LETTER FROM MOSCOW: MAY 2009

摘要

South Stream and Nabucco are not rival gas pipeline projects, it's just that they are competing to supply the same market and each would rather not see the other succeed. The announcement in May by Gazprom and Italy's Eni to double the capacity of South Stream to 63 Bcrn a year of natural gas would pretty much negate the need for Nabucco. South Stream, and its northern counterpart Nord Stream, would together deliver all of the expected increase in European gas demand over the next few decades. rnSouth Stream appears to be moving ahead of its troubled non-rival. Gazprom and Eni sealed the deal to double the capacity of the 900 kilometer underwater section to run from Russia to Bulgaria on May 15, in the presence of Russia's Prime Minister Vladimir Putin and his Italian counterpart Silvio Berlusconi. The same day, Gazprom signed accords with Bulgaria, Greece and Serbia jointly to build local onshore sections of the pipeline. rnA similar document has already being signed with Hungary, so Gazprom now has agreements with all key transit countries along the route. From Bulgaria, South Stream will split into two onshore paths, which Gazprom will build with local partners. One line will run southwest to Greece and into southern Italy. The other will go northwest via Bulgaria, Serbia, Hungary and Slovenia to northern Italy, with an offshoot to Austria. Russia expects to sign accords with Slovenia and Austria soon.