The Nord Stream project has successfully secured €2.5bn for phase II of the offshore gas pipeline project to connect Russia and the European Union via the Baltic Sea.

The funding is partially contributed by Nord Stream’s shareholders who are providing 30% of the total project cost in proportion to their holdings in the firm, with the remaining 70% sourced from the bank market.

Twenty-four banks are participating in the project’s external financing.

The Nord Stream project will be 1,224km long, comprising two parallel lines. The first pipeline, which will have a transmission capacity of 27.5 billion cubic metres a year, is expected to be completed this year.

The second line is due to be completed in 2012 and will bring the annual capacity to 55 billion cubic metres, serving over 26 million European households.

OAO Gazprom has a 51% share in the pipeline project, with E.ON Ruhrgas and BASF / Wintershall each holding 15.5% and NV Nederlandse Gasunie and GDF SUEZ with 9% each.