Russia clinches gas link deal

Russia has sealed a deal to speed up its controversial Southstream gas link. Italy, Bulgaria, Greece and Serbia have signed up to a plan which will double Southstream’s capacity. Moscow is bidding to out pace the Western backed rival Nabuco pipeline designed to ease Europe’s dependence on Russian gas.

Russia’s Gazprom paid a premium to buy back gas assets from Italian energy firms Eni and Enel while allowing Eni to sell Southstream gas in European transit states. Gazprom and Eni have already set up a 50-50 venture to build the pipeline starting near Sochi, across the Black Sea to reach Bulgaria, Greece, Serbia, Hungary, Italy and possibly Austria.

European calls for greater energy diversification intensified after Russia halted supplies to Ukraine twice in recent times. Pricing disputes and icy political relations between Moscow and Kiev have led to serious disruption of European gas supplies.

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tags: Gas