Today in Amsterdam (Netherlands) Oleg Aksyutin, Chief Executive Officer of South Stream Transport B.V. and Stefano Bianchi, Senior Vice President of Saipem entered into contracts for constructing the first of the four offshore lines of the South Stream gas pipeline.

According to the signed contracts worth around EUR 2 billion, Saipem will generate the project documentation, build the first offshore line of the South Stream gas pipeline as well as erect process facilities in the shore crossing areas as well as construct the landfalls.

Pipes will be welded together on board a special pipe-laying vessel and then laid in a proper position on the seabed at a depth of up to 2,200 meters. The South Stream gas pipeline will be laid by two pipe-laying vessels of Saipem: Castoro Sei, an S-lay vessel suitable for both shallow and deep waters and Saipem 7000, a J-lay vessel that constructed the Blue Stream gas pipeline in the Black Sea in the early 2000s.

For the shore crossings, four micro-tunnels will be built on both the Russian and the Bulgarian side. This technology will allow preserving the Russian and Bulgarian coastlines. Preparations for micro-tunneling operations will start in June 2014.

Offshore construction will start in autumn 2014. The construction of the first offshore line will last until the third quarter of 2015. At the end of the same year the first line will be commissioned.

Background

The offshore section of the South Stream gas pipeline will consist of four parallel lines, each longer than 930 kilometers, across the Black Sea from the Russian coast to the Varna Port in Bulgaria. Each line will be made up of over 75 thousand 12-meter pipes.

South Stream Transport B.V. is responsible for constructing the offshore section of the South Stream gas pipeline. The company's shareholding is split among Gazprom (50 per cent), Italian Eni (20 per cent), German Wintershall and French EDF (15 per cent each).

On January 29, 2014 South Stream Transport B.V. signed a contract and launched a tender among Russian and German pipe plants with regard to the supply of 75 thousand 12-meter pipes with a diameter of 813 millimeters (32 inches) for the first string of South Stream's offshore section.

South Stream is Gazprom's global infrastructure project aimed at constructing a gas pipeline with a capacity of 63 billion cubic meters across the Black Sea to Southern and Central Europe for the purpose of diversifying the natural gas export routes and eliminating transit risks. The first gas will be supplied via South Stream in late 2015. The gas pipeline will reach its full capacity in 2018.

In December 2012 the South Stream gas pipeline construction started near Anapa in the Krasnodar Territory. On October 31, 2013 a festive ceremony of welding the first joint at South Stream's Bulgarian section took place. On November 24, 2013 the South Stream construction started in Serbia.

Saipem (a subsidiary of Italian oil and gas concern Eni) is one of the world's largest oil and gas industry contractors specializing in engineering and technical support of offshore energy projects.