Russian pipeline exit offers Middle East gas suppliers hope in Europe | The National

Russian pipeline exit offers Middle East gas suppliers hope in Europe | The National:



"The decision by the Russian premier, Vladimir Putin, to scrap plans to build the South Stream gas pipeline to Europe may help long-term aims to bring gas from Middle East suppliers to European markets.



Mr Putin made the surprise announcement on a state visit on Monday night to Turkey’s capital, Ankara, during which he said Russia would instead build a gas pipeline link to Turkey in a bid to strengthen ties with a country which has not joined sanctions to protest against Russia’s Ukraine policy. But the move is also clearly a response to relentless pressure from the European Union. OMV, the Austrian oil and gas company which is 25 per cent owned by Abu Dhabi’s Ipic, had been a strong supporter of the South Stream pipeline and signed a deal earlier this year to help fund construction of a spur to its Austrian terminus. OMV’s management has been under severe pressure from shareholders, which includes the Austrian government, which has the largest stake at 31.5 per cent.



The chief executive Gerhard Roiss, who had earlier pinned hopes on bringing gas to Austria from the giant Shah Deniz field in Azerbaijan via the planned Nabucco pipeline, saw those hopes dashed early last year when the field’s operators, led by BP, chose an alternative trans-Adriatic route. Mr Roiss and other senior OMV executives already have agreed an early departure and he will step down next summer."



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