The European Union (EU) is set to invest €187.5m in the first Estonia-Finland gas pipeline, which will be known as Balticconnector.
EU will also support infrastructure that is needed to unite the energy markets.
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The new pipeline will put an end to the gas isolation of Finland and is set to develop the Baltic regional gas market.
Commissioner for climate action and energy Miguel Arias Cañete said: "Diversifying energy sources and routes, and uniting the energy markets, is at the heart of the Energy Union.
“This is key to ensuring secure, affordable and sustainable energy for all EU citizens.
“What the commission has started with the Poland-Lithuania pipeline (GIPL), we are now pursuing with the support to Balticconnector, promoting a chain of projects that will end the gas isolation of north-eastern Europe and develop the Baltic regional energy market."
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By GlobalDataFinancial support for the new pipeline will be provided by the Connecting Europe Facility programme and corresponds to 75% of the needed funding.
A total of €5.35bn is allocated to European priority projects under Connecting Europe until 2020.
Finland’s Baltic Connector and Elering in Estonia will jointly build the pipeline, which will include Finnish onshore (22km) and offshore (80km) sections, as well as an Estonian onshore (50km).
Balticconnector is expected to be operational by December 2019.
Once completed, the projects will ensure significant benefits for at least two member states and improve security of supply.
Image: The new Estonia-Finland gas pipeline will develop the Baltic regional gas market. Photo: courtesy of European Union.
