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Russia: Gas pipeline project begins as EU mulls its competition compliance

 |  June 17, 2014

The European Commission is currently reviewing whether the South Stream gas pipeline project of Serbia and Russia is in compliance with competition law, but that hasn’t stopped its contraction from starting.

Russia announced Tuesday that the pipeline building has begun. It’s a controversial project as it stands as a symbol of tensions between Russia and the EU.

Russian gas giant Gazprom owns 51 percent of Serbia’s leading oil company NIS. With Serbia preparing to start construction on the Russian section of the pipeline in mere weeks, the nation is now caught between its political relationship with the EU and its economic relationship with Russia.

Earlier this month, Bulgaria suspended work on the pipeline after encouragement to do so from EU regulators. The Commission reportedly believes the South Stream is anticompetitive because it bars other gas companies from using it.

The Commission’s ruling on the pipeline’s legality is pending as tensions with Russia mount even higher in the wake of heightened conflict in Ukraine.

Still, construction for the Russian part of the South Stream will begin next month, and the section in Serbia will reportedly start being built in July. Several EU member states have also expressed support for the project, reports say, as proponents say the project will expand EU’s gas supply.

Full content: The Star

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