FID on South Stream Due by Year End

2012 will see the propulsion of the South Stream project towards completion, with a final investment decision (FID) and construction on the pipeline to begin by the end of the year.

Chief executive for South Stream Marcel Kramer said today that the consortium on the project expected an FID to be reached by the end of 2012.

"We will soon have a detailed review to shareholders to show where we stand on the proclamations towards an investment decision," Mr. Kramer told the Reuters news agency today. "We are on track but we are on a road that still gives us logically, with this size of a project, quite a lot of work."

The chief executive also denied that South Stream had faced similar problems to competing pipelines, with no financial uncertainty at any time among shareholders and no suggestion of the pipeline ever being made smaller.

"There has never been such a dramatic change in the markets for there to be a reason for us to contemplate a smaller system," he said.

Mr. Kramer also told the news agency that the consortium planned to begin construction on the pipeline by the end of this year, in line with an order from former Russian Prime Minister and current President Vladimir Putin that the project be sped up.

In January this year, President Putin told CEO of Gazprom Alexey Miller to "significantly speed up" the construction of the South Stream pipeline, which was originally due to begin construction in 2013.

Gazprom is the major shareholder in the South Stream project with a 50 per cent stake. Italy's Eni holds a 20 per cent stake, with Wintershall Holding and GDF Suez holding a 15 per cent stake each.