Kremlin decisions to end the pursuit of the South Stream natural gas pipeline project for Europe are final, the Russian energy minister said Thursday.
"In my view, the decision is final," Minister Alexander Novak said from Moscow.
With a delegation from natural gas company Gazprom in tow, Russian President Vladimir Putin declared an end to a project that would cross the Black Sea to the European market during a visit to Ankara. Instead, Gazprom said it was pursuing an alternate option for the Turkish market.
"Today we're working on the construction of the pipeline by another route," the minister said.
Early this week, German steelmaker Salzgitter AG, a pipeline contractor, said it would seek compensation through insurers following Putin's announcement. Saipem, the contracting subsidiary of Italian energy company Eni, said it's received no word on the status of South Stream.
"Operational activities therefore continue to progress," the company said.
South Stream was Gazprom's answer to energy security needs in Europe. Russia meets about a quarter of European natural gas needs, though most of that runs through a volatile Ukraine, where past contractual disputes between Gazprom and Kiev left Europeans in the cold.
Robert Lechner, a spokesman for South Stream partner OMV, told UPI there was no "immediate impact" for the Austrian energy company.
"The recent announcements regarding the project are a political issue," he said.
European leaders are wary of allowing companies like Gazprom that produce gas to control the corresponding transit systems and in August, the government of host country Bulgaria called for a suspension of all actions on South Stream because "the project does not meet the legal requirements of the European Commission."
