Tallink sells ship for 91 million euros

Tallink has signed a contract to sell one of its largest ships, the Superstar, for 91.5 million euros, to a company operating in the Mediterranean. The ship will be delivered in 2017, once Tallink has a new ship, currently being constructed in Turu, Finland.

Built in Italy, the Superstar began life in 2008, costing the company 120 million euros. It has serviced the Tallinn-Helsinki route ever since.

Tallink’s CEO Janek Stalmeister said nothing will change as the Superstar will continue with the same time schedule and team until the new ship has been delivered to Tallink.

In February 2015, Tallink placed an order for an LNG-powered ferry, which should be complete at the beginning of 2017. The cost is around 230 million euros.

The new vessel will carry 2,800 passengers, 720 more than the Superstar, and is 37 meters longer at 212 meters. Both can travel at a maximum speed of 27 knots.

Source: ERR


Nordic Aviation Group has sold over 31,000 tickets

The new Estonian airline, Nordic Aviation Group (NAG), has sold 31,444 tickets during the five days since launching ticket sales.

“Altogether 6,438 passengers have flown with us and we have made 147 flights,” Nordic Aviation Group spokesperson Liis Veersalu said in a press release.

Formed by the Estonian government and fully owned by the state, Nordic Aviation Group started serving passengers on eight different routes — Amsterdam, Brussels, Copenhagen, Stockholm, Oslo, Kiev, Trondheim and Vilnius — in cooperation with five European flight operators on Nov. 8.

Currently the role of Nordic Aviation is limited to ordering the flights, as the company does not have its own fleet of aircraft or crew yet. The flights are carried out in cooperation with airlines such as BMI, Trade Air, NextJet and Carpatair that provide the fleet and the crews, and Adria Airways that provides the flight operator’s certificate, commercial platform and ticketing system.

Source: Baltic News Service

Read also from ERR: Nordic Aviation Group takes over Estonian Air routes

EC: government aid to Estonian Air was illegal

The Estonian national airline will fold following a decision by the European Commission that funding given to the company by the Estonian government was not in line with EU regulations. The company, founded in 1991, does not have the funds to pay back the state and will declare bankruptcy.

The Commission began an investigation into Estonian state aid to the company in 2013, with Estonian authorities waiting for a decision ever since.

Today, on November 7, the Commission ruled that the around 90 million euros given by the Estonian government to the company, gave the company an competitive advantage over others. This means the government must demand the full amount, plus interest, back from Estonian Air. The state had also earmarked a further 40 million euros, which would have been given to Estonian Air in case of a positive decision. That money will now go to the Nordic Aviation Group.

Commissioner Margrethe Vestager, in charge of competition policy, said: “Companies should compete based on a sustainable business model rather than relying on continued support by the State to stay in the market. Estonian Air has repeatedly received public subsidies over the past five years but did not carry out the necessary restructuring to become viable as a business. It would not be a good use of taxpayer money to keep Estonian Air in the market artificially – nor would it be fair to competitors, which have to compete without such support.”

The crunch question for the Commission was whether a private investor would have acted the same was as the Estonian state, pouring in as much money on the same conditions – if the state aid corresponded with market conditions.

The Commission ruled that Estonian Air received support three times, although EU regulations allow state aid to be given only once a decade. The Commission also ruled that the company did not have a credible restructuring plan and that measures aimed at limiting the distortions of competition were not sufficient.

The end

The government has set up two companies, which will begin to take over from Estonian Air. One (Nordic Aviation Group) will manage Estonian Air’s routes, while the other (Transpordi Varahaldus) will take on lease contracts.

Economy Minister Kristen Michal said on Friday that if a negative decision is made, then the Estonian Air fleet will be grounded from Sunday.

He said those at their destinations will be flown back home and those with tickets for future flights, will receive compensation. Those with an Estonian Air ticket have been asked to go to www.estonianair.ee or call +372 605 8888 for more information.

The board of Estonian Air today decided to halt all business activity from Sunday, November 8.

The company serviced around 500,000 people annually in the last few years, giving employment to 200 people.


It is a sad ending for a company, which became a symbol for newly re-independent Estonia at the beginning of the 1990s.

The company was founded during turbulent times but helped Estonia establish connections with the West. In 1995, the company purchased two brand new Boeing aircraft, giving a boost to a nation trying to rebuild from over 50 years of occupation.

Between 1996 to 2010 the state relinquished controlling shares in the company, and only purchased the company back in 2010 to ensure it did not go bankrupt.

Since 2009, the government has handed around 135 million euros into the company in capital injections, state aid and restructuring aid. The last time the company earned a profit was in 2005.

In 2012, losses amounted to over 50 million euros, from a turnover of less than 100 million. Until then, and after, losses were far smaller. The reasons for 2012 losses were in the company’s drive to expand. In 2011 the state hired Tero Taskila, a Finnish expert who came with a much criticized 30,000 euros per month salary, to take the company to another level. Yet, the plans to expand the company failed. Estonian Air was also hit by higher fuel prices, troubles with aircraft and salary increases.

In 2013, the company embarked on a large-scale restructuring path, cutting its fleet and the number of destinations. Staff numbers were halved.

Source: ERR

Estonian islands get 4 new ferries

Construction of the four brand new ferries commissioned by the state-owned company Port of Tallinn to operate subsidized routes to Estonia’s large western islands is on track and the Turkish and Polish shipbuilders are to deliver the vessels in August next year.

“Construction of the new ferries is on track at the shipyards in Turkey and Poland alike, metalwork is being done, simultaneously work is being done to lay down plans for the vessels’ external design, interior design and ticket selling system,” Sirle Arro, head of the marketing and communication department at Port of Tallinn, told BNS.

“In some stages of construction, such as cutting of metal and ordering of material, they are even ahead of schedule. Our collaboration with the ships’ designer and the shipbuilders is altogether constructive,” Arro added.

Arro also said the port company expects all crew members of the ships currently sailing between the mainland and the western islands to apply for jobs on the new vessels.

On Oct. 31 last year Port of Tallinn signed contracts on the construction of four new passenger ferries for the routes between mainland Estonia and large western islands with Polish Remontowa Shipbuilding and Turkish Sefine Shipyard to build two ferries each.

The ferries are being built in shipyards located in Gdansk, Poland and Altinova/Yalova, Turkey. The 114 meters long vessels will accommodate 150 passenger cars or 12 road trains and have passenger places equipped with safety devices for 700 passengers. The new ferries are designed by the Norwegian company LMG Marin.

Source: BNS

Narva border checkpoint gets 7.5 mEUR makeover

The Narva-1 terminal cost 7.5 million euros to build and is three times the size of the old checkpoint.

The new terminal has eight lanes for pedestrians, 12 lanes for cars and two separate lanes for buses.

The refurbishment will speed up border crossing procedures for regular travelers and contribute to the development of tourism and entrepreneurship in Ida-Viru county.

“Narva checkpoint is one of the most important inland connection routes between the EU and Russia,” Estonian Minister of Internal Affairs Hanno Pevkur said. “The new checkpoint is no doubt a prerequisite for regional growth,” he continued, adding that the redevelopment is also of national importance.

The total cost of the terminal facilities – 7.5 million euros – was paid for by the European Neighborhood and Partnership Instrument (ENPI) and the Republic of Estonia.

Over 3.6 million people use the checkpoint every year to move between Estonia and Russia.

Source: ERR via Estonian Review

EU gives 30 mEUR to develop infrastructure of Helsinki-Tallinn maritime link

The ports of Helsinki and Tallinn together with the listed Estonian shipper AS Tallink Grupp have obtained 29.3 million euros in EU funding within the 2014 CEF Transport Multi-Annual Calls for proposals to finance their infrastructure investments.

The total cost of the planned investments is 97.6 million euros, the state owned company Port of Tallinn said on Monday.

The CEF (Connecting Europe Facility) program is a continuation to TEN-T, under which the initial TWIN-PORT project was started. The follow-up project is called TWIN-PORT II. The development of the Helsinki-Tallinn maritime link as part of the TEN-T North Sea-Baltic core corridor is of vital importance as it connects the northern parts of Europe with southern TEN-T corridors.

“This ongoing effective cooperation with Port of Helsinki and Tallink helps us to develop the link as a whole. It also supports the Twin City idea and the Rail Baltic project,” Ain Kaljurand, CEO of Port of Tallinn, said.

Kimmo Maki, CEO of Port of Helsinki, said the support for investment in the West Terminal building will have a significant impact on the comfort of passengers and smoothness of traffic on the whole Helsinki-Tallinn maritime link.

“The new LNG powered fast ferry will bring swift environment friendly operations to the busy Tallinn-Helsinki route. We are happy to see a successful collaboration between public and private companies that is supported by the European Union,” said Janek Stalmeister, chairman of the management board of Tallink Grupp.

The Helsinki-Tallinn line is one of the busiest international routes in the world, serving about eight million passengers per year, while trucks and trailers carry more than three million tons of cargo per year. The flows of traffic and passengers between the two ports have been constantly growing already for a decade. Therefore the project is crucial for both cargo and passenger flows to ensure smooth traffic between Helsinki and Tallinn.

According to the allocation of the support to develop the Helsinki-Tallinn maritime link from 2015-2018, Port of Helsinki will receive 19.2 million euros to develop traffic and port facilities related to Helsinki-Tallinn line traffic, which includes the new fast flow terminal, ramp constructions for the vessels, gate services and street connections. The total investment of Port of Helsinki amounts to 64 million euros.

Port of Tallinn stands to receive 5.3 million euros to develop several items in the Old City Harbor, such as the port’s sewage system to collect waste waters from ships, extension of terminal D, reconstruction of access to terminal A and connecting the terminals A and D, for a total investment of 17.6 million euros.

Tallink Grupp will receive 4.8 million euros to commission a new environmentally friendly LNG vessel costing 230 million euros to serve the Helsinki-Tallinn line starting from 2017. The investment under TWIN-PORT II is 16.0 million euros.

TWIN-PORT II will lead to maximum efficiency for this short sea line by optimizing port operations and infrastructure and will provide efficiency in a “door to door” approach, minimizing the costs and transit time, while increasing the cooperation and reliability of the transport service between Tallinn and Helsinki.

Source: BNS

EC to finance 82 percent of Rail Baltic project

European Commission has proposed financing the Rail Baltic high-speed railway in the extent of 82 percent which means that the three Baltic countries would have to finance the project with 97.2 million euros.

The European Commission announced on Monday it would grant the request of the Baltic countries for the financing of Rail Baltic in the amount of 540 million euros. Of that sum Estonia’s share would be 213 million euros, while Latvia is to get 281 million, Lithuania 28 million euros and the Rail Baltic joint venture 7 million euros, Rail Baltic project manager Miiko Peris said on Monday at a press conference. The resources can be used as of 2016.

According to Peris about 40 percent of the sum goes toward the preparation works and 60 percent would be used for railway construction.

The next Connecting Europe Facility financing round should take place at the end of the year and additional requests can be submitted for that, he added.

According to the initial schedule the railway should be ready by 2024 or 2025 and the period for using the support should last until that, Peris said. He added that submitting additional requests is definitely necessary.

“According to information known to us the Commission plans to carry out an additional financing round each year. The interest of the Baltic countries is to definitely take part in that but for that we have to show that the project is moving and activities are being carried out,” Peris said.

Source: Baltic News Service via Estonian Review


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