EU Energy Majors Take 50% Share in South Stream Offshore Gas Pipeline; Agree Immediate Steps Towards Final Investment Decision

  • EDF, Eni, Gazprom, Wintershall join forces to implement pipeline project by end of 2015
  • Shareholders combine outstanding experience, financial and technological capabilities
  • Agreement underlines sound commercial basis of South Stream, and contribution to EU energy security

, Sochi (Russia) | Today, three major European energy corporations and Gazprom signed the shareholder agreement on the South Stream Transport AG, setting out the ownership structure in the Project Company in charge of the offshore section of the South Stream natural gas pipeline project.

The document was signed by Alexei Miller, Chairman of Gazprom's Management Committee, Paolo Scaroni, CEO of ENI, Henri Proglio, Chairman and CEO of EDF, and Harald Schwager, Member of the Board of Executive Directors of BASF SE, in the presence of Rainer Seele, CEO of Wintershall, and Marcel Kramer, CEO of South Stream.

The arrangement again confirms the pan-European nature of this major energy infrastructure project. According to the agreement, 20% of the shareholding in the company in charge of the offshore segment of South Stream is allocated with Italian Eni, while two tranches of 15% each are assigned to French EDF and German Wintershall. The remaining 50% is held by Gazprom. Running across the Black Sea with a total length of approximately 900 kilometres, the offshore section of South Stream will connect Russia vast reserves directly with the consumers in the European Union through four offshore pipelines.

Marcel Kramer, CEO of South Stream, said: "Today's shareholder agreement marks an important milestone. I welcome these strong partners that have decided to unite behind South Stream. The gas supply is available, the European markets need it, and we have the financial and technological means to implement an offshore project of this magnitude".

He added: "The signing demonstrates that the partner companies agree that South Stream is not only strategically important in the medium and long term, but that it is also a commercial opportunity not to be missed. South Stream will increase the gas import capacities and supply security for Europe's gas markets. It will boost the economic and infrastructure development in Central and South East Europe which makes it an obvious priority in many EU capitals. We are well on track."

South Stream is scheduled to start commercial operations by the end of 2015. The companies participating in South Stream Transport AG aim to take the final investment decision by the end of 2012, before constructions start in 2013. Shortly, the integrated feasibility study will be finalised, which will – amongst others – determine the final routing of both the offshore and onshore segments of the pipeline. This will allow South Stream to launch environmental impact assessments as well as permitting procedures in relevant countries.