Russian gas firm OAO Gazprom (GAZP.RS) and Hungarian Development Bank have agreed to set up a joint venture for the construction of the South Stream gas pipeline through Hungary, Gazprom said Tuesday.
The South Stream pipeline, which will bring gas from Russia and Central Asia to European consumers via an underwater link beneath the Black Sea, is seen as a rival project to the European Union-supported Nabucco pipeline project.
Russian Prime Minister Vladimir Putin said the South Stream project will cost $10 billion, but that financing problems remain, the Interfax news agency reported Tuesday.