FX.co ★ Moscow finds alternative for South Stream

Alexey Miller, the head of Russian Gazprom, announced the decision to cease implementation of the South Stream. “That is all, the project is closed,” said Miller answering the journalists' questions about the prospects of the gas pipeline. In the framework of the visit to Turkey, Russian president Vladimir Putin declared that Moscow stopped the construction of the gas pipeline in the European Union in favor of Turkey. The president said that partnership aimed at strengthening of economic ties with a controversial ally of the West and empowerment of the Kremlin in South-Eastern Europe. The $20 billion “South Stream” project will be blocked, however, Russia has already spent $5 billion on its implementation. Now presidents of Russia and Turkey have agreed on the construction of the offshore gas pipeline with the capacity of 63 billion cubic meters of gas per year. Ankara will keep 14 billion cubic meters and the rest of the volume will be transported to Europe across the Turkish-Greek border. Moscow considers Turkey as a main economic partner, in spite of their disagreement over the Syrian issue. The head of the state gas concern announced that the Turkish pipeline will carry the same amount of fuel that should have been transported by South Stream. Officials noticed that Turkey will be suggested a competitive price for gas and additional discounts. Putin said that Bulgaria is going to lose €400 million ($498 million) a year if Brussels doesn't accept this agreement. This announcement is likely aimed to encourage protests of project proponents in Bulgaria.