Russia says some South Stream partners face EU pressure

Reuters

(Refiles to correct pipeline's name in paragraph 3 to "Nord Stream", not "North Stream")

MOSCOW, June 19 (Reuters) - Russia's energy minister said on Thursday some of its partners in the South Stream gas pipeline had come under pressure from the European Union to suspend their involvement, Interfax news agency reported.

Bulgaria halted work on building the pipeline this month at the behest of Brussels, pending a ruling on whether the project complies with EU law.

South Stream and another Gazprom pipeline, Nord Stream, are intended by Russia to bypass transit countries such as Ukraine, to which Moscow has cut off supplies in a pricing dispute.

"The European Commission has taken a tough stance on cross-border infrastructure projects with Russian participation," the agency cited Energy Minister Alexander Novak as telling the World Petroleum Congress in Moscow.

"Today, some of the South Stream partners are under pressure. They are being asked not to take part in the project until contentious issues on the pipeline's operation are resolved. In particular, our Bulgarian colleagues have been threatened with the cutting off of European funds," he was quoted as saying.

Bulgaria's Socialist government - which is expected to step down within weeks - strongly backed the pipeline but reluctantly suspended construction amid threats of punishment from Brussels, which is concerned the project does not comply with EU rules.

The European Commission, the EU's executive, suspended negotiations on bringing South Stream into line with EU law after Russia annexed Ukraine's Crimea region earlier this year.

Opposition leader Boiko Borisov, the front-runner to be the next Bulgaria's prime minister, told Reuters that if he were elected, South Stream's Bulgarian leg would still go ahead, but signalled he would pay more heed to Brussels than the outgoing government.

Moscow cut gas supplies to Kiev on Monday after Ukraine failed to meet a deadline to pay a $1.95 billion gas debt and declined an offer of an almost one-fifth discount to the gas price it is currently charged by Gazprom.

Interfax new agency quoted Novak as saying that there was no information of any gas flows disruptions to Europe via Ukraine.

The EU's top negotiator in the gas price row between Russia and Ukraine, Energy Commissioner Guenther Oettinger, is working to bring the two sides together again before mid-July, he told Reuters this week.

(Reporting by Lidia Kelly; writing by Katya Golubkova, editing by Elizabeth Piper and Timothy Heritage)

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