June 25, 2008

Burgas-Alexandroupoli Oil Pipeline Could Cost 1.5bln Euro

MOSCOW. June 25 (Interfax) - Preliminary estimates of the cost of the Burgas-Alexandroupoli oil pipeline stand at 1.5 billion euro, Nikolai Seryogin, a member of the Supervisory Board at Trans Balkan Pipeline BV, who represents Gazprom Neft (RTS: SIBN) in the project, told journalists.

Back in 2007, the project was estimated at 1 billion euro, he said.

The cost has been adjusted for inflation and growing metal and pipeline product prices, Seryogin recalled.

The Balkan oil pipeline is an oil transport system that is 285 kilometers long, with initial production capacity of up to 35 million tonnes a year (with a possibility to increase capacity up to 50 million tonnes), and it is designed to bypass the Bosphorous Strait. It will extend from the Bulgarian port of Burgas in the Black Sea to the Greek town of Alexandroupoli in the Mediterranean Sea.

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