EU Energy Commissioner: Nabucco To Cost EUR12 Billion To EUR15 Billion

European Union energy commissioner Guenther Oettinger confirmed the planned natural gas pipeline Nabucco will cost much more than estimated, Dow Jones newsletter EnergyDaily reports Monday.

"Nabucco will cost between EUR12 billion and EUR15 billion," Oettinger said at an energy conference in Stuttgart. Up to now, costs were estimated at EUR7.9 billion.

Germany's RWE AG (RWE.XE) is a member of the Nabucco consortium.

Friday, the consortium said the pipeline, which will carry natural gas from the Caspian Sea to Europe, is expected to transport the first gas only in 2017, two years later than previously scheduled. Construction work was postponed by one year to 2013, according to the managing director of the consortium Reinhard Mitschek.

Mitschek suggested the investment plan is under review and would likely be increased because the pipeline will be extended 20% to 3,500 kilometers by adding a connection to Iraq. He didn't quantify.

An RWE spokeswoman didn't want to comment on cost developments, saying that the financial framework set in 2008 is under review. Therefore reliable numbers are required, she told EnergyDaily Monday.

Alongside RWE, members of the Nabucco consortium are Austria's OMV AG (OMV.VI), Turkey's Botas, Bulgaria's Bulgargaz, Hungary's MOL Nyrt (MOL.BU), and Romania's Transgaz.

-By Klaus Hinkel, Dow Jones EnergyDaily; [phone]; [e-mail]