Sberbank May Give Loan for Construction of Third Section of Baltic Pipeline System

Sberbank is considering the possibility of granting a loan for construction of the third section of the Baltic pipeline system. This was announced to a Rosbalt correspondent by Company President Semyon Vainshtok, who is also the pipeline owner. He said that there is an agreement between Transneft and Sberbank on a loan for construction of the third section. 'The loan could be around USD 1 billion,' said Mr Vainshtok. 'Transneft will find a further USD 500 million from its own resources.'

Mr Vainshtok has said that this stage of construction could begin in the first quarter of 2003. The third section will include a new Yaroslavl-Kirishi-Primorsk pipeline and expansion of the Ukhta-Yaroslavl pipeline. The total increase in oil transportation will be about 18 million tonnes a year. Transneft handed over plans for the third section for government approval at the end of last year.

The first section was completed at the end of 2001. This project cost USD 460.2 million. This first section is able to transport 12 million tonnes of oil a year. Construction of the second section began in September 2002, although at the end of December Mr Vainshtuk announced that the third section would include construction of all the necessary pipelines, bypassing the second section.

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