Russia Cancels South Stream Project

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Russia says it will cancel its South Stream project, which was supposed to pump Russian gas to Europe under the Black Sea, as a result of the EU's resistance to the scheme. Russia plans to redirect those volumes to Turkey instead, in order to satisfy the country's growing demand and to create a gas hub on Turkey's border with Greece. The decision to cancel the South Stream pipeline -- which was to deliver up to 63 Bcm of Russian gas per year to Europe -- was announced by Russian President Vladimir Putin during his visit to Turkey on Monday. He called the position of the European Commission "not constructive." "If Europe doesn't want to realize the project, it won't be realized," Putin said. Construction of the 930-kilometer subsea part of the pipeline was supposed to start this month, and Russia was ready to build it, Putin said. The pipeline was to land in Bulgaria and then stretch through Serbia, Hungary and Slovenia to Austria and Italy. However, Bulgaria's new government, which was formed last month, has pledged not to proceed with construction until it complies with EU regulations, including the terms of the Third Energy Package requiring third-party access, something that Russia was trying to have excluded from the project.

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