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Oil and gas

We finance the development of oil and gas fields, LNG (Liquefied Natural Gas) extraction, pipelines and storage facilities for natural gas and crude oil.

Financing case Nord Stream Pipeline: Safeguarding Europe's energy supply

The financing of the Nord Stream Pipeline running through the Baltic Sea is a project finance milestone, a key element in safeguarding Germany's raw materials and one of the most significant infrastructure projects for Europe's energy supply. The natural gas pipeline transports the cleanest fossil fuel directly from Russia's gas fields to Western Europe.

Energy supply for 26 million households

Numerous heads of state and government opened the first, 1,224-km-long section of the pipeline in November 2011. 2012 saw another section installed as part of the second project phase. Now, 55 billion cubic metres of gas can be transported through the Nord Stream Pipeline each year, thereby supplying more than 26 million households with energy. The pipeline was built to be operated for at least 50 years.

Renowned awards

Together with other banks, KfW IPEX-Bank has provided 70% of the financing amount in spite of the difficult conditions on the capital markets. The remaining 30% came from Zurich-based Nord Stream AG. Nord Stream AG was founded for the purpose of planning, building and operating the pipeline, and its circle of shareholders is made up of a consortium of Europe's five largest energy companies.

The first financing phase was recognised by two renowned specialist publications, Project Finance Magazine and Global Trade Review (GTR). The innovation, risk minimisation, cost-effectiveness and speed with which the funds were provided were decisive criteria in the prize award process.

Nord Stream Pipeline financing at a glance:

Project profile
  • Investment amount: EUR 4.5 billion (phase I, completed in March 2010) and EUR 2.9 billion (phase II, completed in March 2011)
  • Project finance with partial ECA and United Loan Guarantee cover (export and import guarantees): EUR 3.9 billion (phase I) and EUR 2.5 billion (phase II)
Contribution of KfW IPEX-Bank
  • Involvement in risk analysis, consulting and structuring
  • Mandated Lead Arranger
  • Hedging bank