Pipeline Cements Russia’s Hold on Europe’s Gas Supply

Russia strengthened its grip on Europe’s energy supplies on Friday as it signed a major gas deal with Bulgaria that analysts said would further undermine the European Union’s attempts to diversify its energy sources.

Under the agreement, the $15 billion South Stream pipeline will be built under the Black Sea, allowing Russia to send natural gas directly to Europe through Bulgaria and bypassing Turkey, which has been a crucial transit route for Russia’s gas exports to European markets.
The pact, signed by President Vladimir V. Putin of Russia and his Bulgarian counterpart, Georgi Parvanov, was sealed after late-night negotiations with Gazprom, Russia’s state-owned energy monopoly.

Mr. Putin and Mr. Parvanov also signed an agreement for the construction of a nuclear power plant, the first Russian one to be built in a European Union country. Construction began in the 1980s but was halted in 1990. Planning for the project was revived in 2003.

The agreement on the South Stream pipeline dealt another blow to Nabucco, a major European Union gas pipeline project designed to diversify energy sources and reduce dependence on Russia. The union intends to buy gas from Iran and Azerbaijan and ship it through Turkey in pipelines that are run to Southern and Western Europe. But disputes over the routes, financing and how to deal with Iran’s nuclear program have delayed the project.

New York Times