Russia Celebrates Bulgaria’s Commitment to South Stream
The press center of the Russian government has released a seemingly triumphant statement announcing that Bulgaria and Russia will sign on Saturday an agreement practically giving the start of the realization of the South Stream gas transit pipeline.
According to the announcement, Saturday's visit of Russian Prime Minister Vladimir Putin in Sofia for talks with Bulgarian Prime Minister Boyko Borisov will culminate into the signing of the agreement for the establishment of a joint venture for building the Bulgarian section of the South Stream gas pipeline.
Thus, this is said to be the final step before the practical realization of the project.
"The planned signing of a shareholders' agreement for the company "South Stream Bulgaria AD" will allow by the end of the year to create a joint Russian-Bulgarian company for the designing, construction, and management of the Bulgarian section of the South Stream gas pipeline," says the Russian government statement.
Its celebratory tone appears to be in line with triumphant attitudes in Moscow over the Bulgarian government's decision to give a green light to the building of the South Stream pipe after more than a year of tense negotiations with Russia and Gazprom on large-scale energy projects and natural gas prices during which Russian critics repeatedly accused the Borisov Cabinet of politically-motivated balking.
In a Thursday's article, the Russian paper Vremya Novostei even said that Bulgaria has capitulated, or raised "the white flag" before Russia's demands for South Stream.
The South Stream gas transit pipeline is supposed to be ready by 2015. Its construction is expected to cost between EUR 19 B and EUR 24 B. It will be transporting 63 billion cubic meters of natural gas annually, or 35% of Russia's total annual natural gas exports to Europe.
The South Stream pipe will start near Novorosiysk on the Russian Black Sea coast, and will go to Bulgaria's Varna; the underwater section will be 900 km long.
In Bulgaria, the pipe is supposed to split in two - one pipeline going to Greece and Southern Italy, and another one going to Austria and Northern Italy through Serbia, Croatia and Slovenia.
The project was initiated by Gazprom and the Italian company Eni, and the French company EdF is also planned to join as a shareholder. It is seen as a competitor to the EU-sponsored project Nabucco seeking to bring non-Russian gas to Europe.
At a recent meeting in St. Petersburg, Berlusconi and Putin welcomed the idea of having German companies join in as shareholders. There is no indication as to how the joining of RWE or some other German company would re-apportion the stakes.
The ownership of the Russian-Bulgarian joint company to build and manage the Bulgarian South Stream section will be split 50-50%.
Source: Noinvite