Slovenia lifts remaining obstacles in the way of South Stream.
The Slovenian Prime Minister Borut Pahor has timed his visit to Russia for the football match between Russia and Slovenia. The aim of the visit was to tell his Russian counterpart Vladimir Putin that Slovenia has made the final decision to allow South Stream gas pipeline to be built on its territory. Putin welcomed Pahor at his residence in Novo-Ogaryovo from where they set out to watch the football match in the evening. Both were in a cheerful mood, which boded well for the signing of the agreements. "The main thing today, of course, is football. But we have looked at some of the other issues by the way," Putin said. We have signed an intergovernmental agreement on Slovenia's participation in the South Stream project."
The agreement is important because Slovenia is the last country to agree to the building of the pipeline. The way for the ambitious project is now clear.
"Today we signed the final agreement on the project with all the necessary European partners," Putin said, thanking all the other partners in Southern and Central Europe: Bulgaria, Serbia, Greece, Hungary and Turkey (the gas pipeline will be built in its economic waters). The end point of the gas pipeline will be Italy, but the Austrian Federal Chancellor Werner Faymann said last week that an agreement on Austria's participation in the project was being prepared.
This was the last of the permits for two new Russian pipelines to Europe that would bypass Ukraine and Belarus. A few days earlier Sweden, Finland and Denmark gave their consent to the building of another gas pipeline, Nord Stream.
"It is time to come clean," the Slovenian prime minister said after Russian Energy Minister Sergey Shmatko and Slovenian Economy Minister Matej Lahovnik signed an intergovernmental agreement. Under the agreement the Slovenian section of the pipeline will be designed, built and operated by a joint venture to be established on the basis of parity between Gazprom and the Slovenian gas transportation company Geoplin plinovodi.
The capacity of the pipeline on Slovenia's territory and its final route will be determined after feasibility studies for the project are completed. Slovenia's financial contribution will be determined in the next two years, according to Bloomberg.
The parties have also agreed to seek to secure for South Stream the status of a Trans-European energy network. South Stream will compete with the Nabucco pipeline, which will begin carrying Caspian and Middle-Eastern gas to Europe, bypassing Russia, from 2014. Nabucco has some influential advocates in Europe, so a counterweight is necessary.
"Why has Slovenia speeded up negotiations during the last month? We wanted to sign the agreement before our relations would go sour in connection with our team's victory," Pahor said in half-jest or half seriously.
Putin, who seldom misses an opportunity to parry such remarks, was reserved. "We shall see," the Russian prime minister said.
Pahor, however, would not let the topic rest. Recalling that Slovenia regards Russia as its friend, Pahor suddenly said: "And now I suggest, Mr Prime Minister, that you resign yourself to our victory."
"Just listen to him," Putin sounded provoked and recalled the proverb "there is many a slip twixt cup and lip". The outcome of the match showed that the proverb could apply to Russia as well as to Slovenia.
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About South Stream
South Stream is a system of gas pipelines that will run beneath the Black Sea to link Russia and the European Union countries. The underwater part of the pipeline will stretch from the Russian Beregovaya pump station to the Bulgarian coast. The total length of the Black Sea section is about 900 km and the maximum depth over 2 km. The total cost of South Stream is estimated at over $10 billion. The end points of the pipelines will be Italy and Austria. The pipeline will carry gas re-exported from Central Asia. The design capacity is 63 billion cubic metres of gas a year. South Stream should go on line in 2015. The project is implemented jointly by Gazprom and Italy's Eni.
Andrei Biryukov