Finland Clears Start of Balticconnector Gas Pipeline

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--The Finnish government has said construction can now start on the Balticconnector offshore gas pipeline that will connect Finland to Estonia.

The pipeline is seen as vital for Finland's future energy security and by being able to connect to the gas networks in the Baltic region, it will end the country's complete reliance on Russian gas imports. The pipeline agreement was first signed last October. For additional information, see October 26, 2016, article - Finland and Estonia Sign Historic Gas Pipeline Deal.

The Balticconnector will enable the transport of 7.2 million cubic meters of gas per day in both directions and is expected to cost 187 million euro ($204 million) to construct. Most of the funding for the project has been guaranteed by the European Union (EU) and it is expected to be completed by 2020. The pipeline will consist of three sections: 22 kilometres (km) on Finnish soil, 80 km offshore and 50 km in Estonia. The pipeline also forms a key part of a wider European Union (EU) drive to reduce the region's reliance on Russian gas. Part of its Energy Union strategy is committed to building missing energy infrastructure links that will ensure that every member state has access to at least three different sources of gas.

The public procurement process for the manufacturing and installation of the gas pipeline is underway, according to Baltic Connector. Tenders for the manufacture of the offshore pipeline are being sought from four companies and for its installation from five companies. The tenders must be in by the start of September.

"Our procurement and project organisation has done a great job, and both the public procurement and the entire project are progressing on schedule," said Herkko Plit, president and chief executive officer of Baltic Connector. "The construction work for the pipeline will start in spring 2018, and the completed pipeline will open the Finnish gas market to Europe in 2020."

He added: "It is good that the Parliament has made a decision that helps the opening of the market. Building a new gas infrastructure that supports open markets must be started immediately so that it can be utilised cost-efficiently at the beginning of 2020."

Gas security is a priority in Europe, which relies on Russia for more than a third of the region's total. Gas supplies have been interrupted in the past over political and military clashes between Russia and its neighbours, including Ukraine, the main transit route for Russian gas entering Europe.

Russia is forging ahead with the new Nord Stream 2 pipeline to Europe, which will feature 1,220-kilometre (km) twin pipelines that will have a total capacity of 55 billion cubic meters of gas, effectively doubling the capacity of the existing Nord Stream strings, which were commissioned in 2011 and 2012. The gas will travel from Russian gas reserves to European consumers from the Russian coast via the Baltic Sea to Greifswald in Germany. Nord Stream 2 will largely follow the route and design of the successful Nord Stream pipeline.

In May, Industrial Info reported that five European energy companies pledged to invest up to 5 billion euro ($5.4 billion) in the Nord Stream 2 pipeline project--approximately half the total cost. For additional information, see May 1, 2017, article - Contracts Signed for Nord Stream 2 Pipeline.

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