Pipeliners

April 23, 2009- New York Times by James Kanter - BRUSSELS — Gazprom began a campaign in Brussels on Thursday to overcome “prejudice” against its South Stream gas pipeline — just as the Russian energy giant’s project hit a roadblock at the European Union’s border with Bulgaria. Prime Minister Vladimir V. Putin of Russia canceled his appearance on Friday at an energy summit in Sofia, because of slow progress over negotiations concerning a vital part of the route for the pipeline, according to news reports. South Stream will run under the Black Sea and link Russia directly to Bulgaria, bypassing Ukraine, through which more than 80 percent of Russian gas is now sent to customers in Europe. The negotiations are important for Russia because Bulgaria could force Gazprom to build a costly new network to transport the gas rather than allow it to use Bulgaria’s existing facilities. As part of the effort to push the project along, Gazprom representatives said they had held talks with the European Commission, the executive arm of the E.U., on giving the project a form of priority status, which would make it eligible for financial aid for feasibility studies and special loans. The perception among some Bulgarians, as well as in other parts of Europe, was that Gazprom was “going to take our network, which is not true,” said Sergei Kupriyanov, the spokesman for Gazprom. South Stream “is an important project at the European level,” Mr. Kuprianov said during an interview in Brussels. Mr. Kuprianov said building South Stream would be complementary to Nabucco, a separate pipeline project that would supply gas from other countries in the Caspian Sea region, rather than from Russia. Many E.U. leaders favor Nabucco but are skeptical about South Stream. They see Russia is an unreliable trading partner that has used gas supplies as a way to bully countries like Ukraine to stay within its sphere of influence. A dispute in January between Russia and Ukraine that severely interrupted gas supplies to Europe was the second incident of its kind in three years. Bulgarians were hardest hit, with many were left to shiver in a severe winter cold snap. Mr. Kuprianov said he met Thursday with Andris Kesteris, cabinet head for the E.U. energy chief, Andris Piebalgs, to discuss making South Stream a priority project. He said Gazprom officials would seek to make a presentation to the European Parliament to promote South Stream later in the year. Ferran Tarradellas, a spokesman for Mr. Piebalgs, said Gazprom would need to prove that South Stream represented “added value” for Europe to become a priority project. Mr. Tarradellas said Nabucco had already gained that status because it would diversify supplies away from existing suppliers like Russia. Even so, Mr. Tarradellas stressed that European authorities would not discriminate against Russian pipelines. He pointed out that the E.U. had already accepted a Gazprom-backed pipeline for Northern Europe, Nord Stream, as a priority project. Mr. Kuprianov said there could be broad benefits to gaining priority status. The recognition would show that contentions that South Stream is only in Russia’s interest were “completely untrue.” Gazprom’s “aim is to make sure there’s no prejudice toward South Stream,” he said.