Deal signed for world's biggest undersea pipeline

Nord Stream has signed a deal with top Russian pipe maker OMK to build the world's largest undersea pipeline, carrying oil from Siberia to the West in a deal valued at more than 250 million euros.

The project will counter the blocking tactics of some Baltic countries.

Nord Stream and top Russian pipe maker OMK penned the deal to build Europe’s biggest undersea gas pipeline.

Construction across the Baltic was due to start next year, but has now been delayed until 2009.

On a tour of the OMK factory, Nord Stream’s technical director blamed protests from Baltic States, through whose waters the project passes, for the delay.

The company’s boss told RT the battle lines are now being drawn, between countries set to gain from the pipeline, and other EU nations raising objections on economic, political and business grounds.

“Some members of the European Union will get direct benefit from our pipeline – that means getting direct supply. These are countries like Germany, France, Denmark and the UK. Other countries, like Poland, Latvia, and Estonia, do not have direct benefits but in this period of EU they should at least tolerate the project if we meet environmental concerns,” said Matthias Warnig, CEO of Nord Stream.

OMK’s president revealed the project’s record global ambitions.

“At 1420 mm wide no one else in the world is making pipes this big, let alone underwater. Just running the small army of ships to install the pipes will cost a million dollars a day,” said Vladimir Markin, the President of OMK Metallurgy, Vyksa, Nizhny Novgorod region.

Sweden denied that it was calling for the re-routing of the pipeline but continues to insist on extra environmental checks. The EU has threatened to stop the pipeline in Germany if owner Gazprom does not allow other gas companies access. Only once Nord Stream overcomes these challenges can the pipeline complete its planned journey through Germany to the Netherlands and the UK.