The Hellenic Gas Transmission System Operator (DESFA) SA and OAO Gazprom proceeded today with the establishment of South Stream Greece SA, the company that is going to manage the section of the South Stream natural gas pipeline in Greece.

Both companies will participate on a parity basis in the Joint Venture Company. On behalf of DESFA SA Dr. G. Paparsenos, CEO, signed the establishment act in the presence of Mr. Panos-Dimitrios Mavrokefalos, Chairman of the Board of Directors.

On behalf of OAO Gazprom, Mr. Pavel Oderof, Deputy Head of International Business Department, signed the establishment act.

The establishment of the JVC South Stream Greece SAt ook place in the Hellenic Ministry for the Environment, Energy and Climate Change in the presence of Minister, Mrs Tina Birbili and the Russian Ambassador in Athens, Greece, Mr. Vladimir I. Chkhikvishvili.

The first meeting of the relevant project technical committee was held in the headquarters of DESFA SA, during which the feasibility study of work progress for the new pipeline has been examined.

In relation with the project

For the purpose of diversifying export routes of natural gas supply OAO Gazprom plans to construct a gas pipeline running under the Black Sea to the countries of the South and Central Europe: the South Stream project.

The offshore section of the gas pipeline is planned to be laid under the Black Sea from the main compressor station Russkaya on the Russian coast to the Bulgarian coast. Its total length will be around 900 kilometers, the maximum depth – over two kilometers. Annual capacity of the offshore section of South Stream will be up to 63 billion cubic meters.

To implement the onshore section of the Project outside Russia, intergovernmental agreements were signed with Bulgaria, Serbia, Hungary, Greece, Slovenia, Croatia and Austria.

The provisions of the above mentioned agreements stipulate establishing joint ventures responsible for the FS development, as well as for the further engineering, construction and operation of the South Stream gas pipeline in the signatory countries provided that the technical practicability and economic viability assessments are confirmed.

In May 2009, OAO Gazprom and DESFA S.A. signed a Basic Cooperation Agreement on implementation of the South Stream project on the territory of Greece. The document stipulated the principles of cooperation of the parties at the pre-investment stage of the project and determined conditions and procedures for establishing of the JVC as well as its operation mechanisms.