Bulgaria agrees to host South Stream

SOFIA, Bulgaria, July 7 (UPI) -- The Bulgarian government reassessed the profit potential for the South Stream project and agreed to host a section of the pipeline, the prime minister said.

Bulgarian Prime Minister Boyko Borisov said he took another look at the profits from South Stream and agreed to move forward with the project.

"Having come to terms on the outstanding issues, we are increasing the profitability of the South Stream project for Bulgaria twofold or threefold," he was quoted in the Interfax news agency as saying.

Russia aims to diversify its transit options to Europe with South Stream. The project is designed to carry as much as 2.2 trillion cubic feet of natural gas each year through the Balkans to southern Europe.

Viktor Zubkov, Russia's first deputy prime minister and board chairman of Russian energy company Gazprom, said the project had huge potential for both countries.

"We will make this project beneficial both for Bulgaria and Russia," he said.

Energy analysts said Gazprom may have sweetened the deal while at the same time suggesting Romania serve as an alternate host, Interfax added.

Marin Raykov, the Bulgarian deputy foreign minister, said in June that the government was leaning toward Nabucco, a rival to South Stream.

Both countries will make plans to establish a joint company to manage the project in Bulgaria later this week.