FID Reached for South Stream Offshore Section

The South Stream Transport Board of Directors which includes representatives from Gazprom, Eni, EDF and BASF yesterday in Milan, Italy discussed the key issues of the South Stream project and adopted the final investment decision for the offshore gas pipeline section. The financial details of the FID were not announced.

“The South Stream project makes a great contribution to ensuring the European energy security. It allows creating alternative and reliable routes of natural gas supply to our consumers. Let me congratulate everyone on the decision made today by the Board of Directors. It marks the start of the South Stream project realization,” said Alexey Miller of Gazprom.

The meeting also approved incorporation of South Stream Transport B.V. in Amsterdam (the Netherlands). It was highlighted that the offshore section of South Stream would be built in line with the terms and conditions approved by the Board of Directors in early 2012.

“The Project budget will be several billion euros. It will be partially covered by the Shareholders’ equity and partially financed by lenders. The exact Project budget for the South Stream Offshore Pipeline is yet to be determined upon completion of the technical design and finalisation of key tenders for pipe supply, pipe laying, and logistics. The approach to potential lenders is being prepared,” Sebastian Sass,  Head of Communications & Spokesperson South Stream Transport told Offshore Energy Today in an e-mail.

The offshore section of the South Stream gas pipeline will run under the Black Sea from the Russkaya compressor station to the Bulgarian coast. The total length of the Black Sea section will exceed 900 kilometers, its maximum depth will be more than two kilometers, design capacity – 63 billion cubic meters.

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Offshore Energy Today Staff,November 15, 2012