OMV: Russia-West Deadlock Will Not Affect South Stream Pipeline

The confrontation between the Russia and the West over Ukraine will not cancel the planned construction of the South Stream gas pipeline, according to OMV CEO Gerhard Roiss.

Roiss, as cited by RIA Novosti, commented that the gas pipeline project was a 50-year project and a delay of a few months was not an issue.

Commenting on the impact of the sanctions on Russia over the crisis in Ukraine, he noted that customers relied on their gas deliveries and he did not believe sanctions on gas supplies were likely.

He underscored that the pragmatic stance on the matter implied that a larger number of gas pipelines was beneficial for energy security.

Roiss drew attention to the fact that Russia was already carrying gas deliveries through the Opal gas pipeline, a conduit connecting the Nord Stream pipeline with gas transmission networks in Western and Central Europe with an annual capacity of 36 billion cubic meters of gas, despite the fact that Gazprom had not secured an EU approval to run the pipeline at full capacity.

On June 24, Russian Gazprom and Austrian OMV signed a shareholder agreement for the South Stream Austria joint venture, thereby setting out the principles of construction and further operation of the respective gas pipeline on the Austrian territory.

The European Commission has opposed the construction of the South Stream gas pipeline, saying that it contradicts EU law. The warning caused Bulgaria to stop work on the project until the matter was cleared.