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Greece to receive loan from Russia for construction of Turkish Stream — energy minister

June 19, 2015, 10:55 UTC+3
Russia and Greece have signed an intergovernmental cooperation memorandum on construction of continuation of the Turkish Stream natural gas pipeline on the territory of Greece
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© EPA/CARSTEN REHDER

ST. PETERSBURG, June 19. /TASS/. Russia and Greece have signed an intergovernmental cooperation memorandum on construction of continuation of the Turkish Stream natural gas pipeline on the territory of Greece. The signing ceremony was held with the framework of St. Petersburg International Economic Forum on Friday.

The document was signed by Russia’s Energy Minister Alexander Novak and his Greek counterpart Panagiotis Lafazanis.

The Russian minister said Greece will receive a loan from Russia for construction of the Turkish Stream natural gas pipeline continuation. According to Novak, the construction of Greece’s continuation of the pipeline will start in 2016 and finish in 2019.

"The construction will start in 2016 and finish by end-2019," he said.

The minister added that the capacity of Greece’s continuation of the pipeline will reach 47 bln cubic meters.

Greek Energy Minister Panagiotis Lafazanis said the construction of Greece’s part of Turkish Stream worth €2 bln will be financed at halves by a subsidiary of Russia's VEB bank and a Greek company. Russia's energy minister specified that VEB-Capital will become co-founder of the Russian-Greek joint venture.

On Thursday, Novak said Russian companies and banks may participate in financing Turkish Stream ground infrastructure construction in Greece. "The project is at the workout stage so far but the Russian side is ready to take part in financing construction of the infrastructure," the minister said.

In June Russian President Vladimir Putin and Greek Prime Minister Alexis Tsipras had a telephone conversation, after which it was reported that the leaders of the two countries "agreed to meet at St. Petersburg International Economic Forum on June 18-20."

The leaders of Russia and Greece have enhanced contacts recently, often discussing the Turkish Stream project, which implies gas supplies from Russia to Greek borders.

Infographics Russia's gas pipelines to Europe by 2018 Russia's gas pipelines to Europe by 2018

Russia's gas giant Gazprom intends to completely abandon gas supplies to Europe through Ukraine after 2018 with the help of a new pipeline to Turkey. Infographics by TASS

The Turkish Stream will serve as an alternative to the South Stream gas pipeline project abandoned by Russia in December 2014. The larger part of the Turkish Stream pipeline will run across the Black Sea and coincide with the South Stream route approved earlier.

Unlike the South Stream, which implied a large-scale infrastructure construction in Europe, the Turkish Stream project is limited to the construction of a pipeline under the Black Sea and a gas hub on the border between Turkey and Greece. The remaining part of infrastructure will have to be built by Gazprom’s European customers themselves.

Earlier, Gazprom CEO Alexey Miller said that the construction of the first stretch of the Turkish Stream would start in late June. The pipeline is scheduled to begin operation in December 2016, he said.

The Turkish Stream will have an annual capacity of 63 billion cubic meters, of which 47 billion cubic meters will be delivered to a new gas hub on the Turkish-Greek border. Gazprom Russkaya Company will be in charge of the Turkish Stream gas pipeline construction.

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