BRUA with steel made in China

Arcelor Mittal wants to produce in Romania the steel for BRUA pipeline and sued the Romanian state for being rejected from the auction.

By Emilia Damian

ArcelorMittal Galati challenged the tender for the designation of the BRUA pipeline builder after it was removed for lack of a document that was not relevant to the project, said Bruno Ribo, general manager of the steel plant.

“We still hope to be able to participate in this project. We have been eliminated and challenged the auction. We have been removed because we lacked a document, we did not realize that the paper was missing and we did not have time to submit it in due time. It is a purely formal matter. When we were informed that we were missing, we were ready to correct this, but the bidding period was closed, so our offer was not validated, “Ribo said, in an interview with the Romanian national news agency, Agerpres.

According to him, the document that was missing from the file was not relevant to the substance of the matter.

“Somehow it was a mistake on our part, but it was a formal reason that was not related to the substance of the formula. We are in court with this matter, I cannot comment more, but I think we should give more importance to the background problem, not form, because we are capable of producing and it would be totally abnormal as public funds, European funding, to fund a project based on thick blackboard produced in China. It is something that has not been heard before. Romanians pay taxes and they have jobs in China, ” the ArcelorMittal official continued.

What was missing

He said the document was a statement that there is no conflict of interest with Transgaz’s new CEO.

“We filed this document for the former CEO, but the CEO changed during the bidding process and asked us to deposit this paper with the new name. We submitted the offer with three other partners in a consortium, thick, and missing one of the four papers, “explained the head of the steel producer.

Ribo argued that ArcelorMittal has the capacity to produce the entire quantity of steel for the BRUA pipeline in Galaţi, namely 110,000 tons, which means 480 kilometers of welded pipe than the gas pipeline in Romania.

“We produce about two million tons of steel per year in Galaţi and this volume can be delivered between 12 and 18 months. This volume was very important for our Galati pipe plant. It will be such a shame that, for a small mistake, to have a gas pipe that is made with a thick steel pipe produced in China, “Ribo added.

On November 28, the signing ceremony for works for the execution of the natural gas pipeline – Phase 1, took place within the BRUA Project. Contracts were signed by Ion Sterian, general manager of the Transgaz National Gas Transmission Company, Karl Leidenfrost, manager of the Austrian Habau PPS Pipeline Systems, and Petre Mustăţea, general manager of Inspet SA Ploieşti.

The BRUA Gas Interconnection project, estimated at over € 500 million, has received a € 179 million grant from the European Commission under the Connecting Europe Facility.

Money from EIB

A first loan in lei (Romania’s national currency, ed. n.) worth EUR 50 million is going to be granted to Transgaz on behalf of the European Investment Bank (EIB), announced the bank in a press release.

The EIB funds will finance the construction of a new European natural gas transport corridor (BRUA) to increase the gas supply security and cut energy dependence by diversifying sources and supply routes.

It is the first EIB loan in lei to a company since the launch of the bank’s operations in Romania in 1992. The credit will offer Transgaz a bigger flexibility to avoiding exchange rate risks in financing the region’s gas infrastructure. The project is aimed to contribute to the increase of the number of gas suppliers in South-Eastern Europe and open the regional market to an increased competition, says the EIB Vice President Andrew McDowell.

“To our company, this financing line is part of a set of key-measures we count for our large infrastructure projects,” SNTGN Transgaz SA managing director, Ion Sterian, says.

The new pipeline is the first stage of the BRUA pipeline’s Romanian section. The Transgaz-Brua Gas Interconnection project the costs of which are estimated to over EUR 500 million, has received a EUR 179 million on behalf of the European Commission within the Europe’s Connection Facility.

The EIB funds will finance the construction of a 478-km natural gas pipeline between Podisor and Recas, as well as of three compressor stations at Podisor, Bibesti and Jupa, all of which on Romanian territory.

“This volume was very important for our Galati pipe plant. It will be such a shame that, for a small mistake, to have a gas pipe that is made with a thick steel pipe produced in China” – Bruno Ribo, CEO of ArcelorMittal Galati

 

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