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September 29, 2022
BUSINESS

Gazprom starts building Europe-bound pipeline South Stream

After years of delays and negotiations, Russian gas company Gazprom on Friday formally started construction of its EUR 16 bln Europe-bound South Stream pipeline, key to its strategy of strengthening its supply to its most important export market, huffingtonpost.com reports. Russian President Vladimir Putin, the pipeline’s most powerful promoter, took part in Friday’s ceremony in which two 6-meter steel pipes were welded together to mark the start of the construction. “South Stream will create the conditions for a reliable gas supply for the main consumers in southern Europe,” Putin said. By beginning construction, state-controlled Gazprom steals a march on of its European Union-backed rival, the Nabucco pipeline, which has been plagued by a lack of funds and a reliable supply of natural gas. “South Stream solves two problems at once,” Gazprom CEO Alexei Miller said. “First, it does away with restrictions in the volumes of Russian gas exports and it minimizes transit risks by expanding our transportation network.” Gazprom in October also opened Nord Stream, a pipeline under the Baltic Sea directly linking Germany with Siberia’s vast natural gas reserves with a capacity of 55 billion cubic meters. The construction of South Stream and expansion of Nord Stream will leave Gazprom with a surplus capacity of 50 to 100 billion cubic meters, according to analyst estimates.The pipeline will go under the Black Sea to reach Bulgaria, Serbia, Hungary, Slovenia, Austria and Italy in one leg, and Croatia and Greece in a second.

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