The Guardian: Nabucco costs double

PanARMENIAN.Net - Plans to build a gas pipeline to the heart of Europe to reduce dependence on Russian imports have been dealt a blow after estimated costs almost doubled.

The proposed 2,000-mile (3,200km) Nabucco pipeline would transport gas from British Petroleum's $20bn (£12.3bn) new project in the Caspian Sea to Austria via Turkey and the Balkans.

The consortium of European energy companies, which are competing against two smaller pipeline projects, currently estimates the cost at €7.9bn (£6.7bn), according to the Guardian.

But the Guardian has learned that BP's own assessment puts the cost at around €14bn, partly because of soaring commodity prices. The price of iron ore, a key ingredient for steel, has increased by half in the past year.

Doubts are already growing over Nabucco's viability because it aims to draw in gas from undeveloped fields in Turkmenistan and Iraq, as well as Azerbaijan.