Russian Stroytransgaz to Build Overland Sections of South Stream Gas Pipeline

Russian company Stroytransgaz is preparing to sign contracts for the construction of the overland sections of the South Stream gas pipeline on the Balkans.

According to reports of Golos Rossii (the Voice of Russia), the company has already registered offices in Bulgaria, Serbia, and Slovenia.

The tenders for the construction works have already started.

The cost of building the gas pipeline is estimated at around EUR 16 B, but the major portion will go to the more expensive submerged section of the conduit.

Stroytransgaz, described as one of the main big subcontractors of Gazprom and among the initiators of the construction of the South Stream gas pipeline, is said to be getting ready to sign contracts for the sum of EUR 6.6 B.

In mid-July, socialist MP Tasko Ermenkov announced that the major share of construction works for the South Stream pipeline on Bulgarian territory would be awarded to local contractors.

Ermenkov, as cited by investor.bg, explained that the Bulgarian government had been given assurances by Gazprom about that.

Bulgaria will not provide any funding for the construction of the local section of the South Stream gas pipeline, but it will give up transit fees for a period of 15 years after its launch.

Bulgaria's current socialist-led coalition government has assured that the local section of the South Stream pipe, worth over USD 3 B, will not cost Bulgarian taxpayers anything.

South Stream is to be launched in 2016, carrying up to 63 bcm of gas a year from Russia to Europe.

The construction of the Russia-backed South Stream gas pipeline started on December 7, 2012 at the Russkaya compressor station site near Anapa.

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