E.ON Ruhrgas AG, the natural gas arm of E.ON AG (EONGY) doesn't expect the rising costs of the Nord Stream gas pipeline to pose a threat to the project, which will connect Russia with western Europe.
Costs are on the rise everywhere and other natural gas transport costs aren't cheaper than pipelines, E.ON Ruhrgas Chief Executive Burkhard Bergmann said Wednesday at the Handelsblatt energy conference in Berlin.
The Nord Stream consortium, a joint venture between Russian monopoly OAO Gazprom (GAZP.RS), German utility E.ON AG, BASF AG (BAS.XE) and Nederlandse Gasunie NV, raised the estimated projects costs to EUR8 billion from EUR5 billion in December, partly due to efforts to meet concerns from environmental groups that oppose the subsea pipeline.
Bergmann also Wednesday called for more political backing at European Union level for the Nord Stream pipeline. The project is a European undertaking that will help to secure the continent's security of supply in the long-term, he said.
The first stream of the 1,200-kilometer Nord Stream pipeline is planned to transport gas with a capacity of 27.5 billion cubic meters from 2011. This will be doubled to 55 bcm with a second stream from 2012.