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    EBRD Invests in Moldova Gas Pipe Operator


The bank is taking a 20% stake in the company that will deliver gas from new sources, competing with Russian Gazprom.

by: William Powell

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Natural Gas & LNG News, Europe, Premium, Corporate, Mergers & Acquisitions, TSO, News By Country, Moldova, Romania

EBRD Invests in Moldova Gas Pipe Operator

The European Bank for Reconstruction and Development (EBRD) is investing €20 ($24)mn and taking a 25% stake in Vestmoldtransgaz, the operator (TSO) of the newly built €90mn Ungheni-Chisinau gas pipeline, it said August 27. The line is due to start this month.

Founded in 2014, Vestmoldtransgaz owns and manages a gas pipeline network in western Moldova. In 2018 it was taken over by Eurotransgaz, a subsidiary of Romania’s national TSO Transgaz.

The 120-km line links the Romanian town of Ungheni with the Moldovan capital Chisinau and completes the connection of the two countries' gas transmission systems. It will enable Moldova – a country more than 90% dependent on energy imports – to diversify its energy sources.

Moldova, a former Soviet Republic, is a split country, with the Transnistria region under Russian control. Russian generator Inter RAO owns a 2.5-GW plant there that uses most of the country's 2.9bn m³/yr of gas to supply most of the country's power.

The bank's support for Vestmoldtransgaz covered the environmental and social component of the pipeline so that it met the highest standards. It said the connection will "enhance Moldova's energy security by diversifying its gas supply sources, a prerequisite for the country's successful development. The project also helps integrate Moldova into future major gas infrastructure projects such as the Trans Adriatic Pipeline and gas sources from central European hubs, and links it with Black Sea gas deposits. Greater integration will deliver economic benefits for consumers.”

Other funding included a €38mn loan from the European Investment Bank and an equity investment from Eurotransgaz. In 2016 the EBRD offered to support the project with a government loan but when Vestmoldtransgaz was privatised it decided to buy a stake in the company instead.  

Since the start of its operations in the country, the bank has invested over €1.3bn in Moldova’s financial, agribusiness, energy, infrastructure and manufacturing sectors.