Important step towards
meeting Europe’s energy security demands
Brussels, 6 September 2010. A
mandate letter has been signed today by the European Bank for Reconstruction
and Development (EBRD), the European Investment Bank (EIB), IFC - a member
of the World Bank Group -, the shareholders of Nabucco and NABUCCO Gas
Pipeline International GmbH. The signing of the mandate letter by the three
International Financial Institutions (IFIs) marks the start of the appraisal
process of the Nabucco project, a required step towards a potential financing
package of up to EUR 4 billion. The Nabucco gas pipeline project is the
flagship project for meeting future EU gas demand and will diversify Europe’s
pool of supplier countries.
The potential financing package will
consist of up to EUR 2 billion from the EIB, up to EUR 1.2 billion from
the EBRD (up to EUR 600 million for EBRD’s account and up to EUR 600 million
to be syndicated to commercial banks) and up to around EUR 800 million
from IFC (up to EUR 400 million for IFC’s account and up to EUR 400 million
to be syndicated to commercial banks).
The mandate letter formalises the conditions
under which the three IFIs will conduct their appraisal of the Nabucco
project, and provides an indication of the potential level of financing.
It sets out the work that will be required before a final financing decision
can be taken.
The involvement of the three IFIs is
a demonstration of global and European support for the project and represents
an important milestone in ensuring the overall financing of Nabucco. The
early involvement of the IFIs will support Nabucco in meeting the highest
standards in environmental and social risk evaluation and procurement.
The appraisal of the project will include a thorough assessment of commercial,
social and environmental aspects.
The Nabucco gas pipeline project addresses
the EU’s priority goal of achieving energy security via the diversification
of gas routes and gas supplies. It will deliver additional volumes
of gas from different sources through a new supply route to the EU member
states and their neighbours. Nabucco provides a strategic solution
by enabling the transport of gas from both the Caspian Region and the Middle
Following the successful conclusion
of the appraisal, the financing will need to be approved by the relevant
governing bodies of each IFI. Export credit agencies and international
banks are expected to commence their appraisal of the Nabucco project soon
after the IFIs. Commitments from potential lenders are expected to be sought
IFC, a member of the World Bank Group,
is a global development institution focused on the private sector in developing
countries. IFC creates opportunities for people to escape poverty and improve
their lives by providing financing to help businesses employ more people
and supply essential services, by mobilising capital from others, and by
delivering advisory services to ensure sustainable development. IFC’s
new investments climbed to a record $18 billion in fiscal 2010. For more
information, visit www.ifc.org.
Nabucco Gas Pipeline International
Nabucco Gas Pipeline International GmbH
(NIC) was set up on 24 June 2004 to develop, construct and operate the
Nabucco pipeline. Headquartered in Vienna, it is defined as an unbundled
midstream-company under EU law. NIC is owned by the Nabucco shareholders
and is responsible for the development, construction, operation and capacity
trading and allocation for the Nabucco pipeline. NIC will be the only company
in direct contact with the shippers and will offer a one-stop-shop solution,
operating as an independent economic entity in the market, and acting independently
from its parent companies. The pipeline system will be constructed by the
National Nabucco Companies (NNCs), which are subsidiaries of NIC in each
of the transit countries.