When completed by the end of 2019, the 150-km pipeline will link Finland with the European natural gas system. The country now relies on Russia for all its gas.
The final investment decision came after Baltic Connector, the European Commission, and Elering AS of Estonia signed a construction agreement.
The EC has granted €187.5 million to the project form its Connecting Europe Facility for Energy, covering 75% of the total construction cost. The government of Finland has committed €30 million to the project.
The bidirectional Balticconnector pipeline is to have capacity of 7.2 million cu m/day. About 82 km of the pipeline will be subsea. Of the onshore portion, 22 km will be in Finland, and 47 km will be in Estonia.
In a related project, the Connecting Europe Facility is helping to fund the €558 million cost of a 534-km pipeline linking Lithuania and Poland. Of the total length, 357 km is to be in Poland and 177 km in Lithuania.
Completion of the Gas Interconnection Poland-Lithuania project also is due by the end of 2019.
The EC and governments of Poland, Lithuania, Latvia, and Estonia reached agreement on construction of the project last October.