Romania Starts Talks with Gazprom for Joining South Stream

Energy | June 16, 2010, Wednesday // 19:42|  views

Gazprom CEO Alexei Miller (left) pictured with Russian PM Vladimir Putin. Photo by EPA/BGNES

Russian energy giant Gazprom and Romania have started negotiations for the latter’s inclusion in the South Stream gas transit pipeline project, whose primary Balkan hub is supposed to be Bulgaria.

The matter of the talks entailed discussing Romania’s possible participation in South Stream by constructing a transit pipeline through its territory, says the statement of Gazprom as cited by RIA Novosti.

The negotiations were opened in Moscow with a meeting of Gazprom CEO Alexei Miller and Romanian Economy Minister Adrian Videanu as well as the heads of Romanian companies Romgaz SA and Transgaz SA.

“The parties have agreed that in the next few months they are going to conduct the technical and economic survey for the construction of a transit pipeline through Romanian territory within the South Stream project as well as a technical and economic survey of the construction of an underground gas storage facility in Romania,” Gazprom has announced adding that other energy projects such as electricity production should also be considered by the two parties in order to increase the economic feasibility of the gas transit pipeline.

The Russian and Romanian representatives have agreed that the bilateral energy relations have a good potential for development, and that the joint projects of Gazprom and Romgaz and Transgaz would guarantee the welfare of millions of people.

“We had a very honest and specific conversation today. We can now say that with these talks we have set on the agenda the question about Romania’s joining the South Stream project,” stated the head of Gazprom Alexei Miller.

He will be visiting Romania in the fall of 2010 when the Russian-Romanian South Stream talks will continue.

Romania’s desire to join the Russian-sponsored South Stream project have led many to comment that it might replace Bulgaria as the major Balkan hub of the gas transit pipeline if the Bulgarian government fails to iron out its differences with Russia with respect to the three large-scale Russian energy projects in the country – the Burgas-Alexandroupolis oil pipeline, the Belene nuclear power plant, and the South Stream gas transit pipeline.

In April 2010, Alexei Miller said that Romania could not replace Bulgaria in the South Stream project but that Gazprom might build a link from the major pipeline to Romania either from Bulgaria or through the Black Sea.

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.

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.

The first deliveries through the South Stream pipe are planned for 2015; the pipeline will have a total transit capacity of 63 billion cubic meters of natural gas per year.

For the realization of the project, Russia has already signed bilateral agreements with Bulgaria, Serbia, Hungary, Greece, Austria, and Slovenia.

South Stream seems to be the most unproblematic of the three Russian sponsored large energy projects in Bulgaria. Yet, one issue of contention has been a demand of the Russian side to use the existing internal Bulgarian gas transit infrastructure as part of the pipeline on Bulgarian territory instead of laying brand-new pipes.

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Tags: Romania, Gazprom, South stream, gas transit pipeline, pipeline, Alexei Miller, Adrian Videanu, Romgaz, Transgaz


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