RUSSIA TO SIGN SOUTH STREAM AGREEMENT WITH AUSTRIA

ST.PETERSBURG, June 8 (Itar-Tass) - Alexander Medvedev, the deputy head of the Russian gas monopoly Gazprom, said that Russia would sign an inter-governmental agreement on the South Stream project with Austria. "An inter-governmental agreement will soon be signed with Austria under which Austria's company OMV will be appointed to coordinate the South Stream project," Medvedev went on to say. Alexander Medvedev said Russia was not in talks with Croatia or Bosnia on their participation in the aforesaid project. "No negotiations are under way, we've only had consultations on the possibility of building a spur from the main pipeline," Medvedev clarified. The South Stream project is a Russian-Italian scheme for the construction of a gas pipeline that will connect Novorossiisk in Russia to the port of Varna in Bulgaria via the Black Sea bottom. Then, the two spurs of the pipeline will run through the Balkan Peninsula to Italy and Austria. The pipeline is to begin operation by 2013. The Southern Stream is being created with an aim to diversify the deliveries of Russian natural gas to Europe. It is believed to be a rival project to the Nabucco gas pipeline, which is supposed to bypass Russia and is supported by the European Union and the United States. Bulgaria, Serbia, Greece and Hungary are participating in the Nabucco project together with Italian ENI.