South Stream Transport Signs 2.0 Bln Euro in Contracts with Italy's Saipem

Dutch-based South Stream Transport said on Friday it has signed contracts worth approximately 2.0 billion euro ($2.77 billion) with Italian company Saipem for works on the offshore section of the South Stream gas pipeline.

South Stream's offshore section will consist of four parallel gas pipelines each 931 kilometres long across the Black Sea. The Gazprom-spearheaded pipeline will supply natural gas from Russia to central and southeastern Europe. Its offshore part will run from Russia's Black Sea shore across the Turkish exclusive economic zone to the Bulgarian coast near Varna.

The agreements with Saipem cover the design and construction of Line 1 and construction of the shallow water parts, shore crossings, landfall and associated facilities for all four pipelines, South Stream Transport said in a statement.

The South Stream offshore pipeline will be laid by Saipem’s Castoro Sei, a S-lay vessel suitable for both shallow and deep waters, and by Saipem 7000, a J-Lay vessel suitable for ultra-deep water.

For the shore crossings, four micro-tunnels will be built on both the Russian and the Bulgarian side, each with a length of over 1.0 kilometre. These tunnels allow construction of the pipeline without significant construction works at the surface of the beach and shallow waters, thereby preserving the integrity of Russian and Bulgarian shores and mitigating environmental impact.

Activities at the landfalls will commence in June of 2014 with the preparations for micro-tunnel construction in Russia and then in Bulgaria.

Offshore construction will start in the autumn of 2014. In September 2014, the first pipes will be welded together in batches of four on-board the Castoro Sei to form so-called quad-joints that are 48 metres long. In November 2014, the Castoro Sei vessel will move to Russian waters to start offshore pipe-laying. At the end of the year, S7000 will take over pipe-laying and the Castoro Sei will move back to the Bulgarian harbour to continue quad-joint welding.

Construction of the first pipeline is to last until the third quarter of 2015, so the completed Russia-to-Bulgaria stretch will be brought to operation phase by the end of that year.

South Stream Transport B.V. is controlled by Gazprom, which holds a 50% stake, Italian group Eni with a 20% stake as well as French energy group EDF and German company Wintershall with 15% each.

Source: SeeNews