uring the two-day visit of President Vladimir Putin (January 16-17, 2008) to Bulgaria, Russia inked a gas pipeline deal that would further entrench the Gazprom’s share in the European energy mix. Under the deal worth $15 billion, the 550-mile long South Stream pipeline would traverse under the Black Sea to reach Bulgaria1. This would allow Russia to send gas to Europe bypassing Turkey, which is a crucial transit route for gas exports to Europe. The negotiations on the Bulgarian deal succeeded in ensuring a 50 per cent stake for the Russian company in the construction and operation of the pipeline. This was against a minority stake that the Russians were offering during the beginning of the negotiations.

The EU has not welcomed the project as was reflected in its spokesperson Ferran Tarradellas Espuny statement- “We don’t consider the (South Stream) project a priority project in the same sense that we would Nabucco2.” The South Stream project will undercut the long-stalled Nabucoo pipeline backed by the U.S. and the E.U. The Nabucco pipeline, which was to source gas from Iran and Azerbaijan through Turkey into southern and western Europe aimed at reducing European dependence on Russian gas supplies. However, problems over routing, financing, and concerns over the Iranian nuclear program have prevented any concrete agreement over the Nabucco pipeline

• 1. Matthew Brunwasser and Judy Dempsey, “ Pipeline Cements Russia’s Hold on Europe’s Gas Supply,” The New York Times, January 19, 2008, at http://www.nytimes.com/2008/01/19/world/europe/19bulgaria.html?ref=business
• 2. Vladmir Isachenkov, “Bulgaria, Russia sign pipeline deal,” Houston chronicle, January 18, 2008, at http://www.chron.com/disp/story.mpl/ap/fn/5467174.html