Italian oil company Eni and Russia's Gazprom have agreed to study plans to build a new gas pipeline to supply Russian gas to Europe, the two companies said on Saturday. The proposed 900 kilometre (559 miles) "South Stream" pipeline will run under the Black Sea, splitting in two when it reaches Bulgaria.
One part will head to Austria and Slovenia, while another branch will bring supplies to southern Italy, Eni Chief Executive Paolo Scaroni told a news conference with Gazprom Chairman Dmitry Medvedev. The gas, however, will be targeted to the entire European market, not just the countries it will run through.
The pipeline will come online three years after receiving the necessary approvals, while the project's costs will be shared equally by the two companies. Italy is Gazprom's second biggest customer outside the former Soviet Union, relying on Russia for around 22 billion cubic metres of gas a year.
The companies signed an agreement last year that lets the Russian company sell gas directly on the Italian market. Eni will join Gazprom to buy oil assets in Russia and Africa.
Gazprom and Eni have worked together on the Blue Stream pipeline taking Russian gas to Turkey and have been looking to deepen their co-operation ever since Italy's antitrust officials forced them to scrap a previous co-operation deal in 2005.
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