Nabucco Begins Dialogue With Lenders, Says Mitschek

The Nabucco Gas Pipeline consortium has begun negotiations with potential lenders, the group’s managing director Reinhard Mitschek said in the November issue of the project’s newsletter, released on 5 November. “Nabucco has started detailed discussions with the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD) and will soon also enter into a dialogue with the International Finance Corporation (IFC),” Mr Mitschek said, adding that the talks are aimed at determining the key financing parameters and other important project decisions. The 31 bcm/year capacity, 3,300 km gas pipeline is estimated to cost €8bn. A final investment decision is expected in 2010 and construction should begin in 2011.

“The most important objective of these current talks is to keep lenders informed about the environmental and social impact assessment of the project and to ensure that these works are performed in line with lender’s requirements,” Mr Mitschek said. “A project the size of Nabucco will need a diversified set of lenders.” He said that meetings with export credit agencies like Coface, Hermes, SACE, USExim and JBIC have already taken place, and added that for the sake of risk mitigation, Nabucco would rely on funding from the EU for financing the development phase.

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