Russia runs out of patience, cuts off "South Stream"

On December 31, the Russian Foreign Ministry announced that South Stream had ended because when it was needed most, the EU closed its doors to Russia.

EU frantically tries to hold on to "South Stream"

On December 19, the Bulgarian Prime Minister announced that Bulgaria had been given permanent responsibility for preparing the construction work and issuing the necessary permits. The European Council has given its “full support and understanding”, and Bulgaria is no longer responsible and liable for the project.

Bulgaria will issue the necessary permits to start construction of the South Stream pipeline and continue the project, Bulgarian Prime Minister Boyko Borisov announced after a meeting with EU leaders at a summit in Brussels on December 19.

“Our country has a permanent responsibility to fulfill its obligations to prepare for construction work, and in particular for the extension of the pipeline across the seabed, and to issue the necessary permits. If Gazprom cancels the project despite Bulgaria’s permission, it is their fault, not Bulgaria’s,” Borisov said, adding that he is now “waiting for Gazprom’s reaction.”

Because of tensions with Russia over the political crisis in Ukraine and a desire to reduce its dependence on Moscow for energy, the European Union has opposed the $40 billion “South Stream” project, which was originally intended to lay a pipeline under the Black Sea and run into the EU through Bulgaria.

Some critics say they believe it violates European Union law, but several EU member states see the pipeline bypassing Ukraine as the best way to secure gas supplies and their own economic interests, and remain hopeful the project can resume.

German Chancellor Angela Merkel has recently expressed support for Bulgaria in its efforts to negotiate with Russia on the resumption of the South Stream gas pipeline, after Moscow canceled the project earlier this month and chose Türkiye as the new site.

Russia announced that the "South Stream" project has officially closed.

“We need to consider all the legal issues surrounding the South Stream project and use them to step up the exchange process with Russia,” Merkel said after holding talks with Bulgarian Prime Minister Boyko Borisov in Berlin on December 15.

Other countries that have benefited from the pipeline, including Serbia and Hungary, also want to revive the project. However, Russian Prime Minister Medvedev has repeatedly affirmed that “we do not rule out the possibility of cooperating with EU partners in a new pipeline project that does not pass through Ukraine”, but it is a different project than “South Stream”.

Putin's decision to scrap the project and partner with non-EU member Türkiye came after Western countries imposed economic sanctions on Russia over its actions in Ukraine. Putin said the EU had pressured Bulgaria, denied it autonomy and blocked the project, which would have supplied Europe with 67 billion cubic meters of gas annually.

The construction of a new gas pipeline to Türkiye across the Black Sea will replace the South Stream project. The initial cost of the offshore part of the South Stream was estimated at 10 billion euros, the onshore part through Europe - 6 billion. Later, the cost of the undersea section increased to 14 billion euros, and the onshore part in Europe - 9.5 billion.

After Mr. Putin decided to terminate the “South Stream” project after his visit to Türkiye on December 1, some experts said that this was just a “tough move” by Putin, forcing Europe to make concessions to Russia. However, reality has shown that Moscow is fully capable of terminating this project.

South Stream has officially ended

The first signs that the project is “dead” are that Türkiye plans to invest in the onshore part of the pipeline carrying gas from Russia. Ankara has no plans to finance the construction of the sea section of the pipeline from Russia, because it can only shoulder the costs of constructing the onshore section.

Türkiye's Energy and Natural Resources Minister Taner Yildiz said on December 11 that the country would calculate its costs for the pipeline section that passes through Thrace (the European part of Türkiye) and had no idea what the value of the pipeline section that will be laid under the sea would be.

Turkish pipeline project management company “Gazprom Russkaya” has been established

Then, on December 22, Türkiye proposed that Russia rename the “South Stream” pipeline to “Turkish Stream”. This means that Ankara is ready to start the project and Moscow will not need “South Stream” - the flow that can make Russia suffer every time there is a conflict with the EU.

It is expected that a quarter of the new pipeline’s capacity will be destined for the Turkish market to offset the gas currently transported through Ukraine and the Balkans. About 50 billion cubic meters will be piped into a new gas terminal to be built on the Turkish-Greek border.

European customers interested in this gas volume can buy it there. The enterprise implementing this new gas supply project will be called “Gazprom Russkaya”. In addition, a project to build a gas trading floor is also being planned by the Turkish side.

Commenting on the pipeline project to Türkiye last week, Gazprom Chairman Alexey Miller reaffirmed the “death” of the “South Stream” project and asserted that abandoning the project would not affect his company.

“Monetarily, Gazprom has not suffered any losses. We have invested almost $5 billion in gas transportation infrastructure on the territory of Russia to implement the “southern corridor” to transport gas to the Krasnodar region and supply it to the Russkaya compressor station.

“All these investments are absolutely necessary for the gas pipeline project across the Black Sea to Türkiye. Everything is in place,” he replied, adding, “There will be many events related to this project in the near future, when we will announce them specifically.”

The statement of the Gazprom chairman was reaffirmed by the Russian Foreign Ministry yesterday - December 31 when the Russian Foreign Ministry officially announced the closure of the "South Stream" topic after Moscow had to wait wearily due to the EU's fierce obstruction.

"As of today, as you probably know, the question of this project is closed, as President Putin clearly and unequivocally stated. “Russia refuses to build the South Stream gas pipeline and as of today, this issue is officially closed,” Russian Deputy Foreign Minister Vasily Nebenzya said.

Nebenzya recalled that “Russia has been patiently knocking on a closed door for too long, and when it finally realized that people did not want to open the door, Russia had to look for new partners because it makes no sense to pour billions into the sea of ​​​​investments without any hope of return” - the Russian diplomat said.

Russia also announced that it would compensate Serbia for "part of the damage" caused by the suspension of the project. The compensation was mentioned by the leaders of the two countries because "Russia does not want Serbia's interests to be affected". This confirms that Russia has firmly decided to cut ties with "South Stream".

According to baodatviet.vn