South Stream - History

History

The South Stream pipeline project was announced on 23 June 2007, when the Chief Executive Officer of Italian energy company Eni Paolo Scaroni and the Vice-Chairman of Russian Gazprom Alexander Medvedev signed in Rome a Memorandum of Understanding (MOU) for construction of South Stream. On 22 November 2007, Gazprom and Eni signed in Moscow an agreement about establishing a joint project company for the commissioning of the marketing and technical feasibility studies of the project.

The preliminary agreement between Russia and Bulgaria on Bulgaria's participation in the project was signed on 18 January 2008. It was agreed to set up an equally owned company to build and operate the Bulgarian section of the pipeline. The agreement was ratified by Bulgarian Parliament on 25 July 2008. The first agreement between Russia and Serbia was signed even before announcement of the South Stream project. On 20 December 2006, Gazprom and Serbian state-owned gas company Srbijagas agreed to conduct a study on building a gas pipeline running from Bulgaria to Serbia. On 25 January 2008, Russia and Serbia signed an agreement to route a northern pipe of South Stream through Serbia and to create a joint company to build the Serbian section of the pipeline and large gas storage facility near Banatski Dvor in Serbia. On the same day, Russia and Hungary agreed to set up an equally owned joint company to build and operate the Hungarian section of the pipeline. On 29 April 2008, Russia and Greece signed an intergovernmental agreement on cooperation in construction and operation of the Greek section of South Stream.

On 15 May 2009, in Sochi, in presence of the Prime Minister of Russia Vladimir Putin and the Prime Minister of Italy Silvio Berlusconi, the gas companies of Russia, Italy, Bulgaria, Serbia and Greece signed an agreement on construction of the South Stream pipeline. On 6 August 2009, the Prime Minister of Russia Vladimir Putin and the Prime Minister of Turkey Recep Tayyip Erdoğan in attendance of the Prime Minister of Italy Silvio Berlusconi signed a protocol routing the pipeline through the Turkish territorial waters. On 14 November 2009, followed the talks between Slovenian Prime Minister Borut Pahor and Russian Prime Minister Vladimir Putin, the agreement on the terms of which a part of the pipeline will run through Slovenia to Northern Italy was signed by Russian Energy Minister Sergei Shmatko and Slovenian Economy Minister Matej Lahovnik in Moscow. As per earlier 2008 agreement between two countries, on 17 November 2009, Russian Gazprom and Serbian Srbijagas created South Stream Serbia AG in Bern, Switzerland. The joint engineering company will prepare feasibility study of the Serbian section of project. If agreement on investment is reached, the new joint venture will be also responsible for design, financing, construction and operation of the pipeline in Serbia.

On 2 March 2010, Russian Energy Minister Sergei Shmatko and Croatian Economy, Labor and Entrepreneurship Minister Djuro Popijac in the presence of the Prime Minister of Russia Vladimir Putin and Prime Minister of Croatia Jadranka Kosor signed an agreement on construction of a South Stream section through Croatia. On 19 June 2010, Gazprom, Eni, and Électricité de France published a joint press release confirming that EDF will join the project. On 21 March 2011, Slovenia and Russia signed an agreement regarding the establishment of a joint venture South Stream Slovenia. This makes the route of the pipeline through Slovenia much more probable.

The joint venture South Stream AG, equally owned by Gazprom and Eni, was registered on 18 January 2008 in Switzerland. However, on 16 September 2011, a shareholders' agreement was signed between Gazprom, Eni, Électricité de France and Wintershall to establish the new project company South Stream Transport AG for the Black Sea section of the pipeline. The company was incorporated on 3 October 2011 in Zug, Switzerland.

On December 28, 2011 Turkey issued its final agreement for allowing the pipeline to pass through its territorial waters. The final investment decision for the Serbian section was signed on 29 October 2012, for the Hungarian section on 2 November 2012, for the Slovenian section on 13 November 2012, and for the Bulgarian section on 15 November 2012. On 15 November 2012, shareholders of South Stream Transport AG signed the final investment decision on the offshore section. The ground-breaking ceremony marking start of construction of the Russian onshore facilities was held on 7 December 2012 at the Russkaya compressor station near Anapa.