Polish PGNiG plans to join Nabucco -Hungary govt

BUDAPEST Tue Jan 27, 2009 12:48pm GMT

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BUDAPEST Jan 17 (Reuters) - Polish gas company PGNiG PGNI.WA plans to join the Nabucco pipeline project, Hungary's government, the host of a conference on the project said in a statement on Tuesday.

The government quoted Polish Prime Minister Donald Tusk as saying in a letter to his Hungarian counterpart, Ferenc Gyurcsany, that Poland supported the Nabucco project which could help diversify Europe's gas supply.

"Donald Tusk ensured the Hungarian prime minister that Poland backs the project and indicated that PGNiG, the country's biggest gas producer and importer, plans to join the Nabucco project," the statement said.

It did not specify how the Polish company would take part in the project.

The overall cost of Nabucco project is seen at 7.9 billion euros ($10.43 billion).

It is due to span 3,300 km (2,051 miles) and meet 5 percent of Europe's gas needs. Nabucco will bring 31 billion cubic metres of Caspian or Middle Eastern gas annually from Turkey to an Austrian gas hub via Bulgaria, Romania and Hungary.

Consortium members, who include Austria's OMV (OMVV.VI), MOL MOLB.BU of Hungary, Romania's Transgaz, Bulgargaz, Turkey's Botas and RWE (RWEG.DE) of Germany have said the European Union should provide either prefinancing or guarantees to convince commercial banks and suppliers the project is viable. ($1=.7573 Euro) (Reporting by Sandor Peto; Editing by Sharon Lindores)