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EU Says Some Aspects of South Stream Unlawful

The European Commission on Thursday called for European Union member states to renegotiate the terms of their agreements with Gazprom on the South Stream natural gas pipeline, saying some aspects of the project were unlawful.

Russian state gas export monopoly Gazprom's plans to operate the planned pipeline, supply the gas passing through it and establish tariffs are in violation of EU law, said Marlene Holzner, a spokeswoman for the EU energy commissioner.

"We believe that in the European energy market, gas security and also competition is best served if there is not one company importing and producing gas, owning the pipeline and fixing the tariff," she said in comments carried by Radio Free Europe/Radio Liberty.

She said other companies, including from Germany and France, should also be allowed to supply the gas. According to EU law, an independent managing company should set the tariffs, which should be confirmed by a state regulator, she said.

Gazprom deputy chairman Alexander Medvedev told a Brussels meeting on Wednesday that all 63 billion cubic meters of gas that will flow through the link had found buyers, Reuters reported.

South Stream, which is set to pass from the Black Sea to southern and central Europe, is expected to begin commercial operation in 2016, with its full annual capacity of 63 billion cubic meters to be reached in 2018.

It is planned that the pipeline will go through Austria, Bulgaria, Hungary, Greece, Slovenia, Croatia and Serbia.

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