Ukraine Wishes South Stream ‘Peaceful Death’

KIEV, Ukraine -- South Stream, a gas pipeline backed by Moscow that would allow Gazprom to sell gas directly to Europe while bypassing Ukraine, has lost its raison d’être since Kiev started to normalise relations with Russia, according to one of the country's top advisers.

Andriy Fialko, foreign policy advisor to the president of Ukraine, said he wanted the project "to peacefully die".

Speaking at a round table organised by the European Policy Centre (EPC) on Friday (18 June), he said South Stream would represent a key test for Ukraine-Russia relations.

The new Ukrainian leadership sees itself as a strategic partner for Russia and it would make no sense for Gazprom not to use Ukraine's gas pipeline infrastructure, Fialko explained.

Referring to the South Stream project, he said it was "disappointing" to see "other strategic partners" strike deals which harmed Ukraine's interest without first consulting Kiev.

He added that the same applied to Nord Stream, an undersea pipeline bringing gas directly from Russia to Germany, the construction of which began recently (EurActiv 08/04/10), as well as "other projects".

Asked by EurActiv what Kyiv would do if Russia were to go ahead with the construction of South Stream, Fialko said: "I think one can safely say that it will seriously affect the readiness to go ahead with certain bilateral projects, if this is not addressed."

Asked to name such projects, he said he would not do so at the moment. Such projects were discussed, but for the time being, the question was hypothetical, he said.

"Our hope is that South Stream will peacefully die," he said.

Asked if Kiev had received indications from the Russian side that the pipeline could be scrapped, he said that this was not the case, but "financial realities" and developments such as the oil spill in the Gulf of Mexico could help to change Moscow's mind.

Fialko also indicated that the EU had a serious stake in the gamble, as Ukraine had an agreement with the Union to upgrade its gas transportation system. However, he said there was no commitment from the EU side or the Russian side as to how much gas would be pumped through that system.

"It would be a very extravagant exercise, particularly under the current economic situation, to invest two or three billion dollars in upgrading dramatically this potential, with the result of having 40% less gas pumped through. So we need reassurances from both sides, and this is not a caprice, but a necessity," concluded the policy adviser to the Ukrainian president.

Source: EurActiv