Russia's new route through Turkey for South Stream gas pipeline project will overcome many legal bottlenecks of EU legislation and regulations, expert said.
'EU energy market rules forbid energy producers from simultaneously owning transmission networks,' Orestis Omran, a Brussels-based lawyer at the McKenna Long & Aldridge international law firm told The Anadolu Agency in an recent interview.
Russian state-owned gas company Gazprom was both the supplier of gas and owner of the South Stream natural gas pipeline to Bulgaria which ultimately would reach the European markets.
In addition, EU had other legal concerns in South Stream as well.
'Bulgarian tax regime was more favorable for Gazprom violating prohibition of state aid EU rules,' said Omran.
'Market access restrictions, such as intergovernmental agreements favoring companies of a certain nationality over others, were not allowed by EU competition law,' he added.
- New route through Turkey
In early December, Russia scrapped the South Stream project, and offered a new gas pipeline route via Black Sea to reach Turkey's northwestern Thrace region. At Turkish-Greek border a hub will also be constructed to transfer gas further in to European markets.
'Turkey is a not an EU member, and its involvement in the new gas route takes the relevant intergovernmental agreements, thus certain legal concerns out of the picture,' Omran said.
Omran reminded that with Gazprom being the supplier, the Greek gas operation network will be owned by another firm, most probably the Azeri energy company Socar.
If EU Commission questions the legality of the new project, partial ownership of the onshore pipeline on Turkey by a domestic company can be an option, Omran stated.
South Stream was also abandoned because it was very expensive, said Omran, adding 'The initial cost of around 16 billion Euros skyrocketed to more than 50 billion Euros.'
'The cost of a pipeline through Turkey is considerably less, while an important share of the gas flow will be sold to Turkey in good prices. This creates a win-win situation for everyone,' he concluded.
By Ovunc Kutlu and E. Gurkan Abay
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