Vladimir Putin has
announced that he is cancelling the $50 billion South Stream pipeline project.
The cancellation comes after the European Commission refused to give Russia's state controlled energy company,Gazprom, the exemption it would need to operate the pipeline at full capacity, viewing it as a potential further tool for the Kremlin to exert economic control over southern and eastern Europe.
So now those countries will get nothing. Eastern European nations reacted with shock and anger, reports FT.
Bulgaria, Serbia and Hungary said they had received no advance warning that Moscow was scrapping South Stream, even though they all have substantial financial and political capital invested.
Putin claimed the demise of the project would cost Bulgaria about €400m a year in foregone income and suggested that Bulgaria had not behaved “as an independent country” over the issue – an apparent reference to the EU’s misgivings about South Stream, says FT.
“If Europe does not want to carry out [South Stream], then it will not be carried out,” he said. “It would be ridiculous for us to invest hundreds of millions of dollars constructing a project, bringing it to Bulgaria’s borders and having to drop it from there on.”
Putin said that Gazprom would consider developing a gas hub to southern Europe via Turkey, China is also a possible customer for the gas.
(map via FT)
The cancellation comes after the European Commission refused to give Russia's state controlled energy company,Gazprom, the exemption it would need to operate the pipeline at full capacity, viewing it as a potential further tool for the Kremlin to exert economic control over southern and eastern Europe.
So now those countries will get nothing. Eastern European nations reacted with shock and anger, reports FT.
Bulgaria, Serbia and Hungary said they had received no advance warning that Moscow was scrapping South Stream, even though they all have substantial financial and political capital invested.
Putin claimed the demise of the project would cost Bulgaria about €400m a year in foregone income and suggested that Bulgaria had not behaved “as an independent country” over the issue – an apparent reference to the EU’s misgivings about South Stream, says FT.
“If Europe does not want to carry out [South Stream], then it will not be carried out,” he said. “It would be ridiculous for us to invest hundreds of millions of dollars constructing a project, bringing it to Bulgaria’s borders and having to drop it from there on.”
Putin said that Gazprom would consider developing a gas hub to southern Europe via Turkey, China is also a possible customer for the gas.
(map via FT)
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