Slovakian gas
pipeline operator Eustream expects to sign within weeks commercial agreements
with potential partners on the development of Eastring, a new bidirectional
pipeline that would carry gas from Western Europe to the Balkans, a senior
company official said.
In May, Bulgaria, Romania, Hungary and Slovakia
signed a declaration in support of plans to interlink their gas grids and
increase bi-directional capacity while joining their efforts to seek new sources
and routes for gas supply diversification.
“Despite the fact we perceive
the conclusion of this declaration in a very positive way, it has no concrete
implications for the further steps for the project’s implementation or its
timeline. This is an issue that should be solved on commercial basis,” Mirek
Topolanek, Eustream’s international development and public affairs director,
told SeeNews in an emailed interview.
“We expect to be able to conclude
such company-level declarations during the upcoming weeks in order to achieve
our main target, which is to allow this project to be fully operational by the
end of 2019.”
Eastring, conceived as an alternative to the now defunct
South Stream, should secure natural gas supply to fully meet the consumption
needs of all Balkan countries.
“After the cancellation of the South
Stream gas pipeline project, Eastring is a very important element in the process
of diversifying natural gas sources and transmission routes, namely for the
countries of the Balkan region which can be connected to Western gas hubs,”
Topolanek said.
Eastring, with ultimate capacity seen at 40 billion cu m
per year, could provide Western gas shippers with a possibility to supply Balkan
countries and even Turkey from European hubs such as NetConnect Germany,
Gaspool, Baumgarten, and the Dutch-based Title Transfer Facility, official
project data indicated.
Another very important aspect of the Eastring
project is its ability to connect countries in Central and Eastern Europe to the
gas from liquefied natural gas terminals in Greece and Turkey, which would be
made possible through interconnectors that Bulgaria plans with both
countries.
“The planned link between Bulgaria and Turkey allows also
considering the Eastring pipeline from another perspective – as a project able
to connect Europe to alternative gas sources from the Caspian region,
Azerbaijan, Turkmenistan and Iran, and last but not least also to gas of Russian
origin, delivered through the planned Turk Stream pipeline. From the perspective
of all mentioned aspects, the Eastring project fits perfectly into the strategy
for the development of Bulgaria’s gas infrastructure,” Topolanek said.
In
December, Russia's Gazprom and Turkey’s Botas signed a memorandum of
understanding for the construction of an offshore gas pipeline that will have a
capacity of 63 billion cu m.
The move followed the announcement that
Russia was abandoning plans to build the South Stream, a gas pipeline project
that would have opened up a supply route to Southeast Europe that bypasses
Ukraine and is less at risk of disruption.
Eastring will start at an
existing compressor station in Velke Kapusany in Slovakia, where it should
connect with Eustream’s existing gas transit assets serving to supply mainly
Western Europe as well as Ukraine in reverse flow, official project data
indicated. From there, Eastring will aim to the south border with Hungary,
crossing the north-east territory of Hungary in a U-shape towards the Romanian
borders.
In this initial phase there are two routing options suggested in
Romania and Bulgaria.
The first route option passes through storage and
production facilities in Transylvania and continues to the existing
interconnection point Isaccea where it connects to the existing transit
infrastructure which runs through the Romanian-Bulgarian border at Negru Voda
and then onwards from north-east to south-east along the existing Bulgarian gas
transit assets to tie into the Turkish gas transit network at
Malkoclar.
The second route option passes through both storage areas and
production facilities, Bucharest and continues to the Romanian-Bulgarian border
and then onwards straight to the Turkish border at Malkoclar.
According
the first simulations, Eastring will be approximately 832–1,015 km in length,
depending on the chosen route. However, the pipeline routing is still not final
and it will be further refined in all countries.
Topolanek said
discussions with Eustream’s potential partners on the Eastring project, mainly
from Hungary, Romania and Bulgaria, continue and have so far resulted into the
successful submission of the project to the reopened Ten Year Network
Development Plan of the European Network of Transmission System Operators for
Gas and to the pool of candidates for the list of the EU’s Projects of Common
Interest (PCI), which would make it eligible for financial support from the
bloc’s Connecting Europe Facility (CEF) fund.
After successful submission
of the project to the PCI list, Eastring’s backers will be able to proceed with
further steps, covering also conducting a market test.
“On the technical
level, we are, inter alia, working on the precise project routing, which will
enable calculation of the detailed project specifications, including the costs
for its implementation and operation,” the official said.
Eustream
continues to hold meetings with big gas companies from Western Europe on
possible involvement in Eastring but at this point of time, Topolanek said it
would be premature to disclose concrete names.
Asked when an official
selection of partners could be made, Topolanek said this decision depends on
many factors, including but not limited to an agreement with Eustream’s current
partners on the future project structure as well as project financing
issues.
“In order to have more visibility on a project funding structure,
we have entered into discussions with all relevant institutions, including the
European Investment Bank. However, agreement on the financing structure of the
project could be achieved only after the EC reaches a decision on a possible CEF
grant,” Topolanek said.