It's getting cold in Europe...

[Guildenstern]

Some good things that may come out of this gas row as Gazprom and other big European gas companies will try to accelerate building of alternative pipelines, namely Nord and South Stream, which go around Ukraine...

I read that the South Stream pipeline would go from the Russian Black Sea coast across the seabed to Bulgaria, there to bifurcate into a southern branch toward Greece and Italy and a northern branch toward Serbia, Hungary, and Austria. In addition, Russia has proposed to extend this structure to many other countries along those routes.

Now, even if the South Stream project implies the diversion of significant gas volumes from Ukrainian pipelines, I think it is very difficult for Gazprom to satisfy all those potential customer countries along South Stream routes. There are prospects of important gas shortfalls for Russia, relative to its multiple, and growing, internal and external supply commitments from a stagnant production. Shortfalls are expected right when the South Stream becomes operational. After two decades of underinvestment in exploration and production (while over investing in other areas), Gazprom can only hope for large-scale production from new fields in Yamal (Siberia) in the latter part of the next decade.

[Sarmatian]

I read that the South Stream pipeline would go from the Russian Black Sea coast across the seabed to Bulgaria, there to bifurcate into a southern branch toward Greece and Italy and a northern branch toward Serbia, Hungary, and Austria. In addition, Russia has proposed to extend this structure to many other countries along those routes.

Now, even if the South Stream project implies the diversion of significant gas volumes from Ukrainian pipelines, I think it is very difficult for Gazprom to satisfy all those potential customer countries along South Stream routes. There are prospects of important gas shortfalls for Russia, relative to its multiple, and growing, internal and external supply commitments from a stagnant production. Shortfalls are expected right when the South Stream becomes operational. After two decades of underinvestment in exploration and production (while over investing in other areas), Gazprom can only hope for large-scale production from new fields in Yamal (Siberia) in the latter part of the next decade.

That's about right, although Italy will have two entry points. One from the south, from Greece and the other one will go through Slovenia to northern Italy.

It won't be just Russian gas, it will be also gas from several countries around Caspian Lake. I don't expect project to be finished before 2012-13 and then it'll take several years to build it. I think it will be finished in the latter part of the next decade, 2015-2020, somewhere in that period.

It isn't overly important how many countries will there be connected in the South Stream. Balkan countries are small in population and their economies are also small, they're not going to consume much gas. Even if you put Croatia, Bosnia, Macedonia, whatever-Balkan-country it won't change things so much. Germany consumes more gas than all Balkan countries put together. The only large consumer would be Italy, which also import gas from other sources...

[rasoforos]

Balkan countries are small in population and their economies are also small, they're not going to consume much gas.

True. Also I (and other Greeks) have this aversion of things that go ffffffsss and them booooom after an earthquake (since we experience one almost every other Tuesday)...

...I dont think it will ever enjoy widespread domestic use here...

...gas is only good for frying mussels!

[Guildenstern]

It won't be just Russian gas, it will be also gas from several countries around Caspian Lake. I don't expect project to be finished before 2012-13 and then it'll take several years to build it. I think it will be finished in the latter part of the next decade, 2015-2020, somewhere in that period.

Actually, I don't rely on the South Stream project very much. I very much doubt the whole thing. As far as I know, Gazprom has yet to show even a pre-feasibility study for South Stream, clarify its proposed routes, and prove that it can fill the South Stream pipeline to the planned capacity.

The South Stream project seems to me like a political and strategic bluff. I think it tries to hamper the carrying out of the EU-planned, US-backed Nabucco route for Caspian gas to Europe, largely duplicating that itinerary, so as to discourage investment in that project. I really hope the Nabucco structure will be built ahead of South Stream because it would represent a valid alternative to Russian gas for Europe.

[Sarmatian]

Actually, I don't rely on the South Stream project very much. I very much doubt the whole thing. As far as I know, Gazprom has yet to show even a pre-feasibility study for South Stream, clarify its proposed routes, and prove that it can fill the South Stream pipeline to the planned capacity.

The South Stream project seems to me like a political and strategic bluff. I think it tries to hamper the carrying out of the EU-planned, US-backed Nabucco route for Caspian gas to Europe, largely duplicating that itinerary, so as to discourage investment in that project. I really hope the Nabucco structure will be built ahead of South Stream because it would represent a valid alternative to Russian gas for Europe.

The project is in the infant stage, true, with this crisis not helping. Apart from that, there are many other issues. The deal involves many countries. Bulgaria signed in January last year and the definite deal with Serbia was signed only a couple of months ago.

South Stream isn't going to be built by Gazprom alone - it's a 50/50 joint investment between Gazprom and Eni. Feasibility study is being done by Eni and is supposed to be completed in 2009. There are still several options open concerning route, true.

Nabucco, on the other hand, is dead. It was never more than an idea, and those countries whose gas was supposed to transported by Nabucco are going to sell their gas through Russia. The only other option is Iran, but as you've said, daddy from Washington told Europeans not even to think in that direction...