South Stream to Finalize Route Mid-Year

Gazprom will determine the route for its South Stream gas pipeline project by the middle of 2011.

"This summer we will choose one of three possible routes for the South Stream pipeline," said Pavel Oderov, head of Gazprom's international business department.

South Stream is backed by Gazprom and ENI SpA as equal partners. Electricite de France SA and Wintershall AG plan to take 10 and 15% stakes (respectively) in the project, likely diluting Eni’s ownership interest.

This week Gazprom has won approval from Turkish authorities to move to proceed ahead with offshore prospecting in the Black Sea.

The prospecting is part of a process for obtaining permission from Turkey to have the South Stream cross its territorial waters.

Turkey has not yet provided Russia with its full approval required for the pipeline to proceed through its territory.

Energy Minister Taner Yildiz said Turkey will still abide by the terms of a 2009 agreement with Russia in respect to the pipeline, but that Turkey has not yet received the required information to provide its approval.

“We are still waiting for the environmental impact studies, as well as feasibility studies, on South Stream to see if the required criteria demanded by Turkey are met. If met, there is no question we would give our approval to the project,” he said.