KIEV, April 27 (Itar-Tass) - Russia’s natural gas monopoly Gazprom and Italy’s ENI energy giant will cede 10 percent of their share in the South Stream project each to Electricite de France (EDF), Russian Prime Minister Vladimir Putin told journalists on Tuesday commenting on a statement he made in Milan that the French company would get a stake (20 percent) in the project. “We are doing it with the Italians on a coordinated basis,” he said explaining that the Russian and Italian companies will cede equal shares of 10 percent each.
On Monday, the RF prime minister specified that the agreement on the French company’s joining the project will be signed in ST. Petersburg in June 2010. He also said that “there are no delays whatsoever with South Stream.” Putin recalled an intergovernmental agreement with Austria signed in Vienna last weekend that factually ended the creation of the South Stream’s legislative base. Putin confirmed that the construction of the gas pipeline will be completed in the second half of 2015. According to the prime minister, “the works in the Turkish special economic zone and examination of the Bulgarian sea bottom have already been completed” in the Black Sea by now. Putin stressed that the South Stream gas pipeline “will increase safety of Russian gas supplies to Europe.”
The main partners – Gazprom and ENI - have coordinated all the principal terms for the admission of EDF to the project. Besides, all the intergovernmental agreements needed for the launch of the construction of the South Stream gas pipeline have been signed.
South Stream is a proposed gas pipeline to transport Russian natural gas to the Black Sea to Bulgaria and further to Italy and Austria. The project would partly replace the planned extension of Blue Stream from Turkey through Bulgaria and Serbia to Hungary and Austria, and is seen as rival to the planned Nabucco pipeline. The completion is due by 2015.
The South Stream pipeline project was announced on 23 June 2007, when the Chief Executive Officer of Italian energy company Eni Paolo Scaroni and the Vice-Chairman of Russian Gazprom Alexander Medvedev signed in Rome a Memorandum of Understanding (MOU) for construction of South Stream. On 22 November 2007, Gazprom and Eni signed in Moscow an agreement about establishing a joint project company for the commissioning of the marketing and technical feasibility studies of the project. The joint venture South Stream AG, equally owned by Gazprom and Eni, was registered on 18 January 2008 in Switzerland.
The preliminary agreement between Russia and Bulgaria on Bulgaria’s participation in the project was signed on 18 January 2008. It was agreed to set up an equally owned company to build and operate the Bulgarian section of the pipeline. The agreement was ratified by Bulgarian Parliament on 25 July 2008. The first agreement between Russia and Serbia was signed even before announcement of the South Stream project. On 20 December 2006, Gazprom and Serbian state-owned gas company Srbijagas agreed to conduct a study on building a gas pipeline running from Bulgaria to Serbia. On 25 January 2008, Russia and Serbia signed an agreement to route a northern pipe of South Stream through Serbia and to create a joint company to build the Serbian section of the pipeline and large gas storage facility near Banatski Dvor in Serbia. On the same day, Russia and Hungary agreed to set up an equally owned joint company to build and operate the Hungarian section of the pipeline. On 29 April 2008, Russia and Greece signed an intergovernmental agreement on cooperation in construction and operation of the Greek section of South Stream.
On 15 May 2009, in Sochi, in presence of the Prime Minister of Russia Vladimir Putin and the Prime Minister of Italy Silvio Berlusconi, the gas companies of Russia, Italy, Bulgaria, Serbia and Greece signed an agreement on construction of the South Stream pipeline. On 6 August 2009, the Prime Minister of Russia Vladimir Putin and the Prime Minister of Turkey Recep Tayyip Erdogan in attendance of Prime Minister of Italy Silvio Berlusconi signed a protocol routing the pipeline through the Turkish territorial waters. On 14 November 2009, followed the talks between Slovenian Prime Minister Borut Pahor and Russian Prime Minister Vladimir Putin, the agreement on the terms of which a part of the pipeline will run through Slovenia to Northern Italy was signed by Russian Energy Minister Sergei Shmatko and Slovenian Economy Minister Matej Lahovnik in Moscow. As per earlier 2008 agreement between two countries, on 17 November 2009, Russian Gazprom and Serbian Srbijagas created South Stream Serbia AG in Bern, Switzerland. The joint engineering company will prepare feasibility study of the Serbian section of project. If agreement on investment is reached, the new joint venture will be also responsible for design, financing, construction and operation of the pipeline in Serbia.
On 2 March 2010, Russian Energy Minister Sergei Shmatko and Croatian Economy, Labour and Entrepreneurship Minister Djuro Popijac in the presence of Prime Minister of Russia Vladimir Putin and Prime Minister of Croatia Jadranka Kosor signed an agreement on construction of a South Stream section through Croatia.