Saipem told to stop work on Russian gas project

Saipem told to stop work on Russian gas project
The South Stream gas project was intended to channel gas from Russia to Europe. Andrej Isakovic/AFP
Saipem, the Italian oil services company, said on Thursday that it had been told by Russia’s Gazprom to suspend work on the South Stream gas pipeline project.

The company said it received a “notification of suspension of marine spread activities” on December 2nd, the day after Russian President Vladimir Putin told a press conference in Istanbul that the multi-billion euro project may come to a standstill.

Saipem was awarded a €2 billion contract to build the first line of the 2,500km-pipeline, which would have channelled gas from Russia to Europe, in March this year.

“At present it is not possible to determine the economic impact of the suspension on Saipem’s business, as both the duration of the suspension and the client’s ultimate decision on the project are unknown,” the company added in the statement on its website.

Italian oil giant Eni also holds a 20 percent stake in the project, while Gazprom owns 50 percent. The remaining stakeholders are Germany’s Wintershall and France’s EDF. 

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