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07.03.2011 16:34

Nord Stream Financing Completely Secured

The 2.5 billion euros pipeline project confirms financial backing from 24 banks

AUTHOR: publics.bg

© Nord Stream

Today, Nord Stream AG together with its shareholders in the consortium, Gazprom, E.ON Ruhrgas, BASF/Wintershall Holding, N.V. Nederlandse Gasunie, and GDF SUEZ. announced the successful signing of Phase II financing of the Nord Stream pipeline project.

According to Matthias Warnig, Managing Director of Nord Stream AG Line 1 of Nord Stream nearly complete and with construction of Line 2 due to start in May, it is clear that lenders see Nord Stream as a solid project with a sound economic background. “Nord Stream is on track to deliver gas to Europe from later this year”, he added.

Twenty-four banks are participating in a deal that was oversubscribed by 60 percent and that mirrors the solid and successful financial structure of Phase I financing that took place in early 2010. The high interest in Nord Stream’s Phase II financing attests to the continued strategic importance of the pipeline project. Line 1 is due for construction completion in April 2011, the start of pipe laying for Line 2 will commence thereafter with completion due in April 2012.

The very positive response from lenders has meant that Nord Stream was heavily oversubscribed for the 2.5 billion euro funding. Nord Stream has RBS, Commerzbank and Société Générale acting as financial advisers. Unicredit have a limited advisory role in connection to the untied loan programme of the German government. White & Case are acting as legal advisers to Nord Stream while Clifford Chance acts for the lenders.

Alexei Miller, Management Committee Chairman of Gazprom, said: "Nord Stream is an example of success on a pan-European scale. Over the years of planning it has won the reputation of being ecologically safe and transparent, and it is the most advanced of all the new projects aimed at transporting gas to Europe.".

According to Dr. Rainer Seele, Chairman of BASF/Wintershall gas production in Europe is declining steadily, which means that more gas has to be imported in the future and that Nord Stream will supply Europe for decades with secure and climate-friendly energy. The 55 billion cubic meters of natural gas that will flow through the Nord Stream Pipeline to Europe equal the capacity of 55 coal-fired power plants or 20 new nuclear power plants.