The management committee for Gazprom met Thursday in Moscow to discuss the pipeline and the company said in a statement: "It was pointed out that the project was advancing steadily. Intensive efforts are being made in all of the countries to be crossed by the gas pipeline."
A 560-mile offshore section of the pipeline would extend from Russia to the Bulgarian coast. From there, the line would run 900 miles over land through Bulgaria, Serbia, Hungary and Slovenia.
Pipeline construction started in Bulgaria in late October and in Serbia last week. Spatial planning is in the preparation stage in Slovenia and route determination through Hungary is expected by January, Gazprom said.
South Stream is designed for an annual capacity of 2.2 trillion cubic feet of natural gas. The company said it plans to commission parts of South Stream before the end of 2015.
Gazprom says the pipeline will add a layer of energy security to the European market.
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, observers say.
2014: The Year in Music [PHOTOS]