Nord Stream says overland route not an option

HELSINKI, April 14 Mon Apr 14, 2008 4:25pm BST

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HELSINKI, April 14 (Reuters) - The Nord Stream consortium sees the Baltic Sea as the only route for its planned gas pipeline linking Russia and Germany and will not consider an overland alternative, its CEO said on Monday.

Nord Stream, majority-owned by Russian gas export monopoly Gazprom (GAZP.MM) and whose minority stakeholders include Germany's E.ON EONG.DE and BASF BASF.DE, has faced criticism over the pipeline's ecological impact on the Baltic seabed.

Poland, fearing Nord Stream bypassing its territory would enable Russia to cut off crucial gas supplies to the country, while continuing to deliver to Western Europe, backs the proposed Amber land pipeline stretching across the Baltic countries.

But Chief Executive Matthias Warnig said an overland route was not an option.

"The shareholders gave our company the order to build an offshore pipeline through the Baltic Sea and in that they are investing millions of euros," he told Reuters at an event in Helsinki.

"The order is not -- and it's not up for debate -- to have an overland route as an alternative solution for Nord Stream."

"We have to optimise our pipeline, the laying of it and the technology that we are using so that it is environmentally friendly," Warnig said.

He added the deadline of deliveries starting in 2011 and planned cost of 7.4 billion euros ($11.7 billion) were still valid, despite environmental delays.

"We are devoting more time to this process, but we have also made technological progress which allows us to build the pipeline faster, so that the deadline of 2011 remains valid for us." (Reporting by Agnieszka Flak; editing by James Jukwey)