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President Putin to explore alternatives to South Stream with the E.U.

Russia is ready to discuss alternative options to South Stream with its European Union partners, says President Vladimir Putin. The Russian president said his country was not trying to punish its E.U. partners by deciding to stop the project, and is open to alternatives, but will not abandon cooperation with Turkey, reports Russian news agency TASS.

Commenting on agreements with Turkey to build a new gas pipeline, Putin said, “We are ready to build it in a volume enough to supply gas via Turkey to the European Union… We are not going to close anything, we are not going to isolate ourselves from anyone.”

In December of last year, Russia decided to halt plans to build the South Stream pipeline, citing unwillingness from European partners to continue the project. After announcing the cancelation of South Stream, Putin said that Russia would consider building a smaller pipeline to a gas hub in Turkey, near the Greek border. Putin also said that the hub in Turkey could be used to supply Southern Europe if the demand arose.

Putin said that Russia will consider the most profitable logistics in order to choose partners. Further cooperation with the E.U. is possible, “if they don’t hamper, a section of the South Stream might be implemented via Turkey, including using our joint ventures with Hungary, Serbia, we can go to Austria – everything is possible should our partners show interest in cooperation…

We don’t want to find ourselves [in] an awkward situation – today the European Commission refuses, tomorrow it agrees and the day after tomorrow it might refuse again.”

The South Stream project would have been beneficial for Serbia, Bulgaria and Hungary because it would supply gas straight from Russia without passing through Ukraine were political turmoil has caused uncertainty in gas deliveries. South Stream would have protected those countries from supply cuts, like the ones that took place in January 2009, but others in Europe feared it might make the E.U. too dependent on Russian supply.

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Important disclosures: The information provided herein is believed to be reliable; however, EnerCom, Inc. makes no representation or warranty as to its completeness or accuracy. EnerCom’s conclusions are based upon information gathered from sources deemed to be reliable. This note is not intended as an offer or solicitation for the purchase or sale of any security or financial instrument of any company mentioned in this note. This note was prepared for general circulation and does not provide investment recommendations specific to individual investors. All readers of the note must make their own investment decisions based upon their specific investment objectives and financial situation utilizing their own financial advisors as they deem necessary. Investors should consider a company’s entire financial and operational structure in making any investment decisions. Past performance of any company discussed in this note should not be taken as an indication or guarantee of future results. EnerCom is a multi-disciplined management consulting services firm that regularly intends to seek business, or currently may be undertaking business, with companies covered on Oil & Gas 360®, and thereby seeks to receive compensation from these companies for its services. In addition, EnerCom, or its principals or employees, may have an economic interest in any of these companies. As a result, readers of EnerCom’s Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this note. EnerCom, or its principals or employees, may have an economic interest in any of the companies covered in this report or on Oil & Gas 360®. As a result, readers of EnerCom’s reports or Oil & Gas 360® should be aware that the firm may have a conflict of interest that could affect the objectivity of this report.