The project is a concrete proof of the commitment by which Romania supports Moldova in strengthening energy security and integration within the EU energy market, the economy ministry said in a press release.
"I welcome the start of the second phase of Iasi-Ungheni-Chisinau interconnection project. It is concrete, palpable evidence of Romania's commitment to contribute to energetic and regional security," Romanian economy minister, Niculae Badalau, said.
Eurotransgaz, the Moldovan subsidiary of Romanian gas pipeline operator Transgaz [BSE:TGN], received a 38 million euro ($43 million) loan from the European Investment Bank last month to provide financing to Moldova's Vestmoldtransgaz for the interconnection project. Transgaz took over its Moldovan peer Vestmoldtransgaz in September for 8.8 million euro through Eurotransgaz.
"The project represents a geopolitical gain, aiming to reduce the energy dependence of the Republic of Moldova through the alternative route it proposes, as well as a contribution to the general strengthening of the country's pro-European path," Transgaz general manager, Ion Sterian, said.
The Ungheni - Chisinau project involves the construction of a 120-kilometre long natural gas pipeline, three gas delivery stations as well as the procurement of equipment. The first section of the pipeline linking Iasi and Ungheni was put into operation in 2014 and can transport about 1.5 billion cubic meters of natural gas per year. The city of Iasi is located in northeastern Romania, while Moldova's Ungheni is situated near the border between the two countries.
Moldova started importing natural gas from Romania in 2015 for the first time in its history in a move to cut its dependence on Russian gas.
In January, Romanian prime minister Viorica Dancila said that the construction of the Ungheni-Chisinau natural gas transmission pipeline in Moldova remains one of the top priority projects of her government.
Shares of Transgaz traded 3.42% higher at 348 lei on the Bucharest Stock Exchange by 1310 CET on Monday.
