Italy's Eni SpA (E) said Thursday it agreed with Russia's OAO Gazprom (GAZP.RS) to allow Electricite de France SA (EDF.FR) to join the South Stream natural gas project, which aims to link Russia to the European Union and boost the bloc's energy security.
"The agreement, in principle, welcomes EDF to participate in the South Stream project under conditions to be defined in the next months," Eni said in a statement.
The agreement was signed by Gazprom's Chief Executive Alexei Miller and Eni's Chief Executive Paolo Scaroni in the presence of Russian President Dmitry Medvedev and Italian Prime Minister Silvio Berlusconi.
"We welcome EDF's entry," Scaroni told reporters in the sidelines of the event. He said the sides will negotiate issues such as how the Russian gas will be split and what value to give to the stake they are selling.
Eni and Gazprom are discussing whether to give EDF an equal share in the minority stake of the South Stream project, Gazprom's Miller said.
These are part of the negotiations," Miller told Dow Jones Newswires on the sidelines of the Medvedev and Berlusconi. When asked if Eni and Gazprom would give EDF an equal share, he added: "It isn't necessarily so."
The South Stream project, a joint venture between Eni, Italy's biggest energy company by market value, and Gazprom, the world's biggest producer of natural gas, aims to transport gas from the Caspian area and from Russia under the Black Sea to Bulgaria, bypassing Ukraine.
Scaroni said he will further discuss the issue with Miller at a meeting scheduled for Dec. 11 in Venice. He added that he will meet EDF's new Chief Executive Henri Proglio this year and negotiating teams will start shortly after, indicating a deal is expected not long after that.