The Rasovo compressor station site (Rasovo settlement, Medkovets Municipality, Montana Province) in Bulgaria hosted today a ceremony of welding the first joint of the Bulgarian section of the South Stream gas pipeline.

Taking part in the event via video link from the building of the Bulgarian Council of Ministers in Sofia were Alexey Miller, Chairman of the Gazprom Management Committee, Plamen Oresharski, Prime Minister of the Republic of Bulgaria, Dragomir Stoynev, Bulgarian Minister of Economy and Energy and Alexander Novak, Russian Minister of Energy.

 “A landmark event has taken place today: construction started on the Bulgarian section of the South Stream gas pipeline – the most large-scale and important project in Europe. This project is a key element of energy security of the whole European continent. Gas will be supplied directly from Russia to Bulgaria, from Russia to the European Union, bypassing transit countries, thus providing for the most reliable and uninterrupted supplies. South Stream will eliminate transit risks for ever. South Stream will accelerate the economic development of Bulgaria, attracting EUR 3.5 billion of direct investments to the country and creating over 2,500 jobs. A new gas transmission infrastructure will increase the investment attractiveness of Bulgaria. Bulgarian consumers will receive gas at a lower rate as the gas pipeline runs directly from Russia via the Black Sea. The construction follows a strict schedule: before the year's end construction will start in Serbia, then in Hungary. Therefore, South Stream is steadily running ahead. Bulgarian consumers will receive first gas via South Stream in December 2015,” said Alexey Miller.

As part of the event a working meeting took place between Alexey Miller and Plamen Oresharski. The parties discussed further steps regarding the South Stream project. A 540-kilometer linear section of the South Stream gas pipeline as well as 366 kilometers of loop lines and three compressor stations will be constructed in Bulgaria. All the agreements reached during today's talks fully comply with the letter and spirit of the intergovernmental agreement between Russia and Bulgaria regarding the South Stream project implementation.

Background

For the purpose of diversifying natural gas export routes Gazprom is constructing a gas pipeline across the Black Sea to Southern and Central Europe – the South Stream project.

The offshore section of the South Stream gas pipeline will run under the Black Sea from the Russkaya compressor station on the Russian coast 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 and the design capacity – 63 billion cubic meters. The onshore section in Europe will be 1,455 kilometers long.

Banatski Dvor, one of the major Eastern European UGS facilities located in Serbia, was the first facility commissioned within the South Stream project. Banatski Dvor became operational in November 2011.

On December 7, 2012 the South Stream construction was launched. The first gas supplies via the gas pipeline are scheduled for late 2015.

On November 13, 2010 Gazprom and Bulgarian Energy Holding signed the Shareholders Agreement and the Articles of Association for the South Stream Bulgaria joint project company established on a par for the South Stream project implementation in Bulgaria. The joint project company was incorporated in December 2010.

On December 2, 2011 the South Stream gas pipeline was announced the national significance facility in Bulgaria according to the Council of Ministers Resolution.

On August 27, 2012 Gazprom and Bulgarian Energy Holding signed a protocol on the South Stream project implementation in the Republic of Bulgaria. The document defines the point of the gas pipeline entry into the Bulgarian gas transmission system, the gas pipeline parameters and further steps in the project implementation.

On November 15, 2012 Gazprom and Bulgarian Energy Holding adopted the Final Investment Decision on the South Stream gas pipeline construction in the Republic of Bulgaria.

On November 15, 2012 Gazprom and Bulgargaz signed a new long-term contract for Russian natural gas supply to Bulgaria. The document envisages annual gas supplies through 2022 in the amount of up to 2.9 billion cubic meters via the traditional gas transmission corridor, and once the South Stream gas pipeline is commissioned – via this new gas supply route.

Bulgargaz is a wholly-owned subsidiary of Bulgarian Energy Holding.