afrol News, 18 September - European Union has offered to pump US$21 billion to help Nigeria develop trans-Saharan pipeline to take gas from Nigeria to Europe. The move is part of plans to reduce EU reliance on Russian energy supplies.

The project, which stretches a distance of 4,300 kilometers across Sahara desert - Nigeria (1,050km); Niger (750km), and Algeria (2,500km) when completed will connect Nigeria’s gas reserves to Europe though Algeria’s Mediterranean coast.

A top presidential source disclosed that EU’s latest expression of interest in project came amidst fears that Gazprom, a Russian gas company, might win contract as part of a strategy to tighten its grip on energy supplies to Europe. Gazprom has recently signed a memorandum of understanding with Nigerian government.

EU energy commissioner Andris Piebalgs who visited Nigeria last week, admitted that European governments had been slow to back trans-Saharan pipeline in the past but said after Georgia conflict they had focused minds.

"In the EU, particularly after Georgia, there is also a lot of demand from member states to have diversification, real diversification, of supply. EU governments definitely are worried about having too strong a dependency on Russia," Mr Piebalgs said.

Russia, which already supplies a quarter of gas consumed in EU, has sought to increase its control by seeking deals with producers such as Nigeria and Libya, and backing moves to form an OPEC-style gas cartel.

Mr Piebalgs said EU was increasingly keen to promote trans-Saharan project as an additional option, perhaps by helping to fund feasibility studies and playing a co-ordinating role between host countries Nigeria, Niger and Algeria saying European Investment Bank could help finance the project.

“We need to follow where the Nigerian government is leading us, and the Nigerian government is very clearly leading towards a pipeline. That means we should be more engaged in the trans-Saharan gas pipeline,” he said.

President Umaru Musa Yar’Adua has expressed happiness with EU offer of assistance on proposed construction of Trans-Saharan gas pipeline from Nigeria to Algeria.

The project was initiated by former president Olusegun Obasanjo government but appeared unattractive to foreign investors due to what members of Organised Private Sector (OPS) described as lack of seriousness on the side of Nigerian authorities.

EU officials say the pipeline could supply 20 billion cubic metres a year of gas to Europe by 2016. The bloc consumes some 300 billion cubic metres a year but demand is projected to double by 2030, prompting a search for new sources from Caspian Basin to Iraq and Qatar as domestic production declines.

By staff writer

© afrol News

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