Bulgaria Suspends Work on South Stream Pipeline

Bulgaria Suspends Work on South Stream Pipeline

Bulgaria is suspending work on the disputed Russian-backed South Stream gas pipeline following criticism from the EU and United States.

SOFIA, Bulgaria  -- Bulgaria is suspending work on the disputed Russian-backed South Stream gas pipeline following criticism from the EU and United States, Prime Minister Plamen Oresharski announced on Sunday.

"I have ordered all work to be stopped," Oresharski said after a meeting with U.S. senators. "We will decide on further developments following consultations with Brussels."

The European Union on Tuesday asked Bulgaria to suspend work on the multinational pipeline project, designed to bring Russian gas to Europe while bypassing crisis-hit Ukraine.

The European Commission said the project may break EU rules. In mid-April, it had already called for the project, led by Russian gas giant Gazprom (IW 1000/16), to be scrapped as a rebuke to Moscow for its actions in Ukraine.

But the Commission, the EU's executive body, has refrained from pushing for an outright cancellation and has instead engaged in a legal showdown with Gazprom and Bulgaria over regulatory details of the project.

Criticism also came from the U.S. after Sofia last month chose a consortium led by Stroytransgaz -- a Russian company subject to U.S. sanctions -- to build the Bulgarian section of the pipeline.

In a statement on Friday, U.S. Ambassador to Bulgaria Marcie Ries said Washington was "deeply concerned" by the decision.

"Now is not the time for business as usual with Russia," Ries noted. "We advise Bulgarian businesses to avoid working with entities sanctioned by the United States."

Bulgaria, which is entirely dependent on Russian gas supplies via Ukraine, was desperate to ensure it did not suffer another cut-off next time there is a dispute between Kiev and Moscow.

It was also keen to earn the large transit fees that would come from hosting the pipeline.

"We join the government of Bulgaria in seeking as a first priority energy independence from any country," said U.S. senator John McCain, who met with Bulgarian leaders on Sunday in Sofia along with several other senators.

But McCain insisted that the United States "would like to see as little Russian involvement as possible."

Work on the South Stream pipeline, which is to pass through Serbia and the EU nations of Greece, Italy, Hungary, Slovenia and Austria, was due to begin in the summer.

Copyright Agence France-Presse, 2014

TAGS: Energy
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