intergovernmental agreements can be done by June 2009", the Hungarian Prime Minister said.

The European Energy Commissioner, Andris Piebalgs, stated yesterday, during the conference, that the EU should not ensure funding from its own sources for Nabucco, but it could offer loans and guarantees for loans. Mr. Piebalgs explained that if the EU were to grant funding directly, then Nabucco would become a public-private partnership instead of an fully private consortium.

Nabucco has 3300 km in length and will supply Europe with gas from the Caspian Sea area across Turkey, Bulgaria, Romania, Hungary and Austria. The Nabucco summit had attendees from the ten states involved. The Romanian delegation is led by the Minister of Economy, Adriean Videanu, and includes officials of "Transgaz", the national gas producer. During yesterday"s conference, minister Videanu again confirmed Romania"s commitment in the accomplishment of the Nabucco project. According to Agerpres, Mr. Videanu stated that Romania has a geo-strategic location that is important for the Nabucco project and has outlined the fact that European countries must focus on intergovernmental agreements when it comes to the materialization of the project. "We have entered heads-of-agreement on a government level with Turkey, Bulgaria, Hungary, Austria, which will come to fruition during the subsequent meetings", Adriean Videanu added. At the same time, the Romanian Minister of the Economy also emphasized the importance of the Egyptian and Iraqi sources which are to supply the Nabucco pipelines.

According to Reuters, Azerbaijan, key supplier for Nabucco, yesterday confirmed that it would remain committed to the Nabucco project and has urged the parties taking part in the conference to rush the implementation of the project. "We have supported the project in the past and we continue to support it", said Azeri president Ilham Aliyev, who also attended the conference.

Czech Prime Minister Mirek Topolanek, whose country also holds the European Union"s rotating presidency, stated yesterday that it is time for Europe to rush the project, which is not intended to compete with the pipelines planned by Russia - North Stream and South Stream. "We are not using Nabucco against Russia, we need it to cover Europe"s consumption. But South Stream and North Stream pose a threat for Nabucco. These pipelines increase Europe"s dependence on Russian gas", Topolanek said.

Representatives of the Hungarian government announced also announced yesterday, that PGNiG, the Polish gas transport company plans to join the Nabucco consortium, but they did not specify any details on the nature of this involvement. Donald Tusk, Polish Prime Minister has assured Hungary that Poland supports Nabucco and the Polish national gas producer would like to join the project.

The Nabucco project was initiated by five companies operating in the gas sector, OMV (Austria), MOL (Hungary), Botas (Turkey), Bulgargaz (Bulgaria), Transgaz (Romania) and RWE (Germany). The annual volume of gas transported will be 31 billion cubic meters.