Romania and its neighbor the Republic of Moldova recently started work on the gas pipeline connecting the Romanian city of Iasi to the Moldavian Ungheni. The inauguration of work on the pipeline took place on Tuesday, August 27, when the Republic of Moldova celebrates its Independence Day. The ceremony was attended by Prime Ministers of both countries, as well as by Günther Oettinger, the European Commissioner for Energy.

The gas pipeline is meant to diversify Republic of Moldova's gas sources, which currently solely relies on Russian Gazprom. Once the pipeline is done, in the end of 2013, Romania will sell the Republic of Moldova gas at market prices, according to Romanian Energy Minister Constantin Nita. The average gas price is of USD 400-450 per 1,000 cubic meters, according to Nita.

The gas pipeline will cost some EUR 20 million to build, with a second EUR 10 – 20 million stage scheduled for creating a gas compression station. Romania will invest some EUR 12 million in the first stage of the project, to build the pipeline on its territory (in picture).

The 43.2-kilometer pipe, out of which 32.8 kilometers on Romania's territory will connect the two countries' gas networks, and comes soon after the planned Nabucco West pipeline project was halted. Romania was supposed to be part of this pipeline, as much of the 1,300 kilometers of the gas pipe would have crossed Romanian territory – some 475 kilometers.

OMV announced earlier in June that the gas pipeline project Nabucco West was not selected by the Shah Deniz II consortium as their preferred gas transportation route to Europe. This means that gas from the Caspian bedding Shah Deniz II will not travel to Europe via the Nabucco pipe, the  pipe which was supposed to connect Bulgaria to Austria via Romania.

When this announcement was made, Romanian officials said the country will focus on the AGRI project, the Interconnector Azerbaijan-Georgia-Romania-Hungary, a proposed project to transport Azerbaijani natural gas to Romania and further to Central Europe.

editor@romania-insider.com

(photo source: gov.ro)