RWE may ditch Nabucco gas pipeline project

RWE may ditch Nabucco gas pipeline project 18 Jan 2012 German utility RWE may scrap plans to participate in the Nabucco gas pipeline to save costs, opening the way for a merger of projects competing to bring Azeri gas via Turkey to Europe, its chief executive told the Wall Street Journal. Juergen Grossmann told Wednesday's edition of the newspaper that, while the company remained keen to import Caspian gas to Europe, it now favoured options 'that keep our own financial exposure limited,' and that RWE could instead support other pipelines that compete with Nabucco. On Tuesday, RWE said that it would in future focus on its core European markets. RWE has so far been a stakeholder in the 4,000 km, 32 billion cubic metre (bcm) capacity Nabucco pipeline project, but sources have told Reuters the company was looking for cheaper ways to secure its future gas needs. Critics say that Nabucco's costs of over $12 billion have risen too high and that there is not enough gas available to fill such a big pipeline with non-Russian supplies. Three international consortia (Nabucco, TAP, and ITGI) are competing to build the infrastructure to carry around 10 bcm of gas a year from Azerbaijan's Shah Deniz II gas field to Europe. TAP, whose main partners are Norway's Statoil, Germany's E.ON Ruhrgas, and Switzerland's EGL , has said that it would welcome new partners or a consolidation of projects. Original article link Source: Reuters