Finnish court actions could delay Baltic gas link

HELSINKI Tue Jan 15, 2008 2:22pm GMT

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HELSINKI (Reuters) - Environmental concerns in Finland over the Nord Stream consortium's plans to build a gas pipeline under the Baltic Sea from Russia to Germany could cause months or even years of delay to the project, officials said.

Nord Stream, majority owned by Russian gas export monopoly Gazprom, plans to start building the 1,200 km (750 mile) pipeline in mid-2009 and begin deliveries in early 2011.

But environmental organizations in Finland said an environmental permit would come at the earliest in 2009 and possible appeals could mean delays to the start of gas flows.

While Nord Stream plans to route the link through the Finnish economic zone of the Baltic Sea, environmental campaign groups say they will go to court to make the company fully examine an alternative, southern route that may cause less harm.

Nord Stream plans to hand in an environmental impact assessment to the Finnish Uusimaa region environmental centre in April and the centre is expected to report four months later.

The firm also needs permits from the Finnish government and the Western Finland Permit Authority to build in the zone and aims to apply soon after submitting the impact assessment.

An official at the authority said processing the application was likely to take eight to 14 months but, if the decision went to court in Finland, it could take more months or years.

On average, environmental cases took 14 months in Finland's administrative courts last year and almost 10 months in the supreme administrative court.

The World Wildlife Fund (WWF) and the Finnish Association for Nature Conservation said they feared that decisions might be hurried without due regard for the impact on the Baltic Sea.

Nord Stream is expected to be able to cover more than a quarter of Europe's incremental gas demand.

HUGE POLITICAL PRESSURE

"There is a huge political pressure to build the pipe, it is likely that decisions will be made fast without thinking too much," the association's spokesman Matti Nieminen said.

While countries including Poland, Sweden and the Baltic states have raised concerns over the project's environmental and security impacts, Finland's cabinet has supported the pipeline.

But Foreign minister Ilkka Kanerva said the environmental assessment should not be considered a pure formality.

"If it (the pipeline) creates problems, those have to be solved," he told Reuters this month.

WWF said it might file a court case against Nord Stream if the company did not make a proper environmental assessment for a potential alternative route on the southern side of the Russian island of Gogland, more than 50 km south of Finnish coast.

"The environmental assessment process requires that all possible alternatives are investigated to find the one that has the smallest possible impact," said Anita Makinen, head of WWF Finland's marine program.

Nord Stream spokesman Sebastian Sass said it had examined the southern route, but had not found a suitable passage.

He said Russia was planning a conservation area near Gogland and that there were already subsea cables there, while it was a main route for ships and therefore unsuitable.

"Our point of view is that our applications will stand any examination," Sass said.

But environmental groups said less disruption would be caused to the fragile ecosystem by using the southern route, as the sea bed was flatter and would need less work and disruption to waste, including dioxin, around the sea bed.

"If the sea bed (in the Finnish economic zone) was covered with rock material, it would kill plants and could move hazardous waste piled up on the sea bed," said WWF's Makinen.

The Nord Stream consortium is owned by Gazprom, with 51 percent, German firms BASF and E.ON with 20 percent each and Dutch pipeline operator Gasunie with 9 percent.

Two pipelines are planned, each with annual capacity of 27.5 billion cubic meters, one starting up in 2011 and one in 2012.

(Reporting by Terhi Kinnunen, additional reporting by Tarmo Virki, editing by Anthony Barker)

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