Nabucco issues May prequalification deadline for gas pipeline

27 April 2010

Tender for cross-regional pipeline supplies estimated at $4.7bn

Vienna-based Nabucco Gas Pipeline International has set a 17 May deadline for the submission of prequalification documents for the supply of long lead time items such as pipes and valves, required for the construction of its planned Turkey to Austria natural gas pipeline.

The overall value of the prequalification package is estimated at $4.7bn.

“The prequalification for long lead items is a substantial step towards starting construction at the end of 2011,” said Reinhard Mitschek, Nabucco’s managing director in a 23 April statement.

According to the company, capital investments for the project will total $1.5bn, based on the project assessments during summer 2008.

“Long lead items – like pipes and valves – are the cornerstone for pipeline construction, and account for a considerable part of the overall investment costs. The prequalification process will identify the most eligible companies and is the basis for a successful procurement process,” said Mitschek.

Construction will start in 2011 and the first gas will flow by 2014. When complete, the 31 billion cubic metre Nabucco gas pipeline will run more than 3,300 kilometres from Turkey to Vienna.

Iraq’s semi-autonomous Kurdistan Regional Government (KRG) has expressed an interest in supplying gas to the pipeline. Iraq’s oil ministry, however, has consistently criticised the proposed $8bn deal, saying it contravenes Baghdad’s existing export rules (MEED 18:5:09).

Iran has also long held ambitions to supply more than half of the gas to the proposed pipeline.

The pipeline’s shareholders include OMV Gas & Power, MOL, both of Hungary; Romania’s Transgas; Bulgarian Energy Holding, Turkey’s Botas and Germany’s RWE.

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