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Gazprom, RWE in talks over South Stream

12 July 2010 16:34 (UTC +04:00)

Baku - APA-Economics. Russia’s Gazprom has discussed its South Stream pipeline project with German utility RWE sources said on Monday as Russia is stepping up efforts to undermine the rival Nabucco project, Reuters Africa reported.

RWE is one of the key participants of the EU-backed Nabucco, which is meant to help Europe cut reliance on Russian gas.

Sources at both Gazprom and RWE said South Stream, a pipeline that would deliver over a tenth of Europe’s gas needs under the Black Sea to southern Europe, had been discussed by the two companies.

"It was just a preliminary discussion, nothing concrete. They are interested in entering the project," a Gazprom source said. An RWE source said the project had been discussed but declined further comment.

RWE refused to comment on the matter, saying it remained committed to Nabucco as "the best project for RWE at the moment".

German paper Handelsblatt reported, citing several unidentified people familiar with the talks, that Gazprom had approached RWE in order to win the company as a partner to the South Stream project.

RWE was still considering the offer, the paper said.

Russia has repeatedly attacked Nabucco -- which wants to deliver gas from Azerbaijan, central Asia and Iraq to southern Europe -- as a politically-motivated and not economically viable project saying it lacked firm gas contracts.

Moscow has also won a gas imports deal with Azerbaijan and signed another key Nabucco member, Austria’s OMV for South Stream although repeatedly denying South Stream was a rival to Nabucco amid growing European gas demand