RON 278 million (€60 million) loan to Transgaz for BRUA gas corridor
In a boost to the development of regional European energy markets, the EBRD is providing a RON 278 million (€60 million) loan for the construction of a new gas pipeline between Romania, Bulgaria, Hungary and Austria.
With a total length of 1,318 km, the so-called BRUA gas corridor will offer better interconnection between the countries along its route. It will boost the energy market by enabling new links with major gas infrastructure projects such as the Southern Gas Corridor, through TAP and TANAP, other central European gas hubs and future offshore production sites in the Black Sea.
The project will also ensure a greater integration of European gas markets and increase the security of supply.
Promoting the diversification of the routes and sources of supply, the pipeline will also support the development of local economies and competition on regional energy markets to the benefit of consumers.
The EBRD funds will be extended to Romania’s Transgaz which is building the Romanian section of the pipeline.
The total project cost is €479 million. In addition to the EBRD financing, Transgaz is investing €149 million, the European Union is providing €179 million in grants and the European Investment Bank is contributing a €50 million loan. The balance will be covered by other lenders.
The first phase of the project includes the construction of a 478 km pipeline between the technology node Podișor near Bucharest and the one in Recaș some 30 km away from Timisoara in the west of the country, as well as auxiliaries, state-of-the-art hardware and software supervisory systems and communication technologies and three gas compressor stations to be placed along the route.
Ion Sterian, Director General of Transgaz said: “This is a truly special event, for our company and for the EBRD, as well. We are proud to have partnered with the EBRD in better securing the financing of the Romanian section of the BRUA project. As one of the currently largest infrastructure projects backed by the European Commission, BRUA is going to bring much-needed connectivity between Bulgaria, Romania, Hungary and Austria. Transgaz attaches high value to the EBRD’s powerful drive to create significant opportunities for the natural gas transmission system operators along the BRUA route that will help bridge the gap between the east-west and the north-south gas corridors.”
Matteo Patrone, EBRD Regional Director for Romania and Bulgaria, added: “We are proud to partner with Transgaz in this crucial endeavour. This project is perfectly in line with our strategic objectives in Romania. While the cooperation with Transgaz has set the bar very high, we trust further opportunities to support the development of strategic infrastructure in the country will materialise both in the energy and transport sectors.”
Eric Rasmussen, EBRD Director for Natural Resources, commented: “We are pleased to support the BRUA pipeline, which will allow more integration of the gas markets in south-eastern Europe and increase price transparency. Transgaz deserves praise for planning the pipeline based on the best environmental and social practices.”
The EBRD is a leading institutional investor in Romania. It supported 29 projects with €546 million of debt and equity investments last year. Of this financing, 93 per cent was provided to the country’s private sector.