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Serbia Says It Will Be Forced To Suspend South Stream Construction

A symbolic pipe prepared for the ceremony kicking off construction of the South Stream gas pipeline near the village of Sajkas, Serbia, in November 2013.
A symbolic pipe prepared for the ceremony kicking off construction of the South Stream gas pipeline near the village of Sajkas, Serbia, in November 2013.
Serbia says it may have to suspend construction of the South Stream gas pipeline through its territory, after Bulgaria said it was halting work on its segment of the pipeline.

Serbia's deputy prime minister and minister of energy, Zorana Mihajlovic, said Serbia would have to wait on the project while Bulgaria, the European Union, and Moscow held talks about the controversial Russian pipeline, which seeks to bring more gas to Europe via a route that does not pass through Ukraine.

But Serbian Prime Minister Aleksandar Vucic later said that no official decision had yet been made about suspension of work on the Serbian section of the pipeline.

Serbia faces a dilemma -- temporarily, at least -- after Bulgaria said it was temporarily halting work on the project.

Bulgarian Prime Minister Plamen Oresharski announced on June 8 that his country was suspending work on South Stream following criticism from the EU and the United States.

But Bulgarian Energy Minister Dragomir Stoynev said on June 9 that that didn't mean his country is giving up on South Stream, saying that the project "looks irreversible and important for both Europe and Bulgaria."

Russia's EU envoy, Vladimir Chizhov, on June 9 criticized Bulgaria's decision to suspend work on South Stream, calling it a "creeping shift to economic sanctions against Russia."

Bulgaria is key to the South Stream's route. The pipeline from Russia is supposed to surface from the Black Sea at Bulgaria before heading west through Serbia and other Southeast European countries to northern Italy.

South Stream would carry some 63 billion cubic meters (bcm) of Russian gas to Europe.

However, the European Union has been increasingly apprehensive about an overreliance on Russia for gas supplies, particularly since the Nord Stream pipeline is already bringing some 55 bcm of Russian gas to Germany.

The EU also has regulations for "unbundling," which stipulate that the producer of the gas cannot also be, for example, the owner of the pipelines that ship the gas.

Russia's state-owned gas giant Gazprom has worked with local companies along the route to form joint ventures to build and operate the pipeline, but many of these joint ventures are backed by Russian funding or loans.
With reporting by Reuters, ITAR-TASS, and Interfax
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