"A landmark event has taken place today: Construction started on the Bulgarian section of the South Stream gas pipeline, the most large-scale and important project in Europe," Gazprom Chairman Alexei Miller said in a statement Thursday. "This project is a key element of energy security of the whole European continent."
South Stream is meant to add diversity to Russia's export routes through Europe. A contractual dispute between Gazprom and its counterparts in Ukraine, which hosts most of Russia's gas for Europe, adds a layer of risk to conventional routes, officials say.
Miller said the direct connection to Bulgaria, a member of the European Union, means geopolitical risks associated with transit countries are eliminated "forever."
Bulgarian consumers will receive gas from South Stream at a discounted rate once the entire project starts operating in 2015. Gazprom said construction should begin in other downstream countries by year's end.
The pipeline is designed for an annual capacity of 2.2 trillion cubic feet of natural gas.
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