25-01-01 Finnish Prime Minister Paavo Lipponen says that Russian natural gas from the Barents Sea is to be carried to European buyers through a pipeline partially running through Finnish territorial waters. During a two-day working visit to Moscow, Lipponen met with both Prime Minister Mikhail Kasyanov and President Vladimir Putin.
According to Lipponen, Finland and Russia have reached agreement in principle on the routing of the pipeline. He says that the pipeline would start at the rich natural gas fields in the Barents Sea in the far north of Russia, down to Vyborg, from where it would continue through Finnish territorial waters, and then turn south across the Baltic Sea to Germany.
The planned capacity of the pipeline would be 20 bn cmpy, and the projected costs are FIM 20 bn. "The next stage in this project is the establishment of an international consortium. International partners will be needed, possibly Germany's Ruhrgas", Lipponen said. Preparations for the construction of the pipeline havebeen made by the Russian gas giant Gazprom and Finland's Fortum.

The energy companies sought the support of the Finnish and Russian governments for the project. They appealed to the prime ministers of the countries with a letter signed by Gazprom Director General Rem Vyakhirev and Fortum's Chairman of the Board Matti Vuoria a few days before Lipponen's visit to Moscow. Lipponen says that Russia's government is discussing the gas pipeline project along with two other pipeline projects.
Russia is planning a fairly tight schedule. If it starts to build the alternative involving Finnish territorial waters, it should be ready by the year 2007. According to Lipponen the discussions also involved the long-standing plans for the exploitation of the Stokmanovskoje gas field in the Barents Sea. Fortum is one of the owners of the field.
The pipeline issues are part of Russia's energy dialogue with the European Union which began at the Paris summit last autumn. "I hope that the EU Commission would manage to appoint its own working group, so that the dialogue would begin", said a somewhat critical Lipponen.

Lipponen said that his talks with Prime Minister Kasyanov also included the Russian oil terminal at Primorsk on the Gulf of Finland which is now under construction, and which is scheduled for completion in December this year.
Lipponen said that Kasyanov has seen to it that Finnish officials have received information about the environmental impact studies made by Russia. "Next we will develop transport in the Gulf of Finland. The Russian Minister of Transport said that Russia wants to act responsibly in this question", Lipponen said. He pointed out that the oil terminal will lead to a massive increase in traffic in the Gulf of Finland, which is a matter of great concern for Finland.
Lipponen said that international cooperation is needed so that agreement could be reached in the coming spring that only double-hulled tankers would be allowed into the Gulf of Finland. Lipponen envisioned the same kinds of strict safety rules for the Gulf of Finland as the ones that are in force in the Straits of Denmark and the English Channel.
Another question that came up was the planned Eurorussia agreement, which would allow the export of goods such as electronic components from the EU to Russia and the import of finished goods from there without customs duties or cumbersome formalities. The agreement is expected to create thousands of new jobs in St. Petersburg and other parts of Russia near the Finnish border. The Finnish-Russian economic commission founded last autumn will hold its next meeting in Finland in April. By that time many issues concerning the gas pipeline and maritime traffic on the Gulf of Finland should be resolved.

On his talks with President Putin, Lipponen said that the two had focused on security policy. According to Lipponen, the Russian President is in favour of the enlargement of the EU. "He also hoped that the EU would be open to development of ties with Russia", the Prime Minister said.
According to Lipponen, Putin had interesting comments on Russia relations with the Baltic countries. "According to the President, Russia wants to cooperate with the Baltic countries, and will develop bilateral relations with each of them. He also hoped that the Baltic countries would follow the line of cooperation instead of conflict", Lipponen said.
He confirmed that President Putin is coming to Finland for an official visit in September. Lipponen also said that the state treaty between the two countries has worked flawlessly, and that there is no reason to change it.