The European Investment Bank (EIB) in the second half of October approved the provision of a EUR 150 million financing to reconstruct the Urengoi-Pomary-Uzhgorod gas pipeline used to supply Russian gas to Europe by the Ukrainian gas transport system operator Ukrtransgaz.

According to a report of the bank, it is planned to replace several sections of the gas pipeline of 119 kilometers long and two compressor stations.

EIB said that the total cost of the project is EUR 355 million.

The bank said that the loan is provided as a part of political guarantees of the European Union (EU) for transactions outside the EU.

The European Bank for Reconstruction and Development (EBRD) also said on Tuesday that the bank could provide up to $200 million to reconstruct the Urengoi-Pomary-Uzhgorod gas pipeline. The EBRD board is to approve the project on December 10, 2014.

According to the EBRD's materials, the project consists of the replacement of four sections of the Urengoi-Pomary-Uzhgorod gas pipeline, which are in need of repair as well as the modernisation of the Romny gas compression station. The project will be implemented by public joint-stock company Ukrtransgaz.

EBRD said that a total project cost is up to $ 600 million.