Project Focus: Nabucco Pipeline

The 3300 km long Nabucco is supposed to connect the European Union better to the natural gas sources in the Caspian Sea and the Middle East regions. The cost estimates for this project is around �7.9 billion.

Nabucco Gas Pipeline Project

	Location	From Turkey to Austria - TR
	Investment	10,000,000,000 USD
	Announced	2/28/2002
	Completion	6/15/2015
	Recent Update 6/8/2010	Turkey and Azerbaijan have signed an agreement in Ankara defining terms for the transit of gas to Turkey and Europe.
	Scope	Nabucco pipeline (Turkey - Austria gas pipeline) is a proposed natural gas pipeline from Erzurum in Turkey to Baumgarten an der March in Austria diversifying natural gas suppliers and delivery routes for Europe. The pipeline attempts to lessen European dependence on Russian energy. The project is backed by several European Union states and the United States and is seen as rival to the Gazprom-led South Stream pipeline project. At the same time, there are some doubts concerning viability of supplies. The main supplier is expected to be Azerbaijan in cooperation with Turkmenistan, Iraq and Egypt. The Nabucco pipeline will be built in two stages. The first stage of construction will consist of the 2,071 km stretch from Ankara in Turkey to Baumgarten in Austria, as well as the 360 km extension from Ankara to Sivas. The second stage will serve to link the upstream feeder lines from Turkey�s borders to the main pipeline, which will equate to an additional 1,600 km. It is anticipated that the lifespan of the pipeline will be 50 years. The pipeline will run from Turkey via - Bulgaria, Romania and Hungary ending up in Austria close to the Gas Hub in Baumgarten. The feeder line concept in Turkey currently foresees a connection to the Turkish/Georgian border and to the Turkish/Iraqi border. Near Erzurum, it will be connected with the Tabriz - Erzurum pipeline and with the South Caucasus Pipeline, connecting Nabucco Pipeline with the planned Trans-Caspian Gas Pipeline. About 2,730 km kilometres of the pipeline will be laid in Turkey, 412 kilometres in Bulgaria, 469 kilometres in Romania, 384 kilometres in Hungary, and 47 kilometres in Austria. The technical details of the pipeline:- Total length: 3,300 km to 4,000km Diameter: 1,422mm / 56� Diameter Material: Steel Capacity: 31bcm/ year Wall thickness: 20-36 mm Burial Depth: Minimum 1,0m Pressure: 100 bar Control: One Main Control Center and one Sub-Control Center In-Country Control Centres (ICCC): Ankara, Turkey; Sofia, Bulgaria; Medias, Romania; Budapest, Hungary; Baumgarten, Austria Compressor stations: 11 The pipeline, valves and fittings will be treated for internal and external corrosion with protective coatings as well as an impressed cathodic protection system. The pipeline system includes all of the above ground installations associated with the Project. These will comprise main, local and sub control centres, compressor stations, custody transfer bordering metering stations, intermediate take-offs, cathodic protection stations, pigging and block valve stations, SCADA and a fibre optic telecommunication system. The Nabucco Pipeline construction is scheduled to start at the end of 2011 and the first gas will flow end of 2014. The main section of the pipeline completed by 2015. In early years after completion the deliveries are expected to be between 4.5 and 13 billion cubic meters (bcm) per year or 158 to 459 billion cubic feet (Bcf). Around 2020, the supply volume is expected to reach 31 bcm (1.1 trillion cubic feet) per year, of which up to 16 bcm (565 Bcf) will go to Baumgarten. The Nabucco project is being financed through a combination of investment from shareholders and debt financing from European financial institutions, mainly development banks. Total investment is estimated at EUR 7.9 billion, 70% of which will be financed through loans from financial institutions and 30% by the project's partners.

Development Milestones

	2/28/2002	Initial discussions took place for the Nabucco project between OMV Gas & Power GmbH (Austria) and BOTAS (Turkey).
	6/30/2002	Five companies (OMV of Austria, MOL Group of Hungary, Bulgargaz of Bulgaria, Transgaz of Romania and BOTAS of Turkey) signed a protocol of intention to construct the Nabucco pipeline.
	6/28/2005	The joint venture agreement (JVA) was signed by the five Nabucco partners. The agreement laid out the rules of the Nabucco pipeline project.
	1/8/2008	The British company Penspen has been appointed as owner's engineer, in a European wide tender procedure, for coordinating the detailed planning of the project.
	2/28/2008	The German RWE joined the Nabucco Project as the sixth shareholder.
	6/11/2008	The first contract to supply gas from Azerbaijan through the Nabucco pipeline to Bulgaria was signed. Azerbaijan confirmed that it was planning to at least double its gas production in the coming five years to supply the pipeline.
	5/12/2009	Detailed engineering and planning for the complete route of the multinational Nabucco Pipeline Route has reached the intensive phase. Five Local FEED (Front End Engineering and Design) Engineers for Austria, Hungary, Romania, Bulgaria and Turkey have been appointed and the British owned engineering consultant company Penspen now coordinates the planning efforts. These local firms are currently evaluating and investigating all technical details of the entire pipeline route to realise the necessary detailed planning.
	7/13/2009	The Intergovernmental Agreement (IGA) was signed in form of a Treaty between the Nabucco transit countries - Austria, Hungary, Romania, Bulgaria and Turkey - in Ankara. Under the IGA, the five countries guarantee to facilitate the construction and operation of the Nabucco pipeline within their territories over a total length of around 3,300 kilometres, all regulated under a single legal regime.
	3/5/2010	Turkey has completed the ratification process as the fifth transit country of the Nabucco consortium that have endorsed the agreement, following Hungary (October 2009), Austria (December 2009), Bulgaria and Romania (February 2010).
	4/23/2010	Nabucco Gas Pipeline International launched the pre-qualification process as a starting phase for the procurement of long lead items such as pipes and valves needed for the pipeline construction. The value of the entire package is around Euro 3.5 Billion ($4.7 billion) and the deadline for companies to participate in the prequalification was 17th May. Nabucco requires 250,000 pipes and over 2 million tons of steel, along with several pieces of specialist equipment and more than 30 compressor units.
	6/8/2010	Turkey and Azerbaijan have signed an agreement in Ankara defining terms for the transit of gas to Turkey and Europe.