Tuesday, September 27, 2011

European energy firms take 50 percent stake in South Stream natural gas project


NEW YORK - Russian gas pipeline operator Gazprom, chemical company BASF and energy companies EDF and Eni have signed an agreement establishing the entry of BASF subsidiary Wintershall and EDF in the South Stream gas pipeline project.

Wintershall and EDF would each take a 15 percent interest in the project for conveying Russian natural gas to Europe under the Black Sea, while Gazprom and Eni would have a respective 50 percent and 20 percent stake in the project.

Executives from each company signed the agreement on Sept. 16 in the presence of Russian Prime Minister Vladimir Putin in Sochi, Russia.

"Today's agreements are part of the strategic partnership signed between Eni and Gazprom in 2006, which envisages the commitment of both parties to jointly develop projects in the entire gas chain," the company said.

The company expects construction of the South Stream gas pipeline to begin in 2013 and that the first gas supplies will be ready for delivery to Europe by 2015.

Analysts estimate that Europe's yearly demand for additional gas imports could reach 80 billion cubic meters by 2020 and surpass 140 billion cubic meters by 2030.

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