The EIB and the EBRD are each lending EUR41 million and the EU is providing a EUR10 million grant. The funds will be extended to Î.S. Vestmoldtransgaz, a state-owned company which will build and operate the gas pipeline and the Romania-Moldova interconnector, the EBRD said in a statement.
The project will complete the connection of the gas transmission systems of Romania and Moldova by linking Chisinau, a major area of gas consumption in the country, to the interconnector between the eastern Romanian city of Iasi and Ungheni, a Moldovan town on the Romanian border. It was built in 2014 to enable Moldova – a country which is more than 90 per cent dependent on energy imports – to diversify its energy sources. The EU provided a EUR7 million grant for the interconnector.
As part of the new financing package, the Moldovan government has agreed to implement a comprehensive reform package to promote the liberalisation of the energy market and strengthen competition in the sector.
Additional support comes from the Swedish International Development Cooperation Agency (Sida) which has provided nearly EUR600,000 for a comprehensive feasibility study conducted by the engineering consultancy Fichtner GmbH to assess technical, market, regulatory, economic and environmental and social aspects of the project.
The EBRD is also providing EUR1 million grant financing from its own funds to support the implementation of the project, including legal and regulatory assistance.
The EIB – the European Union’s bank – finances projects in Moldova on the basis of an EU mandate for the countries of the Eastern Neighbourhood, the so-called External Lending Mandate (ELM).
The EBRD is the largest institutional investor in the Moldova, with over €1.1 billion of cumulative investment in more than 110 projects in agribusiness, energy, the financial sector, infrastructure and manufacturing.