October 21, 2008 / 1:46 PM / 9 years ago

Iran gas should be option for Nabucco: OMV

<p>CEO of Austrian oil company (OMV) Wolfgang Ruttensdorfer gestures at the Reuters Central Europe Investment summit in Vienna October 21, 2008. REUTERS/Dominic Ebenbichler</p>

VIENNA (Reuters) - The European Union-backed Nabucco gas pipeline should not exclude Iran as a long-term supplier, lead consortium member OMV (OMVV.VI) said on Tuesday.

The EU has made the 7.9 billion euro ($10.46 billion) pipeline a cornerstone of its policy to ease its dependence on Russian gas but has been reluctant to list Iran among major potential suppliers for political reasons and because of opposition from the United States.

“The second largest gas reserves in the world are in Iran. Therefore to build the Nabucco pipeline and say it should not transport Iranian gas would not make sense,” OMV chief executive Wolfgang Ruttenstorfer said.

He told the Reuters Central Europe Investment Summit that lining up supplies from Caspian countries like Azerbaijan and Turkmenistan was a priority but Iranian gas remained a long-term supply option for the project.

Last month, the head of Hungarian oil and gas group MOL MOLB.BU, another of the Nabucco partners, said the project would become a reality if Iran came on board.

Ruttenstorfer said Iraq was another possible supplier to the 30 billion cubic meter project.

The Nabucco plans to bring Caspian and Middle Eastern gas from Turkey to OMV’s Austrian gas hub via Bulgaria, Romania and Hungary, and become operational in 2013.

But the project has been delayed many times and faces uncertainty over whether it can secure enough supplies from nations once part of the Soviet Union and which are subject to intense lobbying by Russia’s Gazprom (GAZP.MM).

<p>Pipes and valves are seen in this file photo, March 3, 2008. REUTERS/Konstantin Chernichkin</p>

Russia’s recent war with Georgia -- a transit route for Caspian oil and gas -- has highlighted the frailty of previous Western efforts to bypass Moscow.

Officials in Bulgaria and Turkey and some industry analysts have warned that Nabucco is under threat unless the EU moves at a high political level to secure supplies from the Caspian region and do more to support the project.

But Ruttenstorfer said Brussels had been very active in backing Nabucco in the recent months.

“It’s fair to say that right now this project gets all the support it needs from Brussels.”

Nabucco’s shareholders include OMV, MOL, Romania’s Transgaz TGNM.BX, Bulgaria’s Bulgargaz, Turkey’s Botas and Germany’s RWE (RWEG.DE). Allowing a seventh partner to join the consortium was not among the current priorities, Ruttenstorfer said.

Czech power utility CEZ CEZPsp.PR, one of the leading power suppliers in central and eastern Europe, said it was considering joining Nabucco at some stage to secure supplies for planned gas-fired plants.

“If we see a chance, we might join it,” Alan Svoboda, CEZ chief sales officer, told the Reuters summit. He said other mid- stream players were also interested in the project.

Ruttenstorfer played down the challenge facing Nabucco from a rival Gazprom pipeline, South Stream, which is due to bring more Russian gas to south-eastern and central Europe to meet growing demand.

He said Europe’s growing demand meant it would need both pipelines and OMV was interested in joining the Russian project as well but talks with Gazprom had not been finalised.

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