March 2

Vienna agrees to fund 40km pipeline to boost gas independence from Russia

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The Austrian government has agreed to provide an undisclosed part of €200 million for building a pipeline to boost the country’s ability to import natural gas via Germany, amid growing political pressure to reduce dependence on Russia.

Construction of a key pipeline connecting Austria to Germany has been stalled for years but Vienna –  wrestling with its continued gas dependence on Russia – has now promised funding.

“Who bears the costs has been clarified. Now it’s actually about the implementation,” Chancellor Karl Nehammer (ÖVP/EPP) told APA, adding that the project was on the finishing line. He did not say how much of the €200 million price tag will come from Vienna.

The expansion of the West-Austria-Gas pipeline, known colloquially as WAG Loop 1, will boost Austria’s ability to import gas from Germany by a whopping 2.5 million cubic meters per year – more than a third of its total annual demand.

A mere 40 kilometres of pipeline will need to be built and could be completed by late 2027 – just in time to meet the EU deadline for getting out of Russian gas. It would allow Austria to import all the gas it needs from the LNG terminals along Europe’s coast via the German territory.

Other obstacles, like Berlin’s attempt to have its EU neighbours pay part of the bill for its 2022 gas buying spree, are likely on their way out.

The last challenge that remains is Austria’s hands-tied contract with Russian state company Gazprom until 2040. Here, too, political momentum is building to break the contract.

[Edited by Zoran Radosavljevic]

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