Nord Stream 2 AG is continuing negotiations with export credit agencies (ECA) to provide guarantees for the construction of the Nord Stream 2 pipeline; the actions of Naftogaz of Ukraine are not hindering negotiations which should be completed in around six months, the company’s CFO Paul Corcoran told journalists on the sidelines of the World Gas Conference.
He said that Nord Stream 2 AG shares have not been frozen upon the requests of Naftogaz.
He said that this had not occurred and that it is an ongoing legal process which the company could not comment on.
Corcoran also said that these problems have no impact on Nord Stream 2’s relationships with financial organizations and suppliers.
He said that talks are ongoing with export credit organizations. They have seen reports in the press and have asked the company for information, to which they replied that their shares have not been frozen.
Talks on the provision of guarantees for raising project financing are being held with six ECAs: Germany’s Hermes, Italy’s SACE, Australia’s OeKB, Dutch Atradius, Belgium’s Credendo and the Russian Export Center.
Corcoran said that the company has yet to approach banks as they are preparing documents for the deal and will then present to the banking community.
He said that the amount of guarantees will depend on the results of contract volumes.
He said that the company hopes to receives 4-5 billion Euros in guarantees from ECAs and that they will start talks with banks to raise project financing at the end of this year or the beginning of next year.
The CFO said that Gazprom (MOEX: GAZP) and its foreign partners have spent 2.4 billion Euros each on the project as of the end of June or a total of 4.8 billion Euros.
The project has an estimated price tag of 9.5 billion Euros.
Nord Stream 2, at over 1,200 km in length, will cross the Baltic Sea, connecting Russian suppliers with European consumers. The pipeline will have a capacity for 55 billion cubic meters of gas per year.
