One Kilometer of East Siberian Pipeline Will Cost $8 Million

Gazprom’s pipeline system, which is to deliver natural gas from Eastern Siberia to China and other Asian nations, may become operational in 2017, as the company insists.

The system with the ultimate capacity of 61 bcm a year is not going to be cheap. The 1,420-millimeter pipes capable of withstanding the pressure of 9.8 mPa will span over the distance of about 4,000 km, including marshlands, mountains, and seismic zones. Even though a big portion of the route passes along the existing oil pipeline, it will be hard to save on construction costs.

Designers offered 26 variants of the pipeline’s pattern and a basic one, reportedly selected by the management of Gazprom, will require a capex of $46.12 bln. If parallel lines are added, the length of the linear part will total approximately 5,700 km.

It means that the average kilometer of the pipeline system will cost $8 mln, which is a record even for the notoriously overprices projects of Gazprom.

Published with the kind permission of RusEnergy. Mikhail Krutikhin is with RusEnergy, an independent privately-run company established in 2000 by a group of Russian experts with a long experience in consulting and publishing business. Based in Moscow, it specializes in monitoring, analysis and consulting on oil and gas industry of Russia, Central Asia, Azerbaijan and Ukraine.