Joint Wingas, E.ON German Gas Pipeline Seen Delayed By One Year

A natural gas pipeline that is slated to link the giant Baltic Sea transit pipeline Nord Stream to the German gas grid will be delayed by around one year due to pending legal disputes with residents, co-developer E.ON Ruhrgas has said.

The NEL pipeline, which the E.ON AG (EOAN.XE) unit is jointly building with Wingas--a 50-50 joint venture between BASF SE's (BAS.XE) Wintershall AG and Russian gas monopoly Gazprom OAO (GAZP.RS)--will be delayed after residents along certain sections of the pipeline complained about the route.

In light of the ongoing legal dispute, E.ON Ruhrgas has proposed an alternative route, which is now being presented to residents. The approval process for the alterative route could be concluded by autumn 2012, the company said.

The 440-kilometer pipeline will have a capacity to transport 20 billion cubic meters of gas per year. Construction costs of the pipeline are expected to amount to around EUR1 billion. Originally the pipeline was expected to begin operations in autumn 2012.

Nederlandse Gasunie NV of the Netherlands and Belgian gas pipeline operator Fluxys SA (FLUX.BT) also own stakes in the NEL pipeline project.

-By Julia Mengewein, Dow Jones Newswires; +49 69 29 725 503; julia.mengewein@dowjones.com

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